I have just moved for the 21st time in 18 years in Budapest. This includes 6.5 years in one place. Sometimes it was a landlord that would always walk in when I was at home, or not. Sometimes the landlord threw me out with 24 hours notice because their son was returning from the army and needed the flat, or relatives from the countryside. Sometimes the rent went up 100% overnight, and more often still, it was break-ups with girlfriends. <!-- pagebreak -->While once there was an electrical fire in the wall (which raged for a week but we did not know until the electrician came and opened up a plate in the wall and flames started licking up the wall) causing brownouts and the landlord wanted us to pay for the damage caused by the 50-year old wiring. But now I can finally throw away all my banana boxes used for moving house all these years. It is a good thing, because my clothes, papers, nearly everything smells like my banana-flavored childhood diarrhea medicine. I have often thought I could do a tour of Budapest based on where my old flats are. Occasionally, I find myself on the metro still heading to an old address by mistake. But finally, it seems my life as a turtle with his life on his back has ended and I can settle down a bit.

Back in the day, everyone would get up dead early on a Monday morning and get the fresh Expressz newspaper for rental property listings. Most were gone by early afternoon. There is also the Hirdetes newspaper. These are still useful resources, but more often than not, the phone is answered by a real estate agent and the flat you wanted was just a teaser and not aktualis. There are several websites that are helpful, like ingatlan.hu, but the problem with real estate agencies is rampant there also. I think the best way to find a flat is still word of mouth. Tell all your friends in Budapest, put up a sign at CEU, ELTE, or Treehugger Dan's, or use Facebook. Join a Facebook Group like Budapest Baby, Xpats in Hungary, or Treehugger Dan's and post a notice to the group that you are looking for a flat. Everybody knows someone with a flat for rent. There are also useful marketplace listings on caboodle.hu and xpatloop.com.

Even with the so-called “global crisis,” new bank branches are opening on every corner in Budapest. Erste Bank is one of only 2, along with CIB, that would loan to someone earning only minimum wage. CIB, however, will only loan you 50% of what you need, while Erste will loan you significantly more. Petra Rigo (tel: 06-30-998-6164) is a broker that has connections to 10-12 banks, and will with great patience, help you compare the best offers. Unlike many brokers, she gets her fee from the bank and not from you. If you intend on taking out a loan, it is worth getting official residence. If you have your residence and ID cards, you will be considered like a local, and your interest rate will be much lower. I went with the Fundamentum package. At first glance it seems like the same scheme that helped cause the savings and loan bank crisis, but give me a second to explain. For the first 8 years you only pay interest into an account. Under normal circumstances, this is what gets people into trouble, because after 8 years suddenly people have sky-rocketing monthly payments they cannot meet. The Fundamentum splits the payments into two accounts, the second one being your principal payments. The payments combined are almost exactly the amount you would pay normally as one monthly payment of interest and principal together. The difference is that after 8 years of monthly principal payments of maximum 20000 huf, you get 30% tax-free interest from the government that is then directly applied to your loan. The other nice aspect is that while banks normally charge you a high penalty (1.5-2.5%) when you try to overpay and take down your principal faster, the maximum penalty here is 30000 huf. In addition, you can combine this with an additional life insurance investment that will earn you 10% tax-free over 8 years.

Hungarian real estate and bank practices are beyond insane for the home buyer. But most of us could not buy a flat without a loan. In the US, you go to a bank and see if you qualify for a loan, if yes, then you can go out and look for a property knowing that if the bank values the property well, there will be no problems with obtaining a loan. In Hungary, you must put down 10% (likely 100% of your life savings), while waiting for loan approval. If the bank does not approve the loan, or not within 1 month, you lose your down payment. That's right, the seller gets to keep your life savings! Everyone is guaranteed – the bank, real estate agent (holding fee of 100-150000 huf), the seller, everyone except you. And there is nothing you can do about it except bite your fingernails.

The question about whether or not foreigners need permission from one of the ministries to buy property is still unclear. Basically, the Land Registry Office (Foldi Hivatal) decides. If they do not ask for one, don’t worry about it.

There are a lot of costs involved, including insane things like house insurance starting 2 months even before you have the flat or the loan approved. The bank's property valuator gets about 30000 huf, processing the loan is 150000, illetek (taxes) will cost you another 5%, the notary public at the bank another 75000, house insurance, 1% of the value to the lawyer, the land registry...Sometimes the bank will subtract the valuation from your fees. If you your salary by direct transfer, this also saves you 50000 from bank fees.

I have several friends and acquaintances working as real estate agents
Richard Tomkin tel: 06-30-639-2688, richardtomkin@yahoo.co.uk
Richard Adkin at Modern Investments, tel: 06-30-914-6607, radkin@radkin.com
Ken Chase (found me my flat in 2 weeks) tel: 06-30-814-4061, spainchases@yahoo.ca

For renovations, Richard Tomkin and Zoli (see above) and their crew are fast, reliable, full of good ideas and advice, and honest. This combination is otherwise impossible to find in the capital.