Renovation prospects did not worsen

According to the survey from May 2020 conducted by GKI and Masterplast, the renovation and modernization plans of the residents in the period concerned changed within the margin of errors compared the results of the previous quarter. This is considered a favorable update regarding the destructive effects of coronavirus. In the upcoming year, approximately 12% of the Hungarian properties are planned to be renovated or modernized. These tasks are financed mainly by own resources, while savings in building societies and state aids also play a dominant role.

The residents’ plans for renovating and modernizing their household in the next year, 2007-2020 (one thousand households)

Source: GKI surveys

GKI conducts a survey in every third month in order to obtain a better view on the residents’ renovation and modernization objectives. Masterplast Nyrt has been supporting the survey since January 2020. In the representative survey, 1000 people were asked based on their gender, age, residence and education.

 The expectations of renovation and modernization objectives for the first quarter of 2020 (relevant for the next year) corresponds to the results from the previous quarter – the change is within the margin of error. Stagnation is experienced on a yearly basis. In spite of the negative effects of COVID19, the plans of the residents to renovate or modernize their household remained within margin experienced in the past 2 years. In the upcoming year, 12% of the Hungarian households aim to spend larger sum on their house (certainly or probably). Provided these plans could been carried out, approximately 450 thousand homes would be renovated. Almost 14% of the detached houses (i.e. every seventh house) might be involved in the modernization or renovation, while this ratio concerning the condominiums approaches only 10%. 11 percent of the households in Budapest, 9 percent in the county seats, 14 percent in other cities and 12 percent in settlements plan some reconstructions.

Resources of the funds to pay the renovation and modernization (frequency, percentage):

□  Own saving: 71,8
□  Saving in building societies: 23,7
□  Bank loan:  19,8
□  State aid: 14,1
□  Loan granted by a relative or friend: 5,6
□  Loan granted by a building society: 3,4
□  Loan granted by the employer: 2,8
□  Other resources: 2,1

Nearly two thirds of those planning to renovate would use their own savings as well. (The households do not plan to use their own resources would cover their cost mostly by bank loans, slightly from their own building society resources and state aids). Almost every fourth household planning to renovate would use their building society resources as well, therefore, this saving opportunity plays a crucial role in the maintenance of the housing wealth. In the light of this, it is particularly unusual that the government has terminated the promotion this form of saving. Basically, every fifth respondent indicated to take out or planning to take out bank loans.State aids are somehow involved in every seventh renovation. Nearly twice as many residents living in detached house would take out state aids than those living in condominiums. Only every twentieth household is thinking of borrowing the missing amount from a relative or friend. Mainly people under 30 aim to go ahead with this financing arrangement. The role of loans granted by saving banks or employers are marginal concerning the renovations.