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Buying a flat in Budapest: Nervous and Excited

Hi All,

My wife and I (Americans) are currently in the process of looking for a small flat to purchase in Budapest. We plan on living in it for part of the year and eventually turning it into a rental of some kind. 

We have found several options within our (small) budget in District 8.  We are aware that D8 has a reputation, and have accepted it's state of transition as a welcome tradeoff.

We are nervous about a few other things though.  Rather than pull our hair out we figured were worth putting some questions/concerns out the expat community in the hopes that you may be able to offer insight.

Inspection. The building is about 100 years old, we don't know exactly what to be looking for, and or if there major potential issues that cant be assessed visually. We would like to have an independent inspector check things out.  Wondering if anyone has an idea of how to go about this?  We don't speak hungarian.

Utilities. How hard is it to set up utilities in our name?

"Common Costs". How are common costs typically determined and regulated?  Should we be worried that they'll go up unexpectedly?

Building Rennovation.  The building we're looking at is shabby, but many other buildings on the block have already been rennovated.  The seller/agent tell us that there's money available in the common account of the building and that they plan on renonovating the facade/etc in the "next few years".  Is this the only kind of assurance we should expect?  Is there any contract/promises we should ask for before going ahead with the purchase?

They say the city owns several of the units within the building- should this be considered a red flag of any kind?

What else are we missing?

Any insight would be greatly appreciated!

Take your time and don't jump into buying right away.
We bought a flat in the 7th district 10 years ago.
Of course you need a lawyer to handle all the paperwork,be sure to go in yourself into the land management offices and make sure the flat is clear of any leans and the title is clear.
My husband speaks and reads perfect HUngarian but after being out of Hungary for decades even he was a nervous wreck when we bought our flat.
If the gov. owns a few flats in the building it just means they might be rentals. You plan on doing the same to your future flat so can't really make an issue of it.Even owners living in the flat can have issues and they won't be leaving anytime soon.
Our building has 44 flats and perhaps a 3rd are rentals, some used to be rentals and have since been sold to new owners who are living in them.
Things change fast in real estate, in 10 years we have seen neighbors pass away and new people come and go.
We did the same thing you plan on doing, just used our flat every once in awhile for a vacation place. Left it empty for almost 2 years, worried like heck about it while we were gone.
Renting and not being close by to collect rent and to make sure the place is not being used for illegal purposes is hard if you are not there or pay a reliable agency to oversee the place. They usually charge about equal to one months rent per year to landlord it for you. You will be subject to gov. taxes for a rental as well as be taxed on utilities. The only way to make a profit on a rental is to rent under the table to people you trust.
Our upstairs neighbor rented to some young Hungarian Rasta students. They wrecked the flat so badly that it took him forever to fix it enough to resale the flat.The cops were out 2 x a month because they held after hour parties in the flat and woke up the whole building. Happy they finally took them to court and had them thrown out.
I am not sure I would buy as an American not knowing the "tricks" that can and do go on with property and not have someone to watch your back.
We plan on selling our flat next year and either leaving HU for good or renting and having the freedom to not be tied down to a property.
Our flat is 115 years old and so far so good with major wiring etc.
Common costs do go up about every year, the building usually holds a meeting and they tell you how much to expect to pay. The larger the flat the more one pays of course.
Our utilities are all located in our own flat, we like it that way. If not we would still pay high costs when we were not there as part of sharing the payments with everyone else in the house.
Look allot and don't buy the first thing you see.
We were strapped for time when we bought, also then there was not much out there to buy and prices were on the high side. We paid cash so that also limited exactly what we bought, didn't want the hassle of getting a loan.
Not sure but I think the new regulations require a building inspection, not sure who pays the seller or buyer.
Distirct 8 has some nice looking buildings from the outside here and there but my husband won't hardly ever even walk there let alone buy and live there. Hard to explain but slowly even our district seems to be getting some shady characters. Nothing worst then living next door to noisy party people who have 3 or 4  drinkers in the house. District 8 is a rather low rent distirct and tends to have more unemployed people with too much time on their hands, if you get my drift.
We have a family in our house that holds some rather loud drinking/dancing and live music parties once in awhile. Hate waking up in the middle of the night with people banging walls to shut them up and waking me up in the process. People who hang laundry outside their flats or mops and brooms that seem to be more decorative then functional just sitting outside their front doors. Slummy looking...
Yes, the management  always promises to do work, they usually just do what is needed, basic stuff. I know I was freaking about a missing light bulb in the hall for months before it was changed. I was about to do it myself. Promises, promises, many managements landlords manage several buildings and make a killing on charges that the buildings don't see. Stuffing their pockets while promising to do repairs. Every building is different so try and talk to some people in the house to get an idea how the house is run.Go there different days and hours and look around good before buying.
You should really get yourself an advocate that understands real estate, might cost more in the beginning but you'll save yourself hassle and money later on. Everyone seems to have a scam or two up their sleeves. People are very slick in HU who do business, nobody's fool they make you feel a fool later when you see how you were used and abused.
Even neighbors could and some do work for management landlords in the house, can't really trust all the neighbors either. They might be getting a small cut monthly from the house to control matters.
We have a neighbor in our building that seems to be working for the manager who lives off property. Anything for a buck can't really fight any decision the house takes a vote on.

dnl.phillips :

The seller/agent tell us that there's money available in the common account of the building and that they plan on renonovating the facade/etc in the "next few years"

Believe nothing you hear, and only half of what you see.

Especially in real estate.

And especially in Hungary.

If you can not get it writing, for the purpose of the purchase, just consider it a ghost story that adds nothing to the value of the property.

just a thought.as Americans owning a property in Hungary does not allow you to stay in HU longer then ninty days unless you have some sort of visa to stay longer.
Immigration needs.to see more then just owning property to let ypu stay longer then the ninty days allowed.
I went through a huge hassle with them and my husband and son are HU citizens.
Leaving HU for more the ninty days with a HU resident permit is another issue.
Look into those details or you may find youself with a flat you can not visit at will.

Hard rent i the eighth district to people who will pay rent.If you rent to someone with children and acrimmie husband who is in jail,you will never collect.or get them out.
Laws protect who lives in the flat not who owns it.
Elderly kids, unemployeed with no where to go can not be put easily.People with moneu to pay rent dont usually look for rentals in that area.

Writting on a tiny tablet,sorry for any mis spellings.
The laws in HU favor those living in a property,hard to toss out non rent payers.
We are out of HU ATM and a bit of extraa cash would be nuce,just not worth it to rent while away,too open for troubles.
It only takes one bad neighbor in a house to wreck it for all.
We havefour that stand out.
Best bet would be to rent to foriegn students who leave every year.daddies money pays the rent.

My husband brought up another point.
The common costs are suppose to be put into an account for major repairs if the house needs them.
Hard to know exactly where they actually spend the money though.
In our house they hold a meeting once a year
and give a list of things they did for the house, many of these repairs didn't seem needed. Our house used to look rather clean but 10 years later we cold do with a new paint job.
No one has mentioned doing that for the house as of yet.
My husband went to one of these house meeting when we first bought our flat. We soon realized that the house did what they wanted and didn't listen to the owners.Several "regulars" in the house were on a sort of voting group and most owners never showed up for the meeting.Those who seemed to benefit from a vote were grouped together. One time they just gave one of their buddies an extra bit of sq.ft. A common room was no longer being used so they voted he could add it to his flat when he remodeled. No cost to him going towards the house but most likely he paid a few people to vote his way under the table. Common things like this happen all the time in HU and there is nothing to be done about it.
We did have to pay extra out of pocket to have a new electric meter put in, all the flats were required to do so if they had their own meters inside. It was a couple hundred bucks and the guys made a mess of the wall.
Any repairs that are not on the list of to do's for the house and need emergency service could cost owners more then just the monthly common costs.
Our new "idiot" neighbors upstairs used a roto rooter to clean their pipes after they got plugged by all the construction they did. Our flat had straight pipes so no damage was done, the unlucky people below us had a turn in the pipe line so a hole was made by the flat 2 floors above them. Not sure if it was fixed yet, water was running into the yard when I left HU.
Those same idiots drilled so hard into their side walls that they entered the next flat!
Have to be careful what sort of fools are living so close by as the flats are not as private as one would think they are.
It is not going to be any fun if you buy and run into a problem and need to rely on a idiot neighbor to get repairs done. Hard to know sometimes when the house is going to be shutting off the lights for hours or the water  main will be off if you can't read the posted house messages.
These old buildings are always getting worked on.
Also if you buy and are not around you should know that all the utility co. need access into the flat once a year if you have your own meters, they check to see if you messed with the settings. The chimney sweeper comes once a year even if there is no chimney in your flat. They must enter and if not can have the door opened by the fire dept.
need a reliable person to take care of these small details if your not around..

Thanks all, I appreciate your insights.  I know there are many concerns with the 8th district, but we've lived in Los Angeles for 10 years, which is more dangerous by every metric, and we've always been ok. 


Does anyone have an idea about how we'd find a reputable building inspector on short notice?

Sorry don't know about where to contact a trustworthy inspector.
LA is not Budapest, I know even had a friend from East LA and some from Korea Town, you might not get shot in the 8th but there are even worst things that can happen.(Grew up in S. Cal.,( San Fernando Valley in the 60's was not exactly a dream, low riders would use my Hippie friends and I for punching bags...)
Sounds like you already have your mind set so good luck.

Thanks Marilyn, have you personally experienced anything in the 8th that you think we should be aware of?  If so, and if you're willing to share, I'd love to hear more.  I will say that living in close proximity with lots of different people is the hallmark of any great city.  Perhaps there's cause for fear on both sides of this equation (locals fearign foreign investors driving prices up in traditionally working class neighborhoods, and those newcomers worried about the safety of a district in transistion).  Anyway, I appreciate your insight and welcome any insight from others on any of these topics?!

dnl.phillips :

Does anyone have an idea about how we'd find a reputable building inspector on short notice?

It if helps, usually architects in Hungary are the ones who have acquired the extra certificate for building inspections. So look up a few architects. Sorry, I know some, but none in Budapest and none speak English.

dnl.phillips :

locals fearign foreign investors driving prices up in traditionally working class neighborhoods

Gentrification is not really the issue here.

It is far, far, far more complicated. And to expound on that further would go off topic.

Closer to Museum Korut  and Jozsef Korut are nice areas of the 8th. Probably higher cost though.
The 8th is not horrible in the daytime but not exactly great for being out at night there.
My son's ex Hungarian wife was half Gypsy and even she was afraid to go at night to collect rent in the 8th from her mother's tenants.
I know a few people who have flats in the 8th but they are close to or on the larger Blvds.
The side street houses seems scary.
My HU friend worked for a real estate agency from Ireland. They gave her a flat in the 8th in a brand new house. Was really nice inside, we went there a few times at night for dinner. The last time we were walking home from her flat there was a group of young men just hanging on the sidewalk sort of scary, we crossed the st. to avoid them as they had a weird vibe like ready to hit one up for funds or worst.
The 8th district was not even great in the 1960's when my husband lived in the 5th.
He had a few friends that were from the 8th but no one ever went to visit their flats.
Just more unemployed people living there with more people in each flat.
Right now real estate in Budapest is reasonable all over so maybe you can find more options by not rushing into anything.
Also as Americans , I don't know your situation but we are not allowed to stay in the EU for more then 90 days straight with a 180 days break,Most of my ex pat friends in Hungary are from another EU country and they can stay as long as they wish in HU.
Of course if you have a visa then buying is not a bad idea.
Have a American friend in Budapest that has been there for over 15 years without any family connections. She has a few bucks so got a business visa although she really doesn't have a business to speak of. It's all about money in HU with immigration.

Marilyn Tassy :

maybe you can find more options by not rushing into anything.

If one feels pressured to rush, or if the seller in any way tries to push a deal, it is almost always a red flag to back off a bit, and maybe walk away.

The best advise I can give anyone, is to stay calm. Do not believe there is any "risk" to loosing a "good deal" if the seller is pushing a deal based on some time limit or giving the idea there is some time issue for the "good deal". Almost always there is something wrong. Devil will be in the details. Even a physical property inspection may not be relevant, as the details that will cause grief may come from a direction you may not even think of, unless you have a great deal of local relevant experience (and not even then). Again, walk away. I have financed a few property purchases in Hungary. And walked away from many more; especially when I felt pressured to do a "deal". I never regretted the ones I walked away from (and most of those are, at no surprise to me, still on the market).

Yes, if something sounds too good to be true it usually is.
Super scary to tie up your cash in a foreign country where you don't know all the rules and laws.
We almost bought a flat, got all caught up in how cute it was, how nice the bathroom was etc.
Brought in my husband's half sister who has always lived in Budapest, she asked some hard questions of the owner for us and told us to forget it. We found out they were even trying to pawn off extra square footage that really was not part of the flat. They had always been able to have access to an extra large storage space that only that flat could get to, it actually belonged to the house. Rip off from a sweet young couple who were expecting their first baby, never know who is out to get your money in HU.
I was slightly upset my SIL messed up the deal but on later thought was glad she did, keep your emotions out of the deal. Best to get another set of eyes to double check before signing the  dotted line...

Wishing you luck!

All the best for your new exciting adventure :top:
Budapest awaits!

Hello,

Please find below :
- Mr Csaba Veres (architect) tel 06304724782 email : batimage[at]t-online.hu  (englsih speaking)
he is independant building specialist and will be able to help you regarding technical issues

***

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Thank you everyone, we appreciate all the great insights.  Looking forward to spending some quality time in this wonderful city in the years to come.

I bought an apartment in Budavar, District I. The house/building aparently was built in the 60's. Ive heard its better to stay away from the old buildings built in the 1800's and earlier as the communists didnt maintain them properly hence are problematic. I guess this is not applicable to all those old buildings as some are properly maintained but many are falling apart literally.

Getting utilities on your name is easy, i can recommend Budapest Apartment Service, they speak fluent english and are very helpful, they also manage apartments for foreign owners, if you want to rent out you apartment they also take care of that, as well as assist with the buying process,  building work, renovations etc and also can help you with your tax affairs in Budapest. Just google them, or pm me and ill supply their contact details :)

I just bought myself.
Did I have a lawyer? Yes!
Did I believe the real estate agent? No!

Wouldn't even go near a real estate purchase without consideration of all the finances. For the common area, when people say they have "enough money" -- is that enough money for emergencies, for regular maintenance and upkeep? What about major renovations, like needing a new elevator or infrastructure?  Some folks here have already given some details about architects and others who would help.  I can say my experience in changing over the utilities and putting everything in my name was rather painless.  However, I speak Hungarian and have friends who are Hungarian who are helping me out immensely.

As crime is negligible in Hungary in general, especially when compared to the US, I wouldn't worry so much about that. But do pay attention to safety and aesthetics. I have friends who live in nice flats in the VIII district and I can tell you it's quite convenient and pleasant, but you can see areas that are distressed and would not be good to be left empty for large amounts of time.

All in all, I hope you do get the opportunity to enjoy a place in Budapest. And if you need help looking at places, I know a few tricks to help look for appropriate places. PM me and I'll be glad to share.
Good luck!

PS - Yes, I bought, it's all mine, deal done, completed.... BUT...I'm still nervous and excited!!

That is awesome congratulations! :) What district did you buy your property?

Thank you!
XIII District. Tuzer u

Ah ok good central location, I was there 2 weeks ago at my attorneys office. I'm in Uri u, District I

If you care about the value of your investment, now is not the best time to buy a flat in BP, prices have almost doubled since 2013, there is a bubble according to some.

Have I ever personally experienced anything really negative in the 8th district.
Well , no but then again my husband will not let me walk through there by myself and we never go there at night.

Take that back, had a HU friend who had a dinner party at her new nice flat in the 8th. We left around 9 pm and only had to walk over 2 blocks towards the large main blvd.
Her house was nice, new and safe with underground parking and security gates.
When we got to the corner of her street however there was a gang of 4 young guys smoking cig's just walked across the street from them and didn't mess around, just walked fast away.
One can feel the vibe of when someone is about to hit them up for something, we felt that vibe in the air.
Some parts of the 8th are rather nice though most of the building have allot of style from then outside.
My ex DIL's mom had a rental property in the 8th my DIL would go to collect the rent at night with my son, they drove over and only walked to and from their car after collecting the rent.
My DIL would always tease my son saying now your about to lose your nice leather jacket.
Not trying to be rude, my ex DIL was half Gypsy and could hold her own with her mouth, knew her way around the block.
Even she hated rent collecting at night in the 8th.

Have I ever personally experienced anything really negative in the 8th district.
Well , no but then again my husband will not let me walk through there by myself and we never go there at night.

Take that back, had a HU friend who had a dinner party at her new nice flat in the 8th. We left around 9 pm and only had to walk over 2 blocks towards the large main blvd.
Her house was nice, new and safe with underground parking and security gates.
When we got to the corner of her street however there was a gang of 4 young guys smoking cig's just walked across the street from them and didn't mess around, just walked fast away.
One can feel the vibe of when someone is about to hit them up for something, we felt that vibe in the air.
Some parts of the 8th are rather nice though most of the building have allot of style from the outside.
My ex DIL's mom had a rental property in the 8th my DIL would go to collect the rent at night with my son, they drove over and only walked to and from their car after collecting the rent.
My DIL would always tease my son saying now your about to lose your nice leather jacket.
Not trying to be rude, my ex DIL was half Gypsy and could hold her own with her mouth, knew her way around the block.
Even she hated rent collecting at night in the 8th.

They haven't doubled, but as you can see in the graphs, they have shown recent gains:
http://www.globalpropertyguide.com/Europe/Hungary
http://www.globalpropertyguide.com/Euro … ce-History

And Budapest is becoming more interesting to more non-EU folks:
https://next.ft.com/content/13f74b06-67 … b88f7d973f
http://www.nytimes.com/2015/05/28/reale … ngary.html

What has grown faster is rental prices.
http://www.bloomberg.com/news/articles/ … rism-grows

atomheart :

If you care about the value of your investment, now is not the best time to buy a flat in BP, prices have almost doubled since 2013, there is a bubble according to some.

I bought my property in late 2014

Jennifer_BudaVar1014 :

Ah ok good central location, I was there 2 weeks ago at my attorneys office. I'm in Uri u, District I

The Castle District -- so beautiful!!  Congratulations!
I'm excited for you!  :)  :up:  :thanks:

Vicces1 :

They haven't doubled

Depends on what kind of property you're looking at. Houses didn't change much, the most dramatic increase was in the small flats segment, if you check "Panellakas" on http://www.ingatlannet.hu/statisztika/Budapest , you'll see that the price per square meter rose from 180k HUF to 300HUF and in that data apartments are not broken down by size...

Thank you very much Vicces1 :) :top:

If you buy anything in Hungary you must own it for 7 years or you will be libel for high capital gains tax.

Yup, the good old attached strings. . .

Vicces1 :

http://www.nytimes.com/2015/05/28/realestate/real-estate-in-hungary.html

IMHO. Not worth $3,580,000.

For example: This house was also featured at the NY Times in 2013 at 690,000,000 HUF ($2,902,388):

http://www.nytimes.com/2013/04/11/great … ngary.html

It is still on the market, but now for the "reduced price" of 590,000,000 HUF ($2,072,000); that is, it is now almost $1 Million cheaper, but still can not sell (because it is still over priced):

https://www.engelvoelkers.com/hu/balato … elang=en#1

Dang, if I could afford a million dollar house, I would just buy back my sweet little valley house in S. Cal. Who need s the hassle of Hungary if they do not speak Hungarian and have no family here?
Calif. dreaming...

True, I would if i were you and i had a million $. It is important to live where one is happy

Think how far a million $ would go in Bp!! I'd stay.  :)

$1 Million really is not that much theses days. It can go much faster than one may think.

But that being said, saw an interesting 5 room house for sale in the US Virgin Islands today for $120K. Invest the rest for a modest income and just relax drinking Pina Coladas. So it really all just depends on what one wants in life.

Home is where the heart is.
I love living in Hungary part of it fulfils my sense of adventure, to experience living in this part of Europe. It has also enabled me to take early retirement because  accomodation can be far better and far cheaper than other places. So I am now semi retired living in a well run block in a good area. But most of all having space. My place is twice the size and half the cost compared to my last uk home.

However, I have noticed that some prices for apartments in Budapest have risen significantly since I got my place in 2013. Developers are also cutting bigger apartments in half so it is now very unusual to see places for sale that have a bit of space.

So I would advise anyone to hold back on buying and wait for prices to dip because almost everything i have seen is on the verge of being either unaffordable or pokey and on mean streets.

Hi
if you need a quote for renvation work I would be happy to visit your property.
You can reach me on ***
Look forward to hearing from you
Thanks
alan

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