The main dilemma is the difference between the purchase price and the state subsidies available for purchase (CSOK, capital write-off, interest-subsidized home loan).
Do the majority of real estate search and buying families hesitate to buy used or new real estate? There are many benefits and drawbacks to both types.
Real Estate Thoughts
For a newly built property, the buyer will not only be able to choose the coverings, but will avoid any renovation work that must be done on a used property. However, used real estate is cheaper than new real estate, although recent trends are no longer such a difference between the price of a used and new real estate on the market, thanks to several elements of the family support package that will be launched on July 1st.
What kind of non-refundable subsidy and discount home loan can I apply for in a used home?
Families may have different levels of CSOK support and discounted home loans when purchasing a used property:
- For two children, you can apply for $ 1.43 million in CSOK and $ 10 million at a 3% discount home loan.
- For three children you can apply for HUF 2.2 million CSOK and HUF 15 million 3% discount home loan.
- For four or more children, the amount of the CSOK is 2.7 million HUF and the 3% discount home loan is 15 million HUF.
Of course, this can also be compensated by applying for a market-rate home loan.
Several changes have been made to the terms and conditions of use of CSOK since 01.07.2019:
- The upper purchase price limit of HUF 35 million previously used for used real estate was abolished. That is, CSOK support is available even if the price of the property to be purchased is higher than HUF 35 million.
- A further relief is that it is no longer necessary for the real estate purchaser to invest the full purchase price of the property previously sold in the house or apartment to be purchased.
What kind of support and subsidized home loan can I apply for in a new property?
As before, the number of children in the case of newly built houses and flats determines the amount of subsidy and preferential housing loan.
- For two children, you can apply for 2.6 million HUF CSOK and 10 million HUF 3% discount home loan.
- For three or more children, you can apply for 10 million HUF CSOK and 15 million HUF 3% discount home loan.
What can you do if you do not have the necessary Self-Power?
In the vast majority of cases, the above-mentioned preferential home loan amounts and government subsidies do not yet provide sufficient funding to cover the full purchase price of the property. Carefully calculated, buying a property may require up to 30% of own funds, as some banks may have stricter regulations than the law. According to the debt brake regulations, 80% of a property can be encumbered. Thus, the MNB makes the existence of 20% of own funds obligatory. How much do you need then? One thing is certain, given the current real estate market prices, it could be millions of forints.
What can be done?
Include replacement real estate so that the bank takes as a basis the total value of the property. This allows you to make purchases without your own resources.
What if there is no other property in the family?
You can apply for the Baby Waiting Loan (Baby Waiting Grant) as it is a free-of-charge unsecured loan that will remain interest-free until the end of the term (after the birth of a child) if legally required. Moreover, there may be state subsidies for multiple births.
You can take out a personal loan, which is an unsecured but market-rate loan.
In our opinion, it is not possible to decide whether a new or used property is more beneficial to the client. Many subjective elements also contribute to the decision in addition to the above. Whatever you decide on whether you are new or used is worth considering!
Want to know what kind of government subsidies you have and what discounted home loan schemes are available to you? And how much better is it if you use everything? If so, please fill out our form and our credit brokerage specialists will help you find the most appropriate form of financing and support.