The construction sector is ready to jump on the market's recovery

ÉVOSZ welcomed the government's proposed Economic Action Plan by explaining the measures in detail and giving its views. It was stressed that the measures identified so far could provide new housing opportunities for a wide section of society by increasing the activity of new housing construction and renovation.

"We consider it important that the programme points are put into practice as soon as possible, so that the construction industry can be on a growth path in 2025."

- the statement said. "In order for energy renovations to take off dynamically, it is essential that several sources of support, available from January, can be used in combination with each other."

No more profiteers working on state-subsidised jobs

In relation to the programmes, ÉVOSZ also makes a request: registration of contractors and products and simplified environmental certification should be a mandatory element, which - after initial difficulties - is now working well for the New Home Renovation Programme. "We must not have a situation in which unscrupulous people are working on state-subsidised works with shoddy building materials", they stressed.

It was also reported that the construction industry says that there are currently reserves in the system. Both on the product manufacturing side and on the construction capacity side, the industry is capable of higher output. "The industry has all the potential to build 25,000 new homes per year, which is the target figure, and we consider this to be a good target for the year," the statement said.

They went through the measures announced in detail and made the following proposals.

Launch of rural home renovation programme

We welcome the relaunch of the previously popular small town version of the scheme. In our view:

• Given the size limitation of the settlement, the programme could generate additional investment of a meaningful size, i.e. at least HUF 100 billion, if the support could also be used by rural families without children, i.e. those who were excluded from the first round of the programme. Building renovation is also an important social and economic objective for the elderly and childless.
• It would also be important to support the process of energy retrofitting of rural buildings, so that those who did not use the scheme for this purpose in the first round could reapply for the current scheme specifically for such renovations that reduce energy consumption and carbon emissions.
• As regards financing, it should be noted that compulsory borrowing would significantly reduce the number of beneficiaries, and it is therefore proposed that borrowing should be an option, but that it should be possible to participate in the scheme without it.
• It would be very helpful if the accounting of the programme could be done in the same way as the previous €3+3 million programme, and the administration and disbursement could be done quickly and easily through government offices and the Treasury.

Review of the system of rents and contractual conditions

We do not consider the introduction of an artificial rent ceiling to be a viable solution. The deterioration of returns would reduce the available supply, discourage investment/investment by property developers and drive the market towards the black economy. Instead, the state could introduce a national registration system to promote transparency, with standard contracts to ensure predictability and even tax incentives. The point on tax relief for housing benefit provided by the employer also points in this direction. It may also be worth reviewing the law on housing tenancies, as at present landlords' risks are built into rents as a surcharge. A sensible regulation could certainly reduce this surcharge.

Developing a housing programme for young people

The launch of the Youth Housing Programme is a missing initiative. We propose the development of a "tenant-owner" model. The idea is that a scheme that starts as a rental will at some point during the term of the lease become a home ownership scheme, thus creating an affordable home ownership alternative for young people. The effectiveness of the scheme would be enhanced if the state, together with municipalities and market actors, would act in a co-ordinated and cooperative way to implement the projects. We consider the development of a preferential scheme for low-interest green loans for young people's first home purchase to be a missing initiative.

Use of SZÉP card benefits for housing renovation

A lot of little goes a long way, and for a small renovation job, it can be enough. The favourable tax burden of the SZÉP card would encourage employers to offer higher benefits and this would increase the value of the programme point. Extending the use of the tax credit for housing subsidies from employers would also encourage renovation. ÉVOSZ proposes that money already on the SZÉP-Card that has not been used for at least 1 year could be used for energy renovation works.

Use of voluntary pension savings for housing purposes

It can be useful in certain life situations, so the possibility of home use is seen as a positive.

The planned housing measures, even in combination, could address the housing crisis across a wide range of people and, if the proposed changes are taken into account, could already contribute significantly to economic growth next year, ÉVOSZ concluded.