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In a week or two, the government has made several announcements that will certainly not leave the construction industry unchanged. The 5 percent VAT will now boost the work of the largest construction companies and the subcontractors they employ, while the EU’s building modernization incentives and the renovation program announced by Katalin Novák will generate additional demand for their work at smaller companies and retailers.
Why renew?
In addition to supporting families, there is another very important factor behind the promotion of renovations: the achievement of the emissions targets for 2030 set by the EU and therefore also assumed by Hungary. Buildings are responsible for 40% of the EU’s energy consumption and 36% of its greenhouse gas emissions.
The renovation of dilapidated houses equipped with outdated heating technology is also necessary because Hungary wants to reduce greenhouse gas emissions to 40 percent of 1990 levels by 2030.
For this, it is necessary to modernize the residential real estate park. According to the leaders of the VEP (Virtual Power Plant Program), nearly 60 percent of the 2.7 million domestic residential buildings would need complex renovation. This includes single-family homes and multi-apartment condos.
1117 Budapest, Budafoki út 215.
| 260 flat 28 – 91 subwaytwo floor surface 32.7 – 92 M Ft |
Delivery: 2021 Q3 |
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There will be plenty of time to spend supporting renovation.
In the case of condominium apartments, the owners will surely have a lot of ideas on what kind of modernization the maximum of HUF 3 million can be spent on, but in the case of many families, even heating modernization can add to the list. Most of the more than 4.3 million residential properties in Hungary are single-family homes, but only 5 to 10 percent of them can be said to be energy modern, according to a survey by the Hungarian Family Home Owners Association. , and 5 to 8% of them are ready for demolition. that is, it can no longer be profitably renovated, or because of its condition it is not really habitable.
The most energy efficient settlements in Hungary are: Budapest and Pest county, Szeged, Debrecen, Győr, Pécs, Kecskemét, these settlements have the most modern isolated properties, their share is approximately 10 to 15 percent of total real estate residential areas of the given settlement.
According to the experts at Knauf Insulation, only 20-25 thousand family houses in Hungary are renovated and insulated by their owners every year, which also means that if the renovation pace does not change, 1.8 million single-family homes awaiting energy modernization could be completely renovated in 82 years.
1117 Budapest, Buda-part tér
The key to all this: will technicalities bear the burden?
While the renovation program tends to affect micro and small businesses, the shortage of professionals in these areas is also related to major real estate developments, as the subcontractors serving them also employ professionals. Therefore, it is feared that the implementation of the two measures on January 1, 2021, that is, the reform subsidy and the 5% VAT on new housing, will again cause a shortage of professionals. László Koji, President of ÉVOSZ, gave a reassuring response to our request in this regard:
Construction and design companies now have 25 percent fewer orders than a year ago. From this it can be concluded that if the demand for housing in the housing market expands, there will still be sufficient capacity.
President of the National Union of Construction Employers (ÉVOSZ), Honorary President of the Budapest Chamber of Commerce and Industry, General Vice President, Construction Chamber of the Hungarian Chamber of Commerce and Industry
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The expert also spoke about the fact that housing companies themselves have tripled the number of new home constructions in the last six years, while the number of home renovations this year so far, before the announcements, has reached roughly 200,000.
I think there is no capacity problem.
However, it is also true that Construction companies consider the lack of good workers and qualified engineers to be the biggest obstacle to their market activity. So even in such a situation, when the performance of the construction industry is lower than last year, it is expected to be 4 billion HUF, just like in 2018, the biggest problem is the shortage of skilled workers. .
László Koji According to clients, this is what has put micro and small entrepreneurs and the self-employed in a difficult situation, especially not in Budapest.
Smaller businesses in rural areas are making up for their short lead times and have a hard time getting new ones. Government support for renovation puts micro and small businesses in particular.
the expert said, then added that recovery options and subsidies were expected to be subject to difficult conditions, as were previous CSOK and VAT recovery subsidies. “Obviously you need a written contract, with detailed technical content, you need to add a business, the money moves through the accounts. This can bring cleaning and whitening in the Hungarian home renovation market, where work without a written contract, black employment and salary are the most important. The measure is also expected to lead to an improvement in the level playing field. “
László Koji Regarding prices, he said that currently the construction demand has decreased, the order book is smaller, but the capacities are available, so in general the market situation is driving prices down.
1134 Budapest, Klapka utca 4-10.
| 232 flat 30 – 130 subwaytwo floor surface 35 – 110 M Ft |
Delivery: 2019 Q4 |
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