Hungary President Enacts Guest Investor Visa Legislation

[editor]

Hungary has taken a significant step towards bolstering its investment landscape with the official enactment of the Guest Investor Visa legislation, also known as "vendégbefektető vizum." The President of Hungary recently signed the decree, which was subsequently published in the official gazette, solidifying its status as law. This move marks the official reopening of Hungary's Golden Visa program, emphasizing property investments as a key avenue for foreign investors.

The journey of this immigration legislation, designated as Bill T/6097, has been a comprehensive one, involving multiple stages of review and approval within the Hungarian political landscape. Here is a timeline outlining the key milestones in the passage of this bill through parliamentary discussions and voting:

• Bill Submitted: November 14, 2023
• Voting: December 12, 2023
• Signed by National Assembly: December 15, 2023
• Signed by President: December 20, 2023
• Gazetted: December 21, 2023

Under the Guest Investor Visa regulation, foreign nationals are granted the opportunity to acquire properties in Hungary, entitling them to a 10-year residence permit based on their investment. To maintain their eligibility, investors must uphold their investment for a minimum of 5 years, with the option to renew their residence permit for another 10 years.

Investment Options for Guest Investor Visa:

1. Real Estate Investment Fund: €250,000 (with a certificate of share)
2. Luxury Residential Properties: €500,000 (with full property title)
3. Donation: €1 million contributed to a Public Fund

It's important to note that investments in bonds and bank deposits do not qualify for this program. The main applicant, as well as their immediate family members (spouse and children under the age of 18), will all be eligible for residency permits lasting a decade. Importantly, there is no mandatory requirement for the main applicant to reside in Hungary continuously.

The Office for Aliens Policing and Asylum is expected to commence accepting the first wave of applications under this program starting in July 2024. Additional guidelines and pertinent conditions will be provided by the OIF in due course. It's worth noting that applications will not be processed during the months of January and February 2024.

This newly enacted legislation signifies Hungary's commitment to attracting foreign investment through a structured and attractive visa program, providing opportunities for investors to engage with the Hungarian real estate market while enjoying the benefits of long-term residency in this Central European nation.

Pros and Cons of Hungary's Guest Investor Visa Program

Pros:

1. Residence Opportunity: The program offers foreign investors the chance to obtain a 10-year residence permit in Hungary, which can be renewed for an additional decade, without the requirement of continuous residence in the country.
2. Real Estate Investment: Investors can choose to invest in Hungary's real estate market, contributing to the nation's property sector and potentially benefiting from property value appreciation.
3. Investment Options: The program provides flexibility with various investment options, including real estate investment funds, luxury residential properties, and a donation to a public fund, catering to different financial capabilities and preferences.
4. Family Inclusion: The main applicant's immediate family members, including their spouse and children under 18, are eligible for residence permits under the same investment, fostering family unity and security.
5. Long-Term Stability: Hungary is known for its political and economic stability, making it an attractive destination for long-term residency and investment.
6. Ease of Application: The program's implementation is expected to have straightforward application procedures, making it accessible to potential investors.
7. No Minimum Residency Requirement: Unlike some residency programs, Hungary's Guest Investor Visa does not mandate a minimum period of residence in the country, offering flexibility to investors.

Cons:

1. Financial Commitment: The investment requirements, particularly for luxury residential properties and donations, can be substantial, which may limit participation to high-net-worth individuals.
2. Non-Qualifying Investments: Certain types of investments, such as bonds and bank deposits, are not eligible for this program, limiting investment choices for applicants.
3. Market Risks: Real estate investments inherently carry market risks, including property value fluctuations, which could impact the return on investment for participants.
4. Timing Constraints: The program's start date for accepting applications is scheduled for July 2024, with a temporary halt in processing during January and February 2024. Potential investors may need to plan their participation accordingly.
5. Limited Residence Flexibility: While there is no minimum continuous residence requirement in Hungary, some investors may prefer programs that offer greater flexibility in terms of residing in multiple countries.
6. Donation Requirement: The highest investment option involves a substantial donation to a public fund, which may not be desirable for all investors, particularly those seeking tangible assets in return for their investment.
7. Uncertainty: Like all visa and residency programs, Hungary's Guest Investor Visa may be subject to regulatory changes in the future, potentially affecting the terms and conditions of the program.

In summary, Hungary's Guest Investor Visa Program offers attractive prospects for foreign investors seeking long-term residence in Hungary through real estate investments. However, the financial commitment and investment options may not align with everyone's preferences or capabilities. It's essential for potential participants to carefully consider their financial goals and circumstances before applying to the program.

 

[mattm]

I've been following Hungary's visa policies for a while now, and this Guest Investor Visa is a big step forward. Investing in their real estate market seems like a decent way to secure residency, especially with Hungary's stable economy. Just wondering if anyone has already started preparing for this?

 

[adamhholmes]

It’s a smart move on Hungary's part, but I think people need to be aware of the market risks. Property values can fluctuate, especially in cities like Budapest where the market has been unpredictable at times. If you’re banking on price appreciation, tread carefully. Also, keep in mind the high donation requirement—it’s definitely not for everyone.

 

[jennifer.javier]

Does anyone know if this visa also grants access to the Schengen Zone for travel? I mean, if you get residency in Hungary, does that mean you can move freely across Europe, or are there restrictions? I’ve seen mixed information online.

 

[steven.harrington]

Does anyone know if this visa also grants access to the Schengen Zone for travel? I mean, if you get residency in Hungary, does that mean you can move freely across Europe, or are there restrictions? I’ve seen mixed information online.

Yes, Hungary is part of the Schengen Area, so obtaining residency through this visa would grant you access to travel freely within the Schengen Zone. However, the visa itself doesn’t automatically grant work rights in other Schengen countries—only in Hungary. You would need to check the work regulations in any specific country you’re interested in.

 

[petter]

While it's certainly intriguing from an investment standpoint, one must deliberate the idiosyncratic legalities intertwined with residency acquisition in Hungary. The Hungarian real estate market, albeit stable in certain sectors, can exhibit volatility, particularly with fluctuating economic factors. Ergo, diligence and a well-informed strategy are imperative for potential investors.

 

[koechamos]

Wow, this seems like a great opportunity, especially for those who want a long-term residence without actually living there full-time! Anyone else thinking about taking the real estate fund option? Seems like a less risky route than the luxury properties!

 

[mike1985]

I think the donation requirement is a bit too steep for most people, especially since you don’t get anything tangible in return. Real estate sounds better, but the minimum investment is still pretty high. I’d like to see a broader range of options, like smaller investments or even bonds being allowed. Would make it more accessible, in my opinion.

 

[daveyp]

The bond and bank deposit exclusion seems intentional to maintain capital flow into sectors that Hungary prioritizes. They’re clearly focusing on real estate to boost property markets. The €250,000 minimum for real estate investment funds is likely structured to attract serious investors, ensuring high liquidity for these funds. But it does limit flexibility for those who prefer low-risk financial instruments.

 

[nickdev]

If anyone’s planning to apply in July, do you know how long the approval process is expected to take? I’m trying to figure out if this would be a good option for me, but if the timeline drags out too much, it might not fit with my plans.

 

[cmarchan]

i thnk OIF said somthin bout july strt, bt no process durin jan n feb...so maybe appvl will tak months!!! keep an eye on offcial sites...