Hungarian Real Estate Purchase for Foreigners: Complete Guide

Published on October 3, 2025 and written by Cyril Jarnias

Hungary, with its rich history, vibrant culture, and dynamic real estate market, is attracting more and more foreign investors. Whether you dream of a pied-à-terre in the heart of Budapest or a property in the Hungarian countryside, it is essential to understand the specifics of the property purchase process in this Central European country. This article will guide you through the key steps, regulations, and tax considerations to keep in mind for your real estate project in Hungary.

The Hungarian Dream Within Reach: Can Foreigners Really Buy?

The good news for foreign investors is that Hungary offers a relatively open framework for acquiring real estate. Unlike some countries that impose strict restrictions on non-resident buyers, Hungary allows foreigners to acquire properties under certain conditions.

For citizens of the European Union, the process is simplified. They enjoy the same rights as Hungarians regarding property purchase, without needing special permits. However, for non-EU nationals, a few additional steps are necessary.

Non-EU nationals must obtain authorization from the competent county administrative office before finalizing the purchase. This procedure, although sometimes perceived as an obstacle, aims to ensure transaction transparency and protect national interests. It is important to note that this authorization is generally granted without major difficulty, provided the buyer can demonstrate the legitimacy of their acquisition project.

A crucial point to remember is the distinction between buying buildings and acquiring land. While purchasing buildings (apartments, houses) is relatively straightforward for foreigners, acquiring agricultural land is subject to stricter restrictions, aimed at preserving the national agricultural heritage.

Navigating the Administrative Maze: Regulations and Obligations to Know

The property purchase process in Hungary, although relatively transparent, involves several steps and regulatory obligations that foreign buyers must know and respect.

One of the first steps is to obtain a Hungarian tax identification number. This number is essential for any real estate transaction and facilitates interactions with local tax authorities. It can be obtained from the Hungarian tax administration, usually with the help of a local lawyer or tax advisor.

Verifying the title deed is a crucial step in the process. In Hungary, every property is registered in a central land registry, accessible to the public. It is highly recommended to have a thorough title search conducted by a professional to ensure there are no liens, mortgages, or restrictions that could affect the transaction.

A particularity of the Hungarian system is the importance given to the preliminary sales contract. This document, often overlooked in other countries, has significant legal value in Hungary. It sets the sale conditions, price, and obligations of the parties. It is strongly advised to have this contract drafted by a specialized lawyer to ensure all important aspects are covered.

The role of the notary is also central in the purchase process. In Hungary, the signing of the final deed of sale must be done before a notary, who verifies the legality of the transaction and ensures all parties fully understand the terms of the agreement.

Finally, registering the property under the new owner’s name is a mandatory step. This procedure must be completed at the local land registry office within 30 days of signing the deed of sale.

Real Estate Taxation in Hungary: An Asset for Foreign Investors?

Taxation is a crucial aspect to consider when buying property abroad, and Hungary offers a relatively advantageous tax framework for international investors.

One of the main tax advantages of real estate investment in Hungary is the corporate tax rate, which is among the lowest in the European Union. With a fixed rate of 9%, Hungary positions itself as an attractive destination for investors seeking to optimize their taxation. This feature can be particularly interesting for those considering acquiring properties through a corporate structure.

Regarding acquisition-related taxes, buyers must pay a property transfer duty. This duty is generally 4% of the property value, which remains relatively moderate compared to other European countries. It is important to note that in some cases, particularly for the purchase of new properties or under specific conditions, exemptions or reductions of this duty may apply.

For non-resident owners, the taxation of rental income deserves particular attention. Rental income is subject to income tax in Hungary, with a fixed rate of 15%. However, thanks to tax treaties between Hungary and many countries, including France, foreign investors can generally avoid double taxation on this income.

An important point to consider is the capital gains tax on real estate. In Hungary, capital gains realized from the sale of a property are taxable. However, the Hungarian system provides for a progressive reduction of this tax based on the property’s holding period. After 5 years of ownership, the tax rate begins to decrease, reaching total exemption after 15 years. This provision can be particularly advantageous for investors considering a long-term strategy.

It is also important to mention the property tax, which is determined and collected at the local level. Rates can vary by municipality but generally remain moderate compared to other European countries.

The Perfect File: Essential Documents to Finalize Your Purchase in Hungary

Preparing a complete and well-structured file is crucial to successfully carry out your property purchase project in Hungary. Here is a detailed list of essential documents you will need to gather:

1. Valid passport or identity card This is the basic document to prove your identity. For non-EU nationals, ensure your passport is valid for at least six months beyond the planned purchase date.

2. Hungarian tax identification number As mentioned previously, this number is essential for any real estate transaction in Hungary. You will need to provide the certificate of assignment for this number.

3. Proof of income Documents proving your financial capacity will be necessary, especially if you are considering bank financing. This may include pay stubs, bank statements, or recent tax returns.

4. Proof of funds If you are buying in cash, you will need to provide documents attesting to the origin of the funds, such as bank statements or proof of sale of other assets.

5. Purchase authorization (for non-EU nationals) If you are not an EU citizen, you will need to obtain and present the purchase authorization issued by the county administrative office.

6. Preliminary sales contract This document, signed by you and the seller, details the sale conditions and is crucial in the Hungarian process.

7. Property appraisal report Although not mandatory, it is highly recommended to have an independent appraisal of the property conducted by a licensed expert.

8. Seller’s certificate of ownership This document, obtained from the land registry, proves that the seller is the legal owner of the property.

9. Plans and building permits For recent or under-construction properties, these documents are essential to verify the property’s compliance with local regulations.

10. Power of attorney (if necessary) If you cannot be present for all steps of the transaction, a notarized power of attorney will be necessary to authorize a representative to act on your behalf.

11. Cadastral extract This document provides detailed information about the property, including its area and boundaries.

12. Energy certificate Mandatory for most real estate transactions in Hungary, this certificate assesses the property’s energy performance.

• For buyers considering bank financing, additional documents will likely be required by the bank, such as guarantees or insurance.
• If you are buying through a company, additional documents related to the company’s structure and financial situation will be necessary.
• For condominium properties, it is important to obtain the condominium bylaws and minutes of the latest general meetings.

Conclusion: A Promising Investment, But One That Requires Meticulous Preparation

Buying property in Hungary represents an interesting opportunity for foreign investors. With a dynamic market, attractive prices compared to other European capitals, and a relatively advantageous tax framework, Hungary offers fertile ground for international real estate projects.

However, as with any investment abroad, the key to success lies in meticulous preparation and a thorough understanding of local specifics. The complexity of the purchase process, the nuances of Hungarian taxation, and the particularities of the local real estate market require a cautious and well-informed approach.

It is highly recommended to surround yourself with experienced local professionals – lawyer, notary, real estate agent, and tax advisor – to navigate this process effectively. Their expertise can prove invaluable in avoiding potential pitfalls and maximizing the benefits of your investment.

Finally, it is important to keep in mind that the Hungarian real estate market, like any market, is subject to fluctuations. A thorough analysis of market trends, the country’s economic prospects, and your own investment objectives is essential before embarking on an acquisition.

With a well-prepared approach and sound advice, real estate investment in Hungary can not only offer interesting financial opportunities but also open the doors to a country rich in history and culture, at the heart of Europe.