What consequences will the CSOK bring to the market?February 29th, 2016
The government support family benefit (CSOK) program brought great changes and a lot of families are trying to find out what amount of money they can get in the new system. Therefore the investors' club of Portfolio discussed the topic in details a few weeks ago.
Lead analyst of Otthontérkép, Gergely Ditróy says the CSOK will completely change the Hungarian real estate market, but it is nearly impossible to tell exactly what kind of changes but it is hard to tell what to expect.
Experts say one of the consequences will be that prices of newly built homes will increase, and this will last as long as the artificially induced demand is present. The price of land (on which new homes can be built) will follow this trend.
Projects that were abandoned back in the days of the crisis and the following years will be rejuvenated as investors will see the chance to finish them with a decent return. Meanwhile the price of constructions will also rise as suppliers and developers don't want to miss out on the chance to carve their own slice of cake from the CSOK-money flowing to the market. Developers will likely switch to building 60-80 m2 houses instead of 40-60 m2 ones.
Who could be the winners?
First and foremost those who can opt for the 10+10 million amount in the CSOK program. Real estate developers, construction firms and professionals, land owners (in popular areas) will also experience the positive effects. Banks disbursing the CSOK will gain more business.
Those who build their own family homes in the countryside will gain access to more money to do so and families who are looking for homes in the suburbs or agglomeration can buy estates cheaper. Those who own apartments that can be rented by families transitioning to their new homes will have more clients.
And the losers can be those who want to sell estates. Used houses and apartments in popular areas and novel (5-10 years old) estates can experience a drop in prices.