Hungary is a developed country in Eastern Europe with high quality of living to foreign investors. Hungary became a member of the European Union on 1 May 2004 and officially joined Schengen area in December 2007. Hungary uses Forint as national currency, however euro is widely used and accepted all over Hungary. Budapest is a charming capital on the banks of Danube river, visited by millions of tourists every year.
Hungary ran the Golden bond residency scheme from 2013 and 2017 . But, in Nov 2023, Hungary has reopened the Golden visa program, introducing a “Guest investor visa” program to revive the real estate market, providing residence permits to foreigners to invest in luxury real estate properties. The Guest investor permit applications will be accepted by hungarian authorities starting from July, 1 2024.
Legislation
The President of Hungary has signed the T/6097 decree on Guest investor visa (“vendégbefektető vizum”) and now has been published in official gazette on 21.12.2023 officially becoming a law, thus officially opening the Hungarian golden visa program for property investment in Hungary.
Benefits
– Best Golden Visa in Europe
– Fastest growing property market.
– Low corporate tax rates (9%)
– Free movement in Schengen area
– Attractive Investment destination in Europe.
– Major Trade hub with Excellent flight connections.
– Path to Hungarian Citizenship
Guest Investor Visa
GIV was launched based on to a Bill passed by parliament, on the entry and residence of third country nationals. The Guest investor visa can only be applied
The Guest investor visa can be obtained by a third-country citizen whose entry and stay is of national economic interest in view of his investments in Hungary, or who submits a written undertaking that he undertakes to “implement an investment of a certain amount and type within three months of entering Hungary with a guest investor visa”.
Important: You must come to Hungary in Person. The Golden Visa application can only be filed within Hungary. You must have a valid schengen visa or have a passport visa free country (eg. US, Canada, Singapore, Hong Kong, UK etc.) to be able to physically visit Hungary and apply here. We do not assist with applying for visas.
The bill also defines eligible investments amount, namely:
1.Real Estate Fund (REF)
Acquisition of investment bond certificates of at least EUR 250,000 issued by a real estate fund registered with the Hungarian National Bank. Investment must be kept for 5 years and residence permit issued for 10 years with another ten year extension.
2.Real Estate
Investment in residential real estate with a value of at least EUR 500,000, located naturally in the geographical territory of Hungary, registered in the real estate register according to the topographical number. Investment must be kept for 5 years and residence permit issued for 10 years with another ten year extension.
3.Monetary Donation
A monetary donation of at least EUR 1,000,000 to a higher education institution maintained by a public interest trust foundation performing a public task for the purpose of supporting educational, scientific research, artistic creative activities.
Guest Residence Permit
The National Directorate-General for Aliens Policing will process applications starting from 2024. The Guest investors will receive a residence permit indefinitely valid for upto 10 years with indefinite ten year extensions on the pre-condition that investment is maintained. Family members also qualify.
Residence Condition
No requirement to live permanently in Hungary as long as the investor maintains their investment. They need to come to Hungary for biometrics once infront of immigration office and for renewals. Those applying from abroad need to apply for long term “D” national visa to come to Hungary to receive their residence cards.
Property Market
The real estate prices in Hungary, particularly in capital budapest, is the still low compared other major european cities, makes it attractive for foreigners to invest in properties. The Property prices in capital floats around EUR 2,500 to EUR 3,000 in downtown districts of 5 and 6. Lake Balaton area is super popular with Germans, French, Brits and other europeans.
Property taxes
Companies or legal persons can also buy properties.. Buying an apartment in Hungary is a straight forward process. The paper work for this is always prepared by the lawyer when the contract of sale is signed with usual 10% deposit and sale registered in 30-60 days.
- Registration costs – 4%
- Lawyer fee 1%
- Broker commission – (Paid by seller)
- VAT 5% (only for newly built properties)
Note: If you buy a land and construct a house on it within 4 years, property tax can be reduced to 0%.
Best Locations – The top locations to buy a property in Hungary are
- Budapest (Downtown districts I, II, III, V, VI, VII, IX, XI) and most expensive Districts XII and XIV
- Lake Balaton Riviera (Siófok, Balatonfüred, Balatonalmádi, Keszthely, Zamárdi, Balatonkenese and Fonyód )
- Other Cities ( Debrecen, Szolnok, Pecs, Gyor, Szeged, Eger)
Capital Gains Tax
Capital gains tax is applicable when a property is sold within 5 years of purchase. The rate is 27% for residents and 32% for non-residents. If a property is sold after 5 years of purchase, then the rate is reduced to 20%.
Income Tax from rental income can vary from 15% to 35%.
Wealth Taxes
There is no net wealth/worth taxes in Hungary. The general inheritance and gift tax rate is 18%, and a preferential 9% tax rate applies to residential property.
Permanent Residency
Hungary grants two types of permanent residence permits to foreigners based on habitual residence. The National residence permit is granted after 3 years of living and EC permanent residence after 5 years of continuous living without absence.
Hungarian Citizenship
Investors can naturalize for citizenship with PR status after 8 years of residence. Applicants must have no criminal record, satisfy necessary subsistence and also pass civic and hungarian language test.
Hungary Passport
The Hungarian passport (“Útlevél”) is a powerful EU travel document with visa free access to 186 visa free countries in the World.
The Hungarian government has relaunched the golden visa program in 2024. The Hungary guest investor visa scheme (aka golden visa) is currently open for foreign investors, who make property investment in Hungary. Foreign investors can receive a ten year residence permit based on national economic interest for their investments.
FAQs
Below are frequently asked questions. If you have any questions, please contact us for a free consultation.
What is Hungary Guest Investor Program?
Under the Guest investor program, third-country nationals are eligible to be granted a residence permit (golden visa) for guest investor, whose entry and stay in Hungary is in national economic interest due to his/her investments realised in Hungary. EU/EEA nationals cannot apply.
Is the program open and currently receiving applications?
Yes, the program accepting applications from Jul 1, 2024.
What are the benefits of the program?
Foreign investors who make a qualifying investment can enjoy the following benefits.
– Immigrate to Europe to a safe, peaceful country with high living standards.
– Residence card issued for 10 years.
– Live, Study, and Work in Europe.
– Free movement in the Schengen area.
– No minimum residence conditions.
– Refundable real estate investment with annual returns.
– Minimum 5 year investment period
– Hungarian citizenship (EU) after 8 years of living.
What is the legal background?
The President of Hungary has signed the T/6097 decree on Guest investor visa (“vendégbefektető vizum”) and has been published in official gazette on 21.12.2023 adopted new Immigration law from Jan 1, 2024 on the entry and exit of third country nationals, thus officially opening the Hungarian golden visa program for property investment in Hungary.
What are the eligible investments?
There are there investment options..
1. Investment Fund – acquisition of an investment fund share of at least EUR 250,000 issued by a real estate fund registered by the Hungarian National Bank. The investment fund share issued by a real estate fund for at least 5 years whose net asset value comprises minimum 40% of investments in residential real estate in Hungary and its real estate fund manager has at least a simplified site security certificate or is listed in the register under Act XXX of 2016 on Defence and Security Procurement.
2. Real Estate – Ownership interest over a property, concerning a residential property with a value of at least EUR 500 000, located in the geographical territory of Hungary and registered in the Land Registry of Hungary under its parcel identification/topographical LOT number, free and clear of all liens, claims and encumbrances. upon acquiring ownership of the residential property, a prohibition on alienation and encumbrance must be registered in the Land Register for a period of 5 years from the date of conclusion of the purchase contract, and the property may be owned exclusively by you or you and one or more family members who are also applying for a residence permit for guest investor for a period of 5 years. Please also be informed that the competent authority will appoint a forensic real estate expert to determine whether there is a noticeable discrepancy between the actual market value of the property and the purchase price indicated in the application. The applicant must advance the costs of the assessment.
3. Public Donation – financial donation in an amount of at least 1,000 000 EUR and for a purpose of educational, scientific research or artistic creation activities, to a higher education institution maintained by a public trust with a public-service mission.
What are the conditions for investment?
You must within 3 months after entering Hungary that you have completed the committed investment. Certification of the realised investment will be examined by NDGAP authority.
Where can I apply?
If you already hold a Schengen visa or visa free entry, application can be filed at National Directorate of Aliens Policing (NDGAP Immigration authority), as per your place of accommodation for biometrics and collection of residence document. The facial photograph and fingerprint of the applicant is taken and signature specimen of the applicant is recorded within 15 days from the date of receipt.
Do I need to live in Hungary?
No. There are no minimum residence conditions specified.
What is the processing time?
The procedural administration: 21 days, but please expect unto 3-4 months until receiving residence card.
Can I appoint a proxy or authorised person?
Yes you can appoint a lawyer or legal person to represent your case with the immigration authority.
Can stateless people apply?
Yes, they can, under the relevant laws.
What are the conditions of extension of Guest investor permit?
The extension residence permit is only possible if you are a holder of a valid residence permit for guest investor at the time of application submission. please note that an application for the extension of a residence permit is to be submitted at least 30 days prior to the date of expiry of the issued residence permit.
Conditions must be met
- if the investment on the basis of which the residence permit was issued was an investment fund share, the applicant is required to have the investment at the time of application submission,
- if the investment on the basis of which the residence permit was issued was ownership interest over a real estate property, then the applicant continues to have ownership interest over the property based on which the residence permit was issued with a value of at least EUR 500 000, or if the applicant no longer has ownership interest over the property based on which the residence permit was issued, or the value of the ownership interest over the property is less than EUR 500 000, the applicant has a new real estate investment meeting the same conditions at the time of application submission,
- if the investment on the basis of which the residence permit was issued was provision of a financial donation, the extension of the residence permit may be granted without further investments realised.
What documents are required?
- Valid passport
- a certificate from a credit institution under the applicant’s name (e.g. a bank account statement, an account statement on savings or stocks and bonds, bank balance statement),
- a document on regular income issued by the employer or the tax authority.
- a residential lease contract or a document in proof of ownership of the residential property,
- Health insurance
- Other documents (as required)
What is the validity period of residence permit?
Validity period of the document is granted in 10 years, and it may be extended for another 10 years (only once) for the same purpose.
For How long I can visit other Schengen countries?
Maximum 90 days in 180 day period for visits, business, study, tourism only. For stays more than 180 days (eg. Study) you must apply for a separate residence permit in that country.
Who are eligible family members?
A family member of a person in possession of a investor residence card can include
- the spouse of the third-country national (including registered partner under Act XXIX of 2009),
- the minor child (including adopted and foster children) of a third-country national and his/her spouse,
- the dependent minor child (including adopted and foster children) of a third-country national where this third country national has parental custody,
- the dependent minor child (including adopted and foster children) of the spouse of a third-country national where the spouse has parental custody,
- a person having and exercising parental custody of a minor Hungarian child and living in the same household with the minor
qualify as family member. A residence permit for the purpose of family reunification shall be issued to the third-country national child born in Hungary of a third-country national residing in Hungary with a residence permit.
Can I work under investor guest permit?
Yes you can work in Hungary (To work in other EU countries, you must apply a separate work permit).
Investor – The residence permit for guest main investor entitles its holder to pursue activities independently, for remuneration or act as a chief executive of a business organisation, cooperative or other legal entity established for the purpose of gainful activity.
Family member – The residence permit for guest investor family members under family reunification entitles its holder to perform actual work for or under the direction of others, for remuneration, under contract for employment relationship.
What if my application is refused?
The decision may be appealed within 8 days of delivery, submitted to the authority of first instance, or at the Hungarian diplomatic or consular foreign mission where the application was submitted.