Budapest Property For Sale - Real Estate Investment in Hungary

Buying overseas need not be any more a complex and time-consuming process when you invest through an experienced, service-led organisation such as one2one property, who will support you throughout the process.

You do not even need to make regular overseas trips in order to purchase your property. In fact, some of our investors decide not to visit Hungary at all during the purchase process. This is perfectly acceptable and made possible by assigning power of attorney to a local lawyer, which is easily arranged.

The Process
Once you have chosen your units, you will need to follow the below process in order to complete your purchase:

1. Reservation
We will fill out a Reservation Agreement outlining the specific details of the chosen property, as well as your personal details. At the same time, we will take your properties off the market by you paying a € 3,000 Reservation fee. This fee is non-refundable, however, it is either deductible from the purchase price, or it will be transferred back to you upon signing the Sale and Purchase Agreement. The Reservation fee will hold the property for 21 days, until you sign the Sale & Purchase Agreement with the developer.

2. Assigning a lawyer and a Power of Attorney (PoA)
We always advise our clients to instruct a local lawyer to assist their purchase. We work with a number of highly experienced lawyers that we recommend to our clients.
Assigning a lawyer is not only important in order to make sure that your interests are protected, but also, so that the lawyer could act on your behalf while you are in your home country. Therefore, we will advise you to assign a Power of Attorney to your lawyer at the time of the reservation. We will always ensure that the lawyers whom we recommend will act promptly and professionally, thereby safeguarding your interests and guaranteeing a hassle-free purchase process.

The Power of Attorney will enable your lawyer to:
1. Sign the Preliminary Sale and Purchase Agreement in your name
2. Sign the Final Sale and Purchase Agreement in your name
3. Arrange a mortgage for you
4. Open a bank account for you
5. Represent you at the handover of your property

There are two ways to assign a Power of Attorney to your lawyer:

1. While in Hungary, during your first visit
When you first visit us in Hungary, we will take you to a lawyer for a free legal consultation, which is part of the services that we provide. In case you have made a decision by then, you will be able to sign the Power of Attorney right there.

2. From your home country, by a process called 'Apostille'
Should you decide to purchase without visiting Hungary at all, your lawyer will send you the Power of Attorney via e-mail, which you will need to print out and have notarised through a process called 'Apostille'. Again, you have several options to choose from in order to get this done.
First of all, you may visit a local Hungarian Consulate, where you can have your PoA apostilled.
Should you live far away from a Consulate, you may simply visit a local Public Notary to witness your signature, and then send the document to the Consulate in order to have it Apostilled. You need to do this as Hungarian law does not recognise a foreign Public Notary, and the Consul acts as a Public Notary in each country. Once your PoA is Apostilled, the Consul will send it back to you, and then you will need to send it back to your lawyer by registered mail.

3. Signing the (Preliminary) Sale and Purchase Agreement (SaP)
When purchasing off-plan property, in most cases you will first need to sign a Preliminary Sale and Purchase Agreement, and then, at a later stage - typically 6-3 months prior to handover - a Final Sale and Purchase Agreement. Should you purchase only a few months before your property is due for completion, you will sign a Final Sale and Purchase Agreement.

After reserving your property, your lawyer will e-mail to you your draft SaP filled out with your details. Before sending any document to you, your lawyer will have meticulously revised the contract making sure that it best protects your interests. Once you have received your contract, and you find all details in order, you will need to authorise your lawyer to use his PoA and sign the Sale and Purchase Agreement on your behalf (exchange of contracts in UK terms).

4. Transferring the first payment
Once your lawyer has signed the (Preliminary) Sale and Purchase Agreement, you will have 3 to 5 days to transfer the downpayment of your property, which will typically be between 10-30% of the purchase price of the property. We have negotiated that you will have nothing more to pay until completion of the property - with final payment being made by the mortgage company if you choose to finance your investment.

This payment is non-refundable. However, it will typically be protected, being held in escrow with a lawyer, or in a closed escrow account by the project financing bank.
We normally negotiate with the developer to ensure that the Sale and Purchase Agreement is fully assignable, meaning that you can sell the unfinished property on to another buyer prior to completion of the development, should you so need or wish, thereby ensuring the return of your deposit payment.

5. Signing the Final Sale and Purchase Agreement (SaP)
In case you have signed a Preliminary Agreement after reservation, you will need to sign a Final Sale and Purchase Agreement before completion. The same way as with the Preliminary Agreement, your lawyer will send you the Final Agreement for your approval, and will sign it on your behalf with his/her Power of Attorney.

6. Selecting your preferred finishings
We will contact you about 6 to 3 months prior to completion to help you choose the finishings for your apartment. You will be able to select from a number of colours and designs of tiles, sanitaries, parquet flooring and kitchen cupboards.

7. Agree on a provisional mortgage
Should you wish to fund your investment with a local mortgage, we are here to help you. Our qualified colleagues have negotiated favourable terms with banks and other financial institutions to enable us provide you with the best conditions available.
Your mortgage approval will take 3-5 weeks to go through, therefore we recommend that you start the process about two months prior to completion of your property.

8. Ordering your furniture package
We will assist you with furnishing your property to a high standard in order for you to achieve the maximum rental yield. Our colleagues will help you to choose the right package that best suits your apartment. You will need to order your package two months before handover to ensure prompt delivery of your selected goods.

9. Handover of your property
You can even take over your apartment without visiting Hungary - your lawyer will act on your behalf upon the technical handover of your property.

10. Completion of your purchase
After the technical handover of your property the final payment is due to the developer, which you may complete in cash, through releasing equity from another property or by your mortgege bank in case you decided to finance your purchase.

11. Rental and property management
Once final payment has been made, your property is assigned to you and is now ready for rental and property management. Our team will recommend to you a reputable company to handle the letting and management of your property.

Do you have more questions about the buying process?
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