Houses abandoned by their foreign owners in Southwestern Hungary are being invaded by rats, blighting the surrounding villages, writes penzcentrum.hu. According to the portal, around the middle of the last decade numerous houses and lots in Somogy County’s picturesque Koppányvölgy valley were purchased by Austrian, German, Dutch and Swiss nationals. While some of these foreigners stayed and even assimilated, many have since cut and run, allowing vermin to take their place.
Residents are said to be waiting for the local authorities to do something about the problem, but the latter say that trying to find foreign owners who bought and then moved away would be a waste of time.
No word yet if there is any similar trend in other foreigner-invested parts of the Hungarian property market.
Well there’s obviously something wrong here.
The Koppánvölgy in Somogy county we know is in WEST-Hungary.
Still I wonder what (and who ?) made German speaking people buy houses and invest money there, really strange.
@wolfi: Indeed you are right – SW not SE – and the
text was changed accordingly. I also think you are
right in saying the whole piece seems a little
strange, but there you go…
Erik, this is not the only case where I’ve heard “Westerners” buying a house far from any attractions (like Balaton, Heviz, or any spa at all) and also in a village without a supermarket or restaurant – just because it was so cheap maybe ?
I really wonder sometimes about their motives (but not about the seller’s ones).
A friend of mine bought a house in Zalabér, which is a nice village with a very good country restaurant (St Antal) but about 30 km from Heviz – so I wondered …
Anyway he died from cancer last year so I don’t know what’s going to become of the whole story, his children aren’t interested in it.
Also I think he didn’t really “buy” it but had some kind of strawman, because the house is not in the village proper, so as far as I know a foreigner can’t buy the place …
Aren’t the rats the Jews’ fault?
Just wondering… I’ve been reading some political
blogs in Hungarian and it seems the Jews are
responsible for the high utility prices, so why not
the rats?
Unfortunately, there are no Jews left in the
provinces, but that’s something the village
residents know all about…
Wolfi. There are thousands of similar houses in various outlying villages like the “shed” shown above which have been sold to Brits and Irish in recent years.
The “draw” is the fact that they usually come with large tracts of land which gets the greedy investors juices flowing.
In essence the land is worth nothing at the moment unless Tesco or Auchan come knocking at your door.
A further blow which I know you are aware of is that FlyBalaton closed down and now the investors are howling even louder.
I believe agricultural land should not be sold to foreigners?
I think building and agricultural land is classified differently as “inner” and “outer” areas at the föld hivatal – land registry office?
Perhaps Erik can throw some light on this issue??
@JackBlack:
You’re right – I have bought my house and the land in the “inner” area of the village in 1998 (after the law was changed to allow foreigners to do this), but I could not buy the adjacent terrain, so I rented it forever …
I know that many people founded a KFT to be able to buy some “outer” land, including a “pince” and built a “summerhouse” there. Some also used this KFT construction to buy in the “inner” region before 1998 – now some of them have problems liquidating the KFT and transfering ownership to themselves or their family …
I know a lawyer who told me it’s a real legal nightmare often …
You can’t be limited in your thinking. If an owner of a property, whether Hungarian or not, doesn’t pay his/her taxes on a property, the property should be sold at public auction by the city or county to pay for the taxes. The remainder of funds (if any) to be placed into an escrow account and held by the governmnet until the previous owner signs for it. The previous owner should be notified 6 months before the property goes up for auction. The letter to be sent to the official address the owners last left for the city records department. If they pay their taxes, they keep the house, if they don’t the government sells it as “abandoned property”. Get off your liberal horses…
Jackson. What taxes? I don’t own a horse and I’m certainly not a liberal.
Wolfi. I think the following article goes someway to explaining the rules:
Wolfi. I think this makes everything clear:
“European Union citizens may freely acquire commercial and residential property
if they plan to establish their main residence in Hungary. EU citizens may not acquire
secondary residencies and agricultural land until after 1st May 2011.
At the moment agricultural land may not be acquired by Hungarian legal entities
or foreigners except for farms not exceeding 6000 sq.mtrs. with a dwelling house.”
A permit issued by the local authorities for the purchase of property or land
by foreigners is essential for any deal to be valid.
(Source: Real Property Investment Law in Hungary).
PS. Erik. Help. If Jacko doesn’t know about house tax can you oblige. To whom do we pay and how much???
Are you on drugs? PROPERTY TAXES! Your part in the local community, right? I can’t believe how backwards some freeking people are. Are you still in the 2nd grade or just stupid? Taxes are how your government PAYS for things. Right? Schools, police, health care. What the hell is the matter with you? Do you now understand? You can’t just allow something to turn to crap because you abandon it. Once you abandon something it becomes a problem for everyone. Thus, your government can auction it off and sell it to someone who gives a shit about it. Right? Hello? Anyone home?
Let a Hungarian buy it back at auction for the taxes owed in property taxes…. Right? If the taxes owed are 120,000 FT, then it can be bought for a minimum of that amount, right?… So why shouldn’t a Hungarian be able to buy it back… Right?… THINK! The whole Country is full of abandoned home which should be auctioned off to people who would care and live in them. They could get a 5 M old house for highest bid.
@JackBlack:
Thanks again, but I’m not sure that “EU citizens may not acquire secondary residencies …” part is correct. I have a secondary residency here (and a card to prove it, got it at the county seat after showing my papers including some utility bills).
This also means I pay less tax for my house (like a Hungarian) and get free treatment at the local clinic (which I had to use once).
Maybe someone here knows how it exactly works.
BTW:
This “jackson” reminds me of someone who spent a long time here under a number of different names like donizelli, fantron …
I used to call him Panamajackass because he claimed to live there – his main characteristic was an absolute hatred of everything connected to Hungary, its people and the foreigners “having to live in this dump” …
I have only been here under Jackson and ShitStorm Jackson. Who cares if you have a house there, so do I. What I see is the same as was in the story. ABANDONED HOMES What the hell is so complex about that? There are houses that have been abandoned around 1990 and the government(s) can do nothing to help clean them up because they are cock-tied liberals. As long as Hungary believes that people can live like animals in their homes or buy a home and then abandon it and have it sit there for the next 50 years without the government having any rights to confiscate the home, you will have a nation which looks like a unmanicured graveyard. I can tell you are a Socialist…
Wolfi.I am drinking a bottle of wine and falling off my chair laughing at Jackson’s comments. I hope he sticks around we need livening up.
My question to you Wolfi is: what taxes do you pay on your house and when? And how are the costs assessed?
I was told (as a foreigner) I would have to pay
tax on the house when first purchased @ 2% on the first 4 milllion forint and 6% on the balance.
I pay community tax as well. But I am not aware of any other house tax.
Help?
@jackson:
Congratulations! Yesterday you were 16 years old, now you have a house “there” …
Tells us something about you, doesn’t it ?
@JackBlack:
Sorry, I overlooked your last posting. I really don’t know about the Tax level when you buy a house right now, I think they changed the rules, better go ask an expert there.
Anyway my house was almost a ruin and I invested almost as much as a new house would have cost …
About communal tax: Now that I have my papers that this is my second home, I only pay around 5000 forint a year – and that even includes garbage collection …
For a holiday home the tax would be much higher however.
Dear Mr Jackson,
The issue of property taxes is extremely relevant. It comes under public finance. Being American, I think you are used to a country that has systemitised it’s approach to such things, over time. In the earlier phase of American history, this was not always so, as the situation was evolving.
The situation is Hungary is also “evolving” and will continue to evolve for some time. The last 20 years can be seen as a “wild west” phase when it comes to public funding. Prior to that was the communist regime, which “funded” itself rather differently. Prior to communism was a post feudal or feudal order, where most property was held by a small group of mostly aristocrats who put themselves above any notion of a land use tax. Imagine “Prince” Eszterhazy with his 10 million acres being asked to pay “property tax”!
The whole idea is a new thing with Hungarians, and will take time to be more consistently applied and enforced to the point where it is dome elsewhere.
Do allow for the historical context. I once told you, that Hungary “is not Kansas!”!
Sorry, the above post was written by me. Without a username, it comes up as “anonymous”.
Around here I am never intenionally “anonymous”, nor do I invent alter-identities, nor have I ever posted or ever will post under any other username than “Farkas László”
That is your prerogative. Freedom of speech is available to everyone. Man of a thousand soubriquets….a mighty crime that is!
FL. Thieving toerags that repeatedly steal from the public coffers need to be put in jail for a very long time. Forget about Esterhazy and Kansas – concentrate on pointing the finger at communist politicians and their lickspittle bureaucrats.
You are educated and wise enough to know that communism is the root of all evil? I think so, anyway.
Dear PickandMix,
I was addressing Jackson who wonders aloud, and somewhat harshly, why Hungarians haven’t gotten the property tax issue sorted out. I told him.
Now should the state of afairs continue? No. The country he claims to be from, the USA, didn’t always have this issue sorted out, especially earlier in it’s history. Should we fix it? Of course.
Communism is the source of many evils, especially the ones that continue to plague Hungary’s national life, politics and governance. Almost all of the ex-communist block countries have a “legacy” problem with it in some form or another.
Just to clarify a couple of things:
1. EU citizens are certainly allowed to purchase secondary residences without any further permissions from May 2009. Non EU citizens need to go through the administration office procedure to get the permit to purchase (which they usually will get).
2. Land tax/building tax/communal tax: the Government only sets the maximum “frames” for these kind of taxes, every Municipality can decide whether they collect these taxes or not. Obviously quite a lot do. The maximum for building tax is currently 900 HUF/m2/year. Some municipalities combine the building tax and communal tax, and collect both.
There is a way to reduce these taxes, if one asks for a “residency permit” (quite straightforward procedure), as the Municipalites decrees make a difference between people who have a valid Hungarian adress, and those who haven’t. Obviously the one’s who haven’t got one, pay more…
3. Arable land: this is the type of real estate (orchards, ponds, forests, agricultural land,etc.) which cannot be aquired by anyone else but Hungarian individuals. There are a few exceptions though, but this is the main regulation!
Cheers
@Chris: Thanks for the clarification!
Yes, this “residency permit” is what I got in Zalaégerszeg and it also means that as local residents we pay around 40% less for the spa in Heviz.
Regarding arable land, there are ways around those restrictions: Found a KFT (or BT ?) for agricultural production (like wine) and build a “pince” …
Nice to hear from you Chris. Not all strictly true what you write. But near enough for non-taxpayers.
If you can prove you sold your house to finance
the purchase of House in Hungary the purchase house tax should be waived.
There is at the moment EU legislation being drawn up to ensure Hungary abides by the rules. It hasn’t in the recent past. Still a commie MSZP government you see. How was the Nyelvtan book?
wolfi: Obviously there are always ways around…but I am not keen of those.
Idegen: its two completely different things we are talking about. I did not write anything about the stamp duty (property aquisition tax).
My comment was about the local taxes.
Please correct the part of my comment which was not “strictly true”. I’d like to have it put right you know…
By the way, I think you are mistaken by my name… I don’t know anything about a Nyelvtan book.
Ok Chris. I mistook you for someone else of the same name.
I only pointed out the “acquisition” tax as you call it because it is under scrutiny at the moment
at the EU. Basically, they say it is illegal, and must not be applied. Also if you can prove you sold your house to finance the new purchase, this should remove you from any necessity to pay the dreaded tax anyway.
With regard to the other issues surrounding tax on property etc. There have been so many amendments that it is hard to keep up. Central and local government appear to apply different rules anyway.
The whole tax situation in this country is a dog’s dinner.
It is best to seek the advice of a solicitor on any real estate deal that you undertake.
Posting general comments on this site can lead
to ambiguity and uncertainty. Leave it to the professionals.
Can someone explain to me why spa baths in Hungary are allowed to charge diferantly for some of its customers ie cheaper for locals, I read here that Harkany Spa had been fined by the EU for this practise but when my family paid a visit I asked for pensioner reduced rate and was told because I was not Hungarian the answer was no and that the Spa directer couldnt give a damn!! about fines!!
Consequently we will never use these facilities again.
JEM. The commie bureaucratic bastards in Hungary
have their days numbered. Please exercise your rights for discounts if you are senior citizens.
I can speak some Hungarian and this helps enormously. I recently had a chimney sweep turn up asking for money for cleaning my chimneys. Just one problem. I haven’t got any chimneys. I told him to fuck off. Apparently this is understood in any language.
Hi Chris,
I saw your sumamry of the current “rules” under which EU citizen can buy property in Hungary.
Your also mention that arable land can not be acquired by foreigners (ie non Hungarians). However I understood this is about to change 1st of May 2011.
Does anybody know what this means in practise? Does each EU citizen has in that case the same rights as the Hungarians? (and can buy basically all type of property in each location).
Chrs,
Jeroen
Hi Jeroen,
well according to the present regulations it is
not possible to aquire ownership of arable land,
however there are exceptions: if somebody buys a
farm (in hungarian “tanya”) with a max. of 6.000
sqm of land.
An other exception is: if somebody can proof that
lives here in Hungary for a while (i think 5 yrs)
and is involved in agriculture (has an
agricultural enterprise) for living.
In any other cases, the ownership – officially –
can be aquired. There are obviously ways around
that… Theoritically it is said, that in 2011
this regulation will be reconsidered, and if it
would cause serious problems (ie. social,
economic, structural problems in agriculture,
etc.) then the moratorium could be extended for
another 3 years.
The new govt. (FIDESZ) has announced that they
will do their best to “protect” Hungarian land
from the speculative foreign buyers. What that
will mean in practice… nobody knows yet.
Sorry I forgot about one word in the following
sentence:
In any other cases, the ownership – officially – can
NOT be aquired.
Makes a difference…
@Chris&Jeroboam. Hungary and Hungarians never took to wearing democratic shoes these past twenty years. Cramps their style somewhat.
The old ways die hard and seem better to suited to “graft” and penny pinching and/or forint filching.
Arable land? No proper drainage system, flooding, crops either rotted by too much rain or too much sun.
Grandma and Grandpa sitting on acres and acres of unworked land suddenly die and it’s passed to sons and daughters that live and work in America, Canada, or other parts of Europe and want rid of it at any price.
In short, another right farce in the agriculture and fisheries department.
The vultures in the sky circle and wait to buy up said land for a peppercorn and build a supermarket, shopping mall, or office block, car park and so on.
Rules are made to be broken and, in Hungary, all you need to have is the right solicitor and a brown paper parcel with the “readies” and you’re laughing.
BTW. Hungarians already flout the law every-which-way to their own advantage. So why is the government so concerned about land that nobody cares about or wants? Roma drifting in from every forgotten territory to squat and take advantage of the more than generous Hungarian welfare system that’s who!
Mass unemployment? No problem! Orban must get his priorities right – dual citizenship, censuring holocaust denial, and fighting with the governor of Magyar Nemzeti Bank.
Too many houses have that sign “Eladó” – I’m not so sure about arable land, but it’s probably similar, from what I see around …
My neighbour’s son in law tries valiantly, he has taken over part of the old “TSZ” – but at the prices he gets for sunflower and corn …
And we live in a kind of privileged part of the country near Héviz. My wife’s relatives tells me it’s much worse east of Budapest.
@Chris – So basically something is planned for the 1st of May 2011 but details are unknown :-/. Nevertheles my understanding is that your new government is right winged liberal and should be more in favor of entrepreneurs. Now protecting the land against speculators is something which I can understand. You do not want big investors walking in, buy lots of land, do not deploy it and wait till bio-mass industry picks up in 30 years and sell it.
What about the natural reserve / protected areas – are they also “arable land”? E.g. is it in the future possible for EU “foreigners” to buy a secondary house (for holiday) in such an area. Around the Balaton lake there are some of those protected areas. Officially up to now you can not buy property as EU foreigner … of course there are ways around as you mentioned Chris.
@Wolfi / Ingatlan – that property prices go down is not surprisingly. Population is decreasing, Hungarian (& goverment) live beyond one’s means, housing speculation took place massively in our last financial “sky is the limit” bubble, reduction of Hungarian average income etc. etc. Let’s see what the future brings – I expect stabilization over the coming years in certain geographical areas
It is no use relying on governments in Hungary to sort out the mess. They actually contribute to the fiasco. Private enterprise and entrepreneurial endeavour should be allowed to flourish without state intervention and the dreaded bureaucracy that accompanies it.
Opportunist speculators that want to buy land and “sit” on it until prices improve sometime in the distant future should be avoided at all costs.
Hungary has great potential. The problem is that it is mismanaged at every level. And we go round in ever decreasing circles trying to apportion blame without cracking the nut that contains widespread inefficiency and unsustainable malpractice in just about every area of our lives.
Due to State intervention in every stage of your adventure in Hungary many buyers pull out.
Bought a tanya with 80 m2 szölö as a part of 2880 m2, but cannot get a ‘Közigazgatási engedely’ because this is ‘thermöföld’ and it should not be bought by ‘foreigners’. When it comes to € tamógatás Hungarian are NOT foreigners at once.
Bye bye Hungary.
I’ll invest in a less burocratic and önfejes Country.
@Jackson “Hungarian or not, doesn’t pay his/her taxes on a property, the property should be sold at public auction by the city or county to pay for the taxes.”
I agree with you Jackson! This is what they should do…