The phased introduction of a new property registration procedure in Hungary

15 January 2025 is an important date for legal professionals involved in real estate law in Hungary. Theoretically, this would have been the moment when paper-based property registration would have been replaced by a drastic change to a fully digital solution. However, the software transition encountered a number of obstacles.

The government expected that all Hungarian and foreign individuals and legal entities would have digitally signed electronic deeds for real estate transactions in the new system. This would have required changing the entire IT system of the land registries to a solution to which notaries, lawyers, courts and other public bodies could connect online.

Partly because of the delay in finalizing this new system, its installation in all land offices in the country and the lack of digital signatures for a significant number of operators, only partial progress has been made so far, leaving paper-based administration for both contracting parties and legal professionals.

According to current knowledge, this transitional situation will last until the total number of applications filed in all land offices in the country after 15 January 2025 reaches 500,000

Lawyers who wished to continue to deal with real estate transactions under the new regime would have to pass a special professional examination and take out an additional liability insurance policy specifically for this business. The work of these lawyers will be significantly transformed, because their work will result in an almost immediate entry in the land register in simple cases as a result of an automatic decision in the new electronic procedure. This new solution could significantly speed up the time taken to complete real estate transactions in cases where the full purchase price is paid immediately.

Dr. György Zalavári LL.M, partner at Ecovis Zalavári Legal Hungary, points out that legal professionals are currently analysing the laws and implementing regulations related to the new system, as some of its points are not yet fully understood, and the wording of the legislator requires new solutions and interpretations in practice, both for the authorities and for market players. To this end, representatives of the land registry, the Ministry of Justice and the bar associations are in constant consultation on new issues that have arisen in practice.

A disadvantage for lawyers under the new system will be that the hitherto well-established practice of client identification and deed notarization by video conference will, as far as we know, be discontinued and there will be a return to the slower and more costly solutions of the previous, less flexible foreign notarial and diplomatic authentication.

If you are planning to invest in real estate in Hungary, our Ecovis International’s experts in Hungary will be happy to assist you in achieving your goals.