Legal background, consequences, and new opportunities in long-term rentals
Our three-part article series, we explore the impact of the so-called “Airbnb Decree” in Terézváros (District VI). In the first part, we present the background and reasons behind the regulation, provide an interpretation of the decree, and evaluate the available options for property owners in District VI.
We refer to the 26/2024 (October 31) Terézváros Municipal Decree.
What exactly happened with apartment rentals in Terézváros?
On October 31, 2024, Terézváros (Budapest District VI) effectively ended short-term apartment rentals. The local government introduced a new regulation, commonly known as the “Airbnb Decree,” which limits private and other accommodation services to 0 days. The adoption of this decree was preceded by a local referendum in which the residents voted in favor of a complete ban.
According to Decree No. 26/2024 (October 31):
“The number of days available for accommodation services at private and other lodging facilities within a calendar year is: 0.”
This provision not only restricts but completely eliminates the use of apartments for tourism purposes in Terézváros.
The enforcement of the decree is accompanied by sanctions: administrative fines and even temporary closures may be imposed on those who violate the regulations. The decree will only come into effect on January 1, 2026.
Why did the local government decide to ban short-term apartment rentals?
A growing trend has emerged in several major European cities to address housing issues by shifting the market towards long-term apartment rentals. Some cities, like Barcelona (and Budapest’s District VI), have opted for a complete ban, while others, such as Amsterdam, have chosen to tighten existing regulations. The general goal behind these decisions is to support permanent residents and property owners by stabilizing prices and ensuring a quieter, more livable environment.
Prioritizing housing-focused apartment rentals
Terézváros has approximately 29,000 apartments, of which around 2,700 currently operate as short-term accommodations. This accounts for nearly 10% of the district’s housing stock and will also have a noticeable impact on the entire Budapest real estate market.
The return of these apartments to the long-term rental market is expected to lead to a decrease in rental prices and property values, even within a foreseeable timeframe.
Protecting the residential environment
Tourist accommodation operations have caused significant headaches for many residents. The constant flow of tourists, noisy parties, and littering have made daily life far from ideal for the people of Terézváros. The shift towards long-term rentals will likely lead to positive changes in the lives of those living there.
Simplifying tax inspections
Short-term rentals (even for just 1-2 days) are much harder to track and monitor compared to long-term leased apartments.
Message to the commonwealth
Beyond practical implications, the decree also carries a social and economic message: Terézváros prioritizes long-term, stable housing over short-term profit-making.
What exactly does the “Airbnb Decree” contain?
Airbnb decree (the full text can be read here) consists of three main sections. The interpretative provisions define (or rather reference) the concepts of private and other accommodations. General provisions detail the ban and the associated sanctions, and the final provisions specify the date of enforcement.
Who does the regulation apply to?
The decree is overall strict and aims to leave no loopholes for potential evaders. Thus, according to the decree, the regulation applies to:
- All private individuals and businesses in District VI who rent out property short-term outside of commercial frameworks;
- To apartments that have been registered or used as private or other accommodations;
In summary: Airbnb, Booking.com, or any form of short-term rental is now illegal and subject to fines.
Of course, commercial accommodations (hotels, hostels) can continue to operate without interruption in District VI, but obtaining permits and running these establishments is much more complicated and expensive than managing previous private accommodations.
What do the sanctions include?
- For natural persons and sole proprietors, the fine can amount up to 200,000 HUF;
- For legal entities (e.g. companies), up to 2,000,000 HUF;
- In addition, a 45-day temporary closure of the property may be ordered;
- The application of sanctions is determined by the notary without discretion.
In practice, this means: anyone renting out their apartment for tourism purposes takes on significant financial and operational risks.
What will happen to Airbnb and Booking apartments?
Short-term rentals will cease in District VI
The zero-day rule leaves no room for maneuver. In Terézváros, short-term rental can no longer be legally operated. Apartments reserved for this purpose thus lose their former function, and owners are forced to seek other options, which in this case means either long-term rental or sale.
The boom of long-term rentals
Since all other forms are prohibited, the optimal legally compliant operating model is a minimum one-year or indefinite-term lease agreement. Transitioning to the long-term market, however, requires professional preparation and strategy. Here, a professional property management team can assist by taking daily burdens off the owner’s shoulders.
Long-term rental – the only option for property owners
Under the new regulation, only well-managed, legally compliant long-term rental is viable.
What is needed for long-term apartment rental?
- Well-prepared lease agreement
The basis of long-term rental is a clear contract that protects the interests of both parties. This includes the rental period, payment, termination conditions, and maintenance responsibilities.
- Selecting a reliable tenant
The key to successful rental is finding a stable, solvent tenant. It is advisable to use reference checks, income verification, and personal interviews.
- Administrative and legal compliance
Compliance with the regulation is essential. This includes fulfilling tax obligations, registrations, and, if necessary, official approval of the rental.
- Active property and apartment management
Even during long-term rental, continuous maintenance, tenant communication, and monitoring of the apartment’s condition are necessary to ensure the apartment’s value is preserved.
- Quick market response
The rental market is volatile. The owner or their agent must respond quickly to price changes, supply-demand shifts, or tenant issues to maintain competitiveness.
If you currently operate an Airbnb, now is the time to switch to long-term rental – professionally and legally.
Comprehensive property management with the Homever team
At Homever, we specialize specifically in long-term property management and pay special attention to the changes in District VI.
Homever provides property management covering all areas – all for an unbeatable, gross 8% management fee:
- Tenant screening, communication, contract signing,
- Price positioning, market strategy,
- Fault repair, maintenance, utility management,
- Financial transparency, monthly accounting,
- Investment advice.
Your apartment will continue to operate securely and efficiently with us – legally and profitably.
Would you like to find out why it is worth entrusting property management to professionals? Our article reveals it!
Contact us today and let us make renting out your apartment simple and profitable!
Now is the time to act – the rental market is continuously changing
The regulation has already triggered a reshuffle: more and more apartments are entering the long-term market. Those who act quickly gain an advantage: find better tenants, achieve more stable income, and avoid legal risks.
A new era has begun in District VI – and the winners will be those who adapt in time.
What can the rental market learn from this regulation?
- Local regulations can radically reposition real estate utilization opportunities;
- Housing becomes the main priority instead of tourism;
- Investors need strategic redesign;
- The quality of property management is key to returns;
- Those who try to manage the new situation alone may easily fall behind competitively.
Next part: How will this affect the entire Budapest real estate market?
In the next part of the series, we examine the consequences of the District VI regulation for other districts, owners, tenants, and the overall Budapest real estate market.
