Participants at a roundtable discussion held at Susmus Café concluded that there is a housing crisis in Debrecen. Although many on social media dispute the existence of the problem, arguing that Hungary has an exceptionally high rate of owner-occupied housing, experts say the reality is far less positive. The entry threshold to the housing market has risen dramatically, the market has become distorted, and Debrecen’s rental prices are now comparable to those of the most frequently mentioned districts of Budapest.
On Friday, May 29, interested participants gathered in a friendly atmosphere at Susmus Café in Debrecen to discuss one of the city’s most pressing issues: housing. The event’s guests were Eszter Somogyi, sociologist and economist researcher at Városkutatás Ltd., and Mihály Dombi, ecological economist and local president of the Szikra Movement in Debrecen.
The entry threshold has doubled
Eszter Somogyi pointed out that although she has not examined Debrecen’s local conditions in detail, it is clearly visible that among Hungary’s major cities outside Budapest, Debrecen has experienced the most extreme and brutal price increases in recent years.
“House prices in Hungary have risen among the highest in European cities. A major role in this has been played by misguided, impulsive housing subsidy systems that consistently stimulate demand without expanding supply,” she explained.
According to the latest data from the Hungarian Central Statistical Office (KSH) and real estate listings, the entry threshold on the market has doubled. While previously the lowest segment of urban markets (the worst-condition used apartments) was priced around 20–25 million forints, this has now increased to 40–50 million forints. This sharp rise excludes not only low-income groups but also the middle class from home ownership.
The discussion also included the perspective of real estate developers (who were unable to attend in person due to scheduling conflicts). Based on feedback from Dryvit Profi Ltd. and Realiscon Ltd., they are trying to price below Debrecen market levels and specifically build modern, insulated small family houses tailored to young professionals. However, even these start at 63 million forints and are only available in settlements around Debrecen, not within the city itself.
Investors dominate the market, fueled by credit for the wealthy
Mihály Dombi highlighted the cognitive dissonance between developers and public commentators. While developers speak at conferences about landscaped environments and birdsong, in reality they are building “30-something-square-meter corridor-style barracks,” representing a 150-year step backwards.
He emphasized that politics has now also acknowledged the housing crisis, but government measures primarily benefit the more affluent. This is supported by data from the Hungarian National Bank (MNB) housing market report: in Hungary, 54% of housing loans go to the top 20% of earners.
Lower-income groups (the bottom 30–50%) are effectively excluded from bank credit, and thus from both subsidies and property ownership. As a result, investment-driven purchases dominate the housing market. In Budapest, this share already exceeds 50–55%, and similar trends are visible in large provincial cities: state-subsidized loans are used mainly by wealthier buyers who then rent out the properties.
Why is the situation worst in Debrecen?
According to Dombi, three major demand factors have combined in an unfortunate way in Debrecen, causing the city to surpass even most Budapest districts in rental and housing affordability:
The massive industrial investments (e.g. BMW): a highly paid foreign engineering workforce has appeared, while staffing agencies are systematically removing family houses and apartments from the market to accommodate guest workers. Since they pay per person, this significantly drives up market prices. (At the same time, “horror stories” have emerged about overcrowded, shift-based worker housing systems.)
The mass of university students: as a regional center, Debrecen attracts many students. However, instead of building dormitories, the University of Debrecen has been demolishing them, pushing students into the private rental market, which creates huge pressure every August–September.
Natural demographic movement: continuous demand from people moving in from rural areas and from local young residents.
It was noted that cities undergoing similar large-scale industrial development, such as Kecskemét or the upcoming Szeged, have not experienced housing market distortions comparable to Debrecen.
The absence of the rental sector and the ownership trap
In Hungary, housing policy has exclusively supported private ownership for 30 years, while the affordable municipal rental sector has continuously shrunk and deteriorated. Due to lack of funding, municipalities themselves are unable to maintain it.
In closing, the experts also analyzed the Hungarian cultural preference for home ownership. According to Mihály Dombi, this mindset is problematic for two reasons:
For many Hungarians, their only significant asset is their home. Behind the 93% homeownership rate are many people living in depreciating, non-renovatable rural properties from which they can never move on.
Geographical and social immobility is reinforced. Due to the lack of a flexible rental market, dormitories, or youth housing programs (“starter flats”), young people cannot begin independent lives, take risks, or move freely for work.
The housing market has become detached from reality: while in developing regional countries (Poland, Czech Republic) wages have followed economic growth, in Hungary real wage value lags behind V4 partners. The housing crisis thus also reflects underpayment of Hungarian workers, while prices are driven up by a non-competitive, oligopolistic construction sector and capital-driven profit maximization at the expense of wage earners.
