The Budapest airbnb by roller coaster
Since the summer, a lot has changed in the market for short-term accommodation publishing in Budapest. After an extremely difficult start to the year and a slow early summer start, the apartment publishers in the capital, which had survived the plagues of the virus so far, were able to reach more and more beautiful numbers in the second half of the year.
As more than two-thirds of the accommodations have disappeared from the Budapest market – the property has been rented out for a long time – the property has been able to choose from a much smaller selection than before.
And landlords did not behave rationally and did not reduce prices, did not continue the extremely harmful pre-epidemic price competition in the face of inflation or rising costs, but by the autumn of 2021, prices exceeded the record year of 2019, although they are still lagging behind. from the capitals of the surrounding countries! Meanwhile, the occupancy rate of homes remaining on the market for the autumn months reached and even exceeded 2019!
As a result, it opened up to recoup some of the accumulated losses in the first three quarters of the year and look to the new year with confidence.
Further accommodation increases are needed. Real estate prices are rising again after the stagnation in 2020, a cleaner can only be found at the price of gold, inflation has risen, the tax burden is rising, meaning that if someone wants to make a profit – long-term renting is not possible for some time. Because due to the weakening of the forint, if the host advertises in forints and the guest pays in euros, the guest will not even notice a small (forint) price increase.
It is gratifying that, thanks to the work of the Hungarian Tourism Agency, tourists have to return to Budapest, and later they prefer apartments that offer greater security and segregation to hotels, which entitles them to previous trends.
At the same time, there are plenty of other factors that make life difficult for landlords. The use of a document reader is mandatory from last autumn, the 4% tourism development contribution (TFH) will have to be paid again from January, and the classification of accommodation establishments under stars will also be mandatory from January, similar to what is known at hotels.
It took a lot of work and consultation with the Hungarian Association of Apartment Publishers to understand with the Hungarian Tourism Agency (MTÜ) that
the Ministry of the Interior’s idea that it would be quasi-mandatory for hosts to meet in person at admission and to request their documents in person was flawed. It doesn’t want guests, it’s not “virus-proof,” it’s not up-to-date, it doesn’t have enough manpower, and it costs a lot.
So it embodies everything that tourism would go backwards and not forward. Finally, after the introduction of the system, approx. two and a half to find a successful solution to the problem. It would have been good to save the daily annoyance of tens of thousands of hosts and the effort to circumvent the system during this period.
We were very pleased that the CEO of MTÜ, dr. During Zoltán Guller’s personal effort, at the last minute we managed to bring together all the other criteria for classifying accommodation that affect private accommodation, so that it is not impossible to reach thousands of accommodation providers. The original draft did not take into account the diversity of this market; If this had happened, many accommodation establishments would have been classified in an undeservingly worse category (1-2 star accommodation) than would have been justified, and this would have had a negative effect on revenue, occupancy, and many would have stopped working permanently. The proposal made by the Hotel Association for our sector was therefore fundamentally flawed. We are glad that our association and the CEO of MTÜ have intervened in time!
Meanwhile, double administration continues to plague hosts. The tourist tax return is still to be sent to the municipalities on a monthly basis, and in principle they first see the mandatory daily traffic data sent by the hosts to the National Tourist Information Center.
Why do they still stick to the old, well-proven method? Because the state program does not calculate in HUF exactly, so it is not suitable for preparing a tax return, although this was the promise made earlier. If Hungary wants to go forward and not backwards, such mistakes, which can be corrected quickly, will not be tolerated, because they will undermine the competitiveness of the sector and the confidence of accommodation providers.
We are very confident that this year’s multi-year request for private landlords to finally report their income on their annual PIT return and finally become creditworthy will finally come true. At present, despite the fact that many thousands of hosts belong to the middle class, in normal years they have an average or higher income, banks do not lend to them because their income is “not visible”, they do not receive a certificate from NAV like KATA entrepreneurs. With the loan, accommodation providers could develop, consume, expand employment and generate tax revenue. It is incomprehensible why it does not cost the state a penny to take action to provide new settings for many thousands of families. We are very confident that MTÜ will increase its lobbying activity in this matter with the Ministry of Finance.
There is a lot to be done in the market of private accommodation and tens of thousands of other accommodation, which provides a livelihood for many thousands of micro-enterprises and families, so they leave the profits at home, as opposed to many multinational hotel chains. Domestic tourism is managed from unprecedented sources and has never been available to industry leaders to make the right decisions. And the attraction developments, successful marketing campaigns, accommodation upgrades, the challenges of our accommodation type are sometimes going on with steam, as if they were stepchildren. It does not help that the chair in charge of accommodation has a long stay, or that highly qualified professionals work in the top of tourism management in Hungary, so they can turn to hotel problems with sufficient sensitivity, but experts in private and other accommodation seem to be short of staff. of. This, in spite of all good intentions, is unfortunately sometimes seen in avoidable mistakes, with many thousands of accommodation providers standing up for it or just getting angry about an unprepared decision.
During Budapest, it is as if he is asleep and waiting for the tourists to return on their own, or the MTÜ will lure them here. There is still no breakthrough in increasing domestic guest nights, and we haven’t heard much about foreign campaigns either. We can only deprive potential tourists of the city’s struggling tourism sector for almost two years by floating the World Athletics Championships, or it has been proven a thousand times that international competition events (Formula One, running races, etc.) can give a big boost to tourism. If the epidemic situation allows, there will be mass-bringing events this year. Here will be the start of the handball European Championship, the Giro d’Italia, after a two-year hiatus there will be an Island, there will be Formula 1 and running competitions.
In the autumn, Airbnb again turned to Budapest with an offer to help organize the collection of the tourist tax, and the municipality will send the money directly, thus pushing back any blackening. This solution, which works in thousands of places in the capital, would require some work and consultation from it, but it would benefit Budapest and the districts. There is no news about the job yet. Meanwhile, the experts of MTÜ and Airbnb are working together to make not only the downtown districts popular with tourists, but also Budapest and its surroundings.
The sector has been removed from the crossroads of the districts – temporarily? Thanks to the recent active enlightenment, there are no district politicians who can be taken seriously for years (there are still some in the capital’s local government) who would kick the district’s economy by ruining opening hours, destroying not only accommodation providers but also other businesses living in tourism. , and waive the taxes we paid. Instead, they seek to remedy the problems that are undoubtedly present in addition to the many positives of local tourism. Although the VI. The principle decree of the district has failed in the first place at the Hungarian Competition Authority, and it is expected that all districts will continue to seek solutions that can protect the interests of the residents. Instead of banning and questioning the legal legitimacy of new entrants (District V regulations), our association believes in proactivity and is campaigning among hosts for the voluntary placement of noise meters. Based on international experience and the opinions of many tens of thousands of hosts, a device that does not record such a sound and notifies the host / operator in the event of noise not only protects the host’s property (as it prevents damage in the event of a party). in condominiums and guarantees the right of residents to rest.
The last almost two years have been difficult, but experience shows that you can travel, when many people are vaccinated, tourists come and the apartments are sought after again. Budapest is beautiful, the programs are super and we have not forgotten that it is one of our trendiest destinations before the epidemic. We look forward to all the uncertainty in a strong year, a re-vibrant capital.