Guest nights for Budapest are now returning toward pre-pandemic 2019 levels after COVID, followed by broad geopolitical, economic and financial issues, hit tourism hard, on top of concerns over demand and spending power, not to mention rising development, labor and operational costs.
Development in the various real estate markets in Hungary is impacted by concerns about demand and concluding the preleases that enable a project to go ahead, the availability and cost of financing, the increasingly protracted planning and permitting process, rising construction, maintenance and utility costs, and, finally, the opportunity of an exit strategy with a sale onto an investor at an appropriate time in the business cycle of an asset.
Hungary, and the region in general, is again seen as an increasingly attractive tourism and business destination. Guest nights have been on an upward trajectory; however, they are still below pre-pandemic levels, with the market negatively impacted by broader geopolitical, economic and financial concerns around demand, and rising development, labor and operational costs.