Housing Commodification and Increasing Potential Ground Rents in Post‐Socialist Budapest

Abstract

Abstract In post‐socialist Budapest, gentrification has remained modest for decades after the regime change (1989) due to politically controlled economic relations besides marketisation. Political control was transformed but maintained after 2010 in the illiberal Orbán regime. Populist housing privatisation for tenants, insufficient regulation of rental housing, mortgage policy and urban rehabilitations with systemic corruption caused moderate level of housing market commodification. However, gentrification accelerated from 2014. Among other factors, the restriction of mortgage lending and the unplanned expansion of tourism increased the commodification of real estate market. Similar contextual issues were mentioned in the gentrification literature before; however, they remained external modifying effects of the assumed nomothetic political economic mechanisms behind rent gaps under neoliberal governance assumed everywhere. We suggest connecting institutional, social and political factors with dynamics of land rent through the concept of commodification and its effects on potential ground rent to include them within the mechanisms of gentrification.