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Since 2010, housing policy in Hungary has been characterized by  a one-sided focus on the promotion of home ownership and subsidizing the middle class. The government had no answer to the unfolding housing crisis; since 2015 the growth of housing prices and rents vastly outpaced the increase in incomes.  This lack of policy response has left not just the poorest in society, but also workers in key sectors and young people lacking familial support struggling to meet their housing needs. These issues have affected urban households even more severely, which has also prompted even some government stakeholders to voice their critique.

As in other European countries, the most effective tool to address the housing crisis would be the enlargement of the public housing sector – as it was also recognized in the National Strategy for Social Inclusion. Today, the public housing sector consists solely of municipally-owned rental units, which makes up about 3-5% of urban housing units.

This new amendment of the Housing Law proposes the eradication of the EUR 3bn municipal housing stock, which would lead to the deepening of the current urban housing crisis. The proposed changes in the Law will

• hand over properties to the poorest dwellers that they will likely be unable to maintain (around 80% of the current municipal stock requires refurbishment), increasing the housing precarity and the threat of homelessness;
• create new opportunities for the housing mafia and encourages speculation;
• unfairly advantage tenants occupying newly-built and recently refurbished public units, many of whom came by these units through political favors in the first place;
• punish municipalities that have gone out of their way to address the housing crisis in the past; the municipalities that have invested in bettering and increasing their affordable housing stock;
• eradicate the already limited opportunities for those in dire need to attain housing through the redistribution of empty municipal units;
• rob municipalities of their current tools to manage household arrears and aid families threatened or affected by homelessness;
• worsen spatial segregation through the dissolution of subsidized housing stock, pushing low-income residents out of the city.

Through all these effects, the compulsory privatization of municipal housing units to sitting tenants will worsen the housing crisis and increase inequalities.  These politically motivated and deeply unfair changes in Housing Law, which go against European trends in housing legislation must be prevented.

13 May, 2021

Metropolitan Research Institute, Budapest

József Hegedüs one of the managing directors of MRI held a keynote speech at the UNECE ‘Housing governance to support housing affordability – Focusing on housing affordability challenges in the South-Eastern Europe’ Regional workshop which was organized on the 23-24th of February 2021.

In his presentation ‘Limits and Options for Affordable Housing Policies’, József touched upon the two main paradigms (Enable Housing Market and Housing for All) laying behind the given policy solutions to the housing affordability problem. József drew attention to the diversity of housing crisis (based on the size of inequalities, nature of the local housing market and the institution) moreover, spatial differences can be detected between stagnating and developing places even within countries. József emphasized at the end of his presentation that in prior to integrating lessons learnt from good practices into local housing policies and programs that are addressing housing affordability problems, good practices must be critically evaluated.

The recording of the Regional workshop is available on Youtube. Please find the video embedded here. József’s presentation starts at 18:35.

Find the Power Point presentation in English here.

The special issue of the European Journal of Homelessness with papers of members of the COST Action CA15218 “Measuring Homelessness in Europe” is online. Nóra Teller, senior expert of MRI is among the co-authors of the article “Measuring Homelessness by City Counts –Experiences from European Cities”. Read papers on migration and homelessness, hidden homelessness, making use of administrative data, and national and city counts in here.