Hungary's housing market faces excess supply and price slowdown as Otthon Start loans surge

OTP Jelzálogbank analysis shows that in the first half of 2026 only 3,300 new condominium units were sold in Budapest, a 25 % drop from the previous half‑year, while the stock of unsold apartments rose to about 900 units – a 40 % year‑on‑year increase. The overall supply of new apartments is projected to reach 9,400 units in 2027.

The government’s Otthon Start subsidised mortgage scheme has driven an eight‑fold jump in supported loan contracts, with total volumes exceeding HUF 1 trillion in the first five months of 2026 and the average contract size climbing to about HUF 27 million. Banks are adding bonuses and fee reductions to attract borrowers.

In Budapest, house prices fell for the third consecutive month in June, a 0.1 % decline – the first such streak since 2020 – while other regions show mixed trends, with price growth concentrated in eastern Hungary.

The rental market also cooled: the national rent index rose only 0.9 % in June (1.1 % in Budapest), the smallest increase since the Covid‑19 pandemic, and the number of listed rental units fell about 2.6 % nationwide. Median monthly rent in Budapest dropped from HUF 270 000 to HUF 260 000.

Experts warn that demand is moderating and the market is entering a consolidation phase, emphasizing the need to maintain a balance between supply, affordable rents and the sustainability of the subsidised mortgage programme.