16 pros and cons of a Hungary residence permit: what you need to know before relocation

11 benefits of Hungarian residence 

1. An opportunity to get residency by investment. Non-EU nationals obtain a 10-year residence permit if they invest at least €250,000 in the Hungarian economy. The program offers three options: investing in real estate funds, purchasing residential property, and donating to a higher learning institution.

The status can be extended once for the same period. The investor’s spouse and minor children are also granted a Hungary Golden Visa.

2. Visa-free travel to the Schengen countries. Residents of Hungary visit any state of the Schengen Area without visas. They stay in each country for up to 90 days out of 180. 

Hungary’s location in Central Europe makes it a perfect hub for frequent travellers. It takes around 3 hours to drive from Budapest to Vienna, the capital of Austria, and to reach Paris or Milan by plane.

3. Prospect of obtaining permanent residency and citizenship. After three years of living in Hungary, foreigners can apply for a permanent residence permit. Eight years after holding permanent residency, they become eligible for a Hungarian passport.

4. Access to European banks. To open accounts in local and international banks, Hungarian residents typically need only a passport and a residence permit. A Hungarian bank account enables swift money transfers to other EU countries via the Single Euro Payments Area system, or SEPA.

5. Affordable cost of living. Consumer prices in Hungary are 48% lower than in Germany and 54% cheaper than in France. In Hungary, a single person, on average, spends €627 per month without rent. A family of four usually requires at least €2,192 per month. The average cost of living in Budapest is slightly higher, around 6% above the national average. 

6. Business opportunities. Hungary has been recognised as the best country for launching startups in 2024. It takes just 7 days for an entrepreneur to open a business in Hungary. The country also has a low corporate tax rate of 9%. For comparison, the business tax rate in Italy is 27.8%, while in the Netherlands it is 25.8%.

Businesses established in Hungary sell goods and services across member states without extra costs or extensive customs checks.

7. Low taxes. Hungary has one of the lowest tax rates in the EU in general. The income tax rate is 15%, which is three times lower than in Portugal, Spain, France, and Germany. Capital gains tax in Hungary has the same rate of 15%.

8. Public healthcare is available for foreign residents as they join the national social health insurance system. All treatments are generally free of charge if prescribed by a physician. 

Private healthcare is more affordable than in the USA. The average cost of a visit to a private doctor in Hungary is €67, compared to €97 in the USA. In Italy or Finland, the visit costs around €75. 

The healthcare system in Hungary is ranked 34th out of 195 countries for its quality in the Global Health Security Index.

9. Safe country to live in. Hungary was ranked 18th out of 163 countries in the Global Peace Index, 2023. The country has a low risk of mugging or natural disasters. Taxis and public transport are also claimed to be safe and reliable.

10. Stable economy. The predicted GDP growth in Hungary for 2024 is 3.1%. In comparison, the Netherlands and Finland are expected to increase their GDP by only 1%. Hungary has also managed to notably decrease the inflation level from 17% in 2023 to 4.5% in 2024.

Higher GDP growth encourages the emergence of new businesses and job opportunities. Additionally, it tends to improve the quality of life for the country’s residents.

11. Quality higher education. Higher education in Hungary follows the Bologna system, which ensures that degrees earned from Hungarian universities are recognised internationally. In the 2024 QS World University Ranking, 11 Hungarian universities are listed among the best universities in the world, including universities of Szeged, Debrecen, and Budapest.

What are the disadvantages of living in Hungary?

Low salaries. The average monthly salary in Hungary is around 495,000 HUF, or €1,259. However, employees in most EU countries earn two or three times more. For example, an average salary in Italy and Germany exceeds €3,600 per month, while in Spain and Portugal it is around €2,700.

Foreigners need a lawyer to buy property in Hungary. Only a lawyer has the right to obtain purchase permission at the Land Registry to conclude the contract. They also must accompany non-EU nationals in transacting money to the property seller and receiving a title deed.

English is not widely spoken in Hungary. Around 20% of the Hungarian population speaks English. Expats note that it is often difficult to find English-speaking professionals, especially among government officials and healthcare workers. However, this is not the case for large cities like Budapest.

Learning Hungarian may help people feel more integrated into society since it is the country’s only official language. However, Hungarian is considered to be one of the most difficult languages for an English speaker to learn due to its complex grammar and pronunciation.

Hungary limits jobs available for foreigners. The Hungarian government made a list of 300 jobs which non-EU nationals are not allowed to take. The list includes jobs like legal assistants, photographers, or vineyard workers.

Challenging climate. Hungary has snowy winters, with an average temperature of -3…7°C. On the coldest days, it can drop below -10°C. In spring and autumn, the weather is unpredictable and can change notably within several hours. Summers in Hungary are dry and warm. The average temperature is +23…28°C.

How to obtain a residence permit in Hungary by investment

According to Hungary’s new immigration law, non-EU investors are eligible for a 10-year residence permit in Hungary. The resident status may be extended for the same period. The duration of Golden Visas in most EU countries often does not exceed 5 years.

The program offers three investment options:

1. Investment in local real estate funds — €250,000 or more.
2. Purchase of residential property — €500,000 or more.
3. Charitable donation — €1,000,000 or more.

All investments, except for charitable donations, need to be maintained for at least 5 years. 

The investor’s spouse and minor children can be added to the application. The investment threshold remains the same regardless of the number of applicants.

Other types of residence permits in Hungary

Digital nomads who earn at least €3,000 per month abroad are eligible for the Hungary White Card. The residence permit is issued for one year and can be extended for one more year. Family members do not obtain the status. The White Card does not allow applying for permanent residency in Hungary.

Employees are granted a residence permit in Hungary for the duration of their work contract. The usual validity is 1 year. Highly qualified professionals can obtain an EU Blue Card, which is issued for 1—4 years. Employees may add their spouse, children, and parents to the application.

Students who are accepted to a Hungarian educational institution get a residence permit for up to 2 years. If the duration of studies exceeds 2 years, the status can be extended for another 1—2 years. A student cannot add family members to their application.

Family reunification. Hungarian citizens and residents can bring their family members to live with them. A spouse, parents, minor children, and siblings may apply for a 3-year residence permit on the grounds of family reunification. The status can be extended for another 3 years.

How to renew a residence permit in Hungary

To renew a residency card in Hungary, foreigners submit the necessary documents proving they still meet the initial conditions of their status, such as proof of enrolment for students or a work contract for employees.

To renew a Hungary Golden Visa, investors need to reinvest in the country’s economy if:

• they purchased fund certificates; in this case, they must reinvest at least €250,000;
• a foreigner sold the investment property after 5 years or owns a share worth less than €500,000.

No reinvestment is needed if investors still own property worth at least €500,000 or have initially donated €1,000,000 to an institution of higher learning.

An application must be submitted at least 30 days before the residence permit expires. It is recommended to start working on the renewal at least 60 days before the card expires to have enough time for collecting the required documents.

Renewal applications are processed online through the official website, where residents can submit their application and pay the necessary fees.

Within 15 days after submitting the applications, foreigners visit the client service of the regional directorate to provide biometric data.

Key points about Hungary residence pros and cons

1. Foreigners can obtain a Hungarian residency on several grounds: as digital nomads, employees, students. The most streamlined process is provided for obtaining a Hungary residence permit by investment.
2. Hungarian residents travel visa-free within the Schengen Area. After three years of living in the country, they become eligible for a permanent residence permit. In eight more years, residents can apply for a Hungarian passport.
3. Life in Hungary will be attractive to those who seek a country with an affordable cost of living, a stable economy, and low tax rates.
4. The main disadvantage of living in Hungary may be the strict rules regarding property purchase and employment for foreigners. New residents also need to get accustomed to Hungary’s climate and Hungarian language, which is more commonly spoken in the country than English.
5. To obtain a Hungary Golden Visa, non-EU nationals invest at least €250,000 in the country’s economy. The program provides three investment options, including property purchase and charitable donation.