Why Is Hungary Ending the Real Estate Investment Option?
Launched on July 1, 2024, the GIP, also known as Hungary Golden Visa, aimed to attract foreign investment into the country’s economy. However, less than a year later, authorities decided to discontinue the real estate investment pathway, citing concerns about housing market pressures, rising property prices, and market stability. Despite this change, the program still permits a €250,000 investment in approved real estate funds, making it slightly more flexible than Portugal’s program, which also terminated real estate investments for funds.
According to the Hungarian government, shifting focus to real estate funds rather than individual property purchases aims to stabilize the housing market and prevent unchecked speculation. This new fund-driven model is designed to enhance regulatory oversight and ensure that investments contribute to sustainable economic growth.
Current Options Under Hungary’s Guest Investor Program
With the elimination of real estate investments, Hungary’s GIP now offers two pathways to obtain residency:
- €250,000 investment in approved real estate investment funds.
- €1 million donation to public education and cultural initiatives.
Investing at least €250,000 in approved real estate funds allows investors to qualify for the program. Unlike direct property purchases, this option lets authorities channel investments into priority sectors, such as residential developments in low-density areas or commercial projects.
Alternatively, investors can choose to make a €1 million donation to public education or cultural initiatives. While this option does not provide a return on investment, it supports meaningful projects that contribute to Hungary’s social and cultural development.
Following a European Trend: Lessons from Portugal and Greece
Hungary’s decision to phase out real estate investments aligns with similar measures taken in Portugal and Spain, which have restructured or eliminated real estate options under their Golden Visa programs in an effort to address housing affordability and speculation. Portugal, for instance, ended its real estate pathway in October 2023 but retained alternatives, including €500,000 investments in funds and other donation-based options.
Greece, however, continues to lead Europe’s Residency by Investment landscape by maintaining a robust real estate investment pathway under its Golden Visa program. Unlike Hungary, Greece has implemented measures to balance housing market dynamics while preserving the appeal of its program. For investors seeking real estate-backed residency options, Greece remains a compelling choice with well-established regulations and strong demand in its property market.
Why Real Estate Funds Still Hold Promise in Hungary
Despite the discontinuation of direct real estate purchases, Hungary’s real estate fund option offers an attractive alternative. By pooling resources into regulated funds, this model provides greater security, transparency, and oversight. Investors benefit from professional fund management while contributing to projects that align with Hungary’s development goals.
Real estate funds also reduce risks associated with market volatility and speculation, making them a strategic choice for those looking to invest in Hungary’s growing property sector. Whether focused on residential, commercial, or mixed-use developments, these funds offer a streamlined way to achieve returns without the complexities of direct property ownership.
Opportunities Beyond Hungary: Why Greece Stands Out
For investors disappointed by Hungary’s policy change, Greece offers an outstanding alternative for real estate-based Golden Visas. With a minimum investment of €250,000 in qualifying properties, Greece’s program is both competitive and comprehensive. The country’s booming tourism industry, strong real estate market, and favorable tax policies make it an appealing destination for foreign investors.
Greece’s Golden Visa also provides significant lifestyle benefits, such as visa-free travel across the Schengen Area, a high standard of living, and access to a vibrant expatriate community. As one of Europe’s most sought-after Residency by Investment programs, Greece continues to set the benchmark for success in this space.
Your Partner in Investment Visa Opportunities
At Investment Visa, we are dedicated to guiding investors through the complex world of Residency by Investment programs. Whether you are considering Hungary’s real estate funds or exploring Greece’s Golden Visa, our team of experts is here to offer personalized advice and tailored solutions.
Contact us today to learn more about your options and take the first step toward securing your European residency through strategic investments.
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