Taxes and Expenses When Buying Real Estate in Hungary

Hungary is an attractive location for real estate investment due to its picturesque landscapes and affordable prices.

The buying process involves selecting a property, conducting legal checks, completing paperwork, and finalizing the deal through a notary.

The cost of real estate in Hungary varies depending on the region, type, and condition of the property.

In Hungary, new properties typically start at €2 400 per square meter, while the price for existing properties is around €1 100 per square meter. 

Most buyers look for homes in major cities like Budapest, where prices can be higher compared to rural areas.

Property Transfer Tax: When purchasing real estate in Hungary, the buyer must pay a property transfer tax of 4% of the purchase price if it exceeds a certain threshold.

Legal Fees: These include the costs for notarial and legal services that assist with legal aspects and document preparation. Legal fees typically range from 1% to 2% of the property's purchase price.

Property Valuation: If an independent property valuation is required, it usually costs between €200 and €500.

Registration Fees: Registering the property in the land registry incurs a fee of approximately €100-€200.

Annual Property Tax (Property Tax): This tax is calculated based on the property’s size and location. On average, the rate ranges from €1 to €3 per square meter in resort areas.

When selling real estate in Hungary, Capital Gains Tax is applied at a rate of 15% on the profit from the sale. 

However, there are tax exemptions if the property has been owned for more than five years—under such circumstances, no tax is levied.

• Annual Property Tax: This is based on the property's size and location
• Utility Costs: Ongoing expenses for services such as water, electricity, and heating
• Insurance: Property insurance costs range from €180 to €300 per year, depending on the coverage and property value

• Regular Repairs: Costs for routine maintenance and repairs to keep the property in good condition

For example, maintaining an 85 m² apartment typically costs around €135 per month. These expenses can vary depending on the condition and location of the property.

Income from renting out property is subject to Income Tax at a rate of 15%. Various deductions and allowances may be available to reduce the tax burden.

Specialists from Mercury Group handle the entire process of purchasing real estate in Hungary, from selecting the property to preparing a complete set of necessary documents "turnkey."