Hungary is fortunate to have no less than 7 neighbouring countries (clockwise, starting upper left): Austria, Slovakia, Ukraine, Romania, Serbia, Croatia and Slovenia which make cross-border trips and short holidays there all the more exciting and adventurous. But why to buy a holiday house or second home in Hungary and not in one of it’s neighbouring countries ? How does Hungary compare to and compete with it’s neighbours ? Such obvious questions require complex answers and individual situations may likely differ, but some general conclusions about definite downsides and pitfalls of buying a holiday house or second home in neighbouring countries have been drawn by experts. Let’s start with the good news:
Why to buy a holiday house or second home in Hungary ? Read all about it in the submenus Why Hungary and Legal and Tax. Still not convinced ? Contact us.
Now let’s take a closer look at the neigbours:
Why (not) to buy a holiday house or second home in Austria ?
Austria is a highly developed Western European country which has quite a lot to offer touristwise, including mountainous regions (Alps) and plenty of opportunities for water- and wintersports. Despite enticing images in travel agency brochures and on tourism promotion websites however, this country has some very serious downsides and costly pitfalls in store for unsuspecting real estate buyers …
First of all, if you are looking for a bargain when buying a holiday house or second home abroad: forget about Austria. Pricelevels there are in the same range as elsewhere in Western and Northern Europe, which means it will be quite difficult, at least in the popular regions, to find anything more or less decent under 300,000 euros.
Secondly, even if your budget is not a problem, the license (!) required to stay in your own Austrian holiday house or second home (so-called Freizeitwohnsitz) deters many potential buyers. Yes, you read it right: you need a government license to stay in your own house if you do not reside permanently in Austria. Yet only a small portion of the Austrian real estate market is eligible for such a licence. This means, if you naively buy a property in Austria without such a license, you may not be not allowed to stay in your own house and may even be legally obliged to rent it out to tourists and other strangers.
For instance, if the house you buy is located in a so-called Erholungsgebiet (recreation area), you are obliged to offer your house for rent and are only allowed to use it yourself during a restricted part of the year. You are also not allowed to live in your own house permanently, should you later decide to emigrate to Austria.
Acquiring a license to stay in your own Austrian holiday house or second home is mostly a time consuming and tedious bureaucratic procedure and a granted license will come along with all sorts of conditions, rules and regulations. Enough bureaucracy to spoil the holiday fun even before you start off.
A complicating factor is that Austria is a federal republic consisting of 9 states, the so-called Bundesländer, all of which all have their own legislation (so-called Landesraumordnunggesetze) to be examined and considered before buying a property there. Austrian laws were severely tightened in 2014 and the States of Vorarlberg, Tirol and Salzburg are considered to have the most restrictive legislation.
Some may say: I’ll buy it anyway and just see what happens. Illegal stay in my own house ? Big deal, who will find out anyway how often I’m there or not ? Be advised that house inspections are daily routine for Austrian government officials who are often ‘tipped off’ by jealous or discontent neighbourhood folks or overzealous commuting civil servants passing by your property, all too willing to text, mail, app or twitter first hand information and picture evidence about the presence or absence of ‘those foreigners’ to the police and other authorities, who also may also check your telephone, gas, electricity and water suppliers bills to evaluate the situation.
Simply buying an Austrian holiday house or second home without first spending tons of money consulting and hiring a specialised Austrian real estate lawyer could thus turn out as a kamikaze dive for your hard-earned money. As a ‘bonus’ to non-compliant house owners the Austrian government has even more in store: high fines and in some cases jail time, plus possible expropriation and auction of your Austrian property (so-called gerichtliche Immobilienversteigerung) ! Needless to mention in case of expropriation your property will fall into the hands of auction sharks against a mere fraction of the market value, and you will sadly remain with an enormous loss.
Fortunately, none of the above horrors apply to Hungary ! The laws are equal in the entire Hungarian Republic and you are free to buy a house and decide by yourself if, when, whatfor and how many times you or your family and friends will stay there, as long as you don’t exceed 90 consecutive days or 182 days per calender year, as applicable in most countries.
Why (not) to buy a holiday house or second home in Slovakia ?
Slovakia has some stunning scenery to offer, especially in the high mountains near the Polish border (Tatra National Park), but is otherwise a seriously underdeveloped Central European state with a very poor infrastructure. In large parts of the country you may have to drive for one hour or more (and back !) just to find a grocery shop or a basic restaurant. Education and entertainment facilities as well as everything that constitutes leisure and pleasure are almost absent on the Slovakian countryside. The main exception is the capital Bratislava in the outer southwest, not distant from Vienna (Austria), which is well worthwile to visit in summer and easily reachable from Hungary’s capital Budapest by air, boat or car in half a day or less. As a result of poor infrastructure and lack of employment and tourism, you would expect Slovakian prices in general, and real estate prices in particular, to hit rock bottom. On the contrary however, Slovakian real estate is disproportionately expensive. Don’t be surprised to pay double or even triple the amount for a Slovakian house in the border region compared to a similar type, style and size real estate on the Hungarian side of the border, while the landscape, the language and the general impression of the region is the same ! Prices of daily necessities are also considerably higher in Slovakia than in Hungary. Part of the explanation is that Slovakia has adopted the euro while Hungary still sticks to it’s forint in defiance of all the bureaucratic muscles from Brussels.
So by all means, do visit bubbling Bratislava in the southwest and the mountainous Tatras in the northeast if you can, but better avoid buying Slovakian real estate.
Why (not) to buy a holiday house or second home in Ukraine ?
The first obstacle is that Ukraine is not a Schengen country. Therefore you cannot travel freely to, through and from this country, but are subject to border controls and always need a visa, even EU/EEA citizens do. Ukraine is the largest European country, some 10% larger than France. It lies in the outer east of Europe with neighbours to its (north)east such as Russia and Belarus. However, whereas France is considered a politically and socially stable country, in 2014 Ukraine was confronted with civil unrest and a military conflict with Russia over the Crimea territory and also has a long history of corruption and nepotism. Nevertheless, real estate prices are ludicrously high in developed parts of this vast and largely desolate country that stretches from the borders of Eastern Europe to the Black Sea. The Ukrainian language is (like Russian) written in the cyrillic alphabet, which makes it extra difficult to decipher and comprehend this foreign language. Unless you are bound by Ukrainian business, employment, relatives or a personal relationship, there is no obvious reason why any foreigner would want to acquire a Ukrainian holiday house or second home.
Why (not) to buy a holiday house or second home in Romania ?
Romanian belongs to the roman language group and is thus related to for instance French, Italian, Spanish and Portuguese, which makes it a little easier to learn than slavic languages in Central and Eastern Europe. Romania is a large Eastern European country with a fascinating history, nature and culture. For instance, the country houses primeval forests and the largest European population of bears, wolves and lynx. Romania reveals extraordinary differences in wealth and lifestyles, varying from the rich and mundane northwest – where you pay top dollar for a property – to central Transylvania (the so-called last remnants of the Middle Ages in Europe), where countryside roads usually consist of bumpy mud tracks and transportation is still largely performed by horse and carriage or ox and cart. Here, in the proverbial middle of nowhere, you can buy real estate properties at rock bottom prices, but with whom will you renovate the delapidated buildings, where will you buy building materials and how will you cope with the lack of infrastructure ? No internet, no cell phone coverage, no gasstations, no restaurants, no medical facilities etc. for hours and hours on end. Considerable areas aren’t supplied with electricity, sewage and public lighting. You will mainly be on your own whereas poverty and criminality go hand in hand with the natural dangers of wildlife in this vast European wilderness. Therefore, the fascinating Transylvanian countryside is more of a choice for adventurers and heretics than for holidaymakers, retirees and pensionados.
Why (not) to buy a holiday house or second home in Serbia ?
Serbia stills suffers under a nasty history of violence (Balkan wars and the origin of the First World War) and genocide (1995 Srebrenica massacre). Secondly, Serbia is not a Schengen country. Therefore you cannot travel freely to, through and from this country, but are subject to border controls and always need a visa, even EU/EEA citizens do. Economically, Serbia is on its knees. Nevertheless, tourists and other foreigners bringing in much needed currencies are under scrutiny from customs and police and are often treated with disrespect by authorities and population. Traffic regulations are very strict. Offenders may end in jail. Serbian law also has restrictions and pitfalls for foreign buyers. Apart from it’s capital Belgrade, which nowadays embraces night life and attracts party animals from all over the globe, there is not much in Serbia to justify buying a holiday house or second home there.
Why (not) to buy a holiday house or second home in Croatia ?
Croatia is well known for its stunningly beautiful beaches along the Adriatic coast south of Italy and great opportunities for watersports with its long coastline and many lakes and islands. However, this covers only a small portion of the country. The inland is far less interesting. Needless to say that real estate prices in Coastal Croatia are staggering and have often risen to undesirable heights, at the risk of collaps after the political situation in Turkey stabilises. Also the coastal area – the country’s main attraction – is nowadays flooded with summer tourism as an alternative holiday destination for Turkey because of the political instability and state terror there. Good for Croatia, but not so good for your peace and quiet. Finally, Croatia is not (yet) a Schengen country, so border controls and custom restrictions apply.
Why (not) to buy a holiday house or second home in Slovenia ?
Slovenia is a very small country (about half the size of The Netherlands) south of Austria with only 2 million inhabitants. Nevertheless, Slovenia is blessed with four climate zones from alpine to mediterranean and arguably boasts the most beautiful nature of Central and Eastern Europe. More than half of its territory is covered with ancient woods, making Slovenia the most forested European country. Nevertheless, it is definitely the most ‘westernised’ country in this part of Europe as it used to be part of Austria for centuries. Here you will find all the comfort and luxury a spoiled traveler could wish for. Life here is every bit as modern and up-to-date as in Western and Northern European countries, yet without the hectic and the nervewrecking hustle and bustle of big cities. Slovenia is also home to the world famous Lippizaner state-owned stud farm in the south, near the Italian border, and a paradise for practitioners of extreme outdoor sports. Unfortunately Slovenia is becoming more touristic every year and daily life is rapidly becoming more expensive. Its currency is the euro and the general cost of living is still fairly reasonable, yet the most expensive of all of Hungary’s neighbours. Real estate prices count amount the highest, especially in the mountainous north (Karawanken, Julian Alps) where building ground is naturally scarce and existing villas and lodges cost a fortune.
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