“Limitless
potential & unfettered capitalism”
the new
Budapest, a land of opportunity
by Ken Layne
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Travis
Smith, a Californian, until very recently had a good position with the
Los Angeles Times, running its Web-site newsroom. He gave all that up and
now works for an Internet company run by Hungarians and Americans - in
Budapest.
| In the past
10 years, central Europe has metamorphosed from a travel frontier and Cold
War relic to a thrilling part of plain old Europe. Hungary, like the Czech
Republic and Poland, is a member of NATO and by 2004 is expected to be
part of the European Union. The rusty old infrastructure is being modernized
at a pace unheard of farther west. A telecommunications zealot in Budapest
once told me this work was easy, because the phone system was 40 years
out of date, so rather than slowly improve the existing wires and equipment,
everything was replaced with the newest technology.
Part of
commercial Europe
While there
have been cries of foul play over Hungary's selling of state owned utilities
and enterprises, the business environment is far from the wholesale thievery
of Russia's corrupt steps to capitalism. And like its central European
neighbors to the north, Hungary has always considered itself part of commercial
Europe - even if there was that little Soviet disruption.
Travis Smith's
company is one of nearly 500 American owned firms in Hungary, the United
States Information Service reports. Most of those are in Budapest, and
they include everything from gigantic corporations to start-up technology
businesses.
Budapest-Invest,
which acts as a consultant for foreigners buying property in Hungary, has
this to say about setting up shop there: “If you decide to run a business
in Hungary, you will find it a real land of opportunity with almost limitless
potential. It is a freewheeling environment that places few obstacles in
your path. You can set up with almost nothing and hire help for a few hundred
dollars a month. Here the opportunity and unfettered capitalism of the
new East meets the relative stability of the West, creating the ideal business
environment.” |
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Safe, cheap,
and charming
But few expatriates
choose Budapest just for business. “The European lifestyle is immensely
appealing to me,” says Travis. “I walk home from the office at 2 in the
morning, with little fear of violent crime. I don't have a car, yet for
$3, and a 30-minute wait, I can take a trip to the Hungarian mountains
on the excellent bus network and hike all weekend. The cultural life is
excellent. The pace of life outside the Internet field is also wonderful.”
James O’Leary,
another American journalist, who moved to Budapest six years ago and cant
seem to leave, has a more perverse and no less accurate set of reasons.
O’Leary rattles off a list including cheap food, gorgeous Hungarian girls
in miniskirts, a long and twisted city history, only a few TV channels
in English, and streets lined with stunning, turn-of-the-century architecture.
On the downside,
O’Leary explains that, even after six years, he can still only barely understand
his Hungarian friends until they switch to English.
Conversing
with the locals?
The bizarre
language is a common problem - or blessing, depending on your personality;
one of my favorite things about living in Budapest was being blissfully
unmolested by local jabbering. Things I could never enjoy in America, such
as sitting for hours in a crowded café with a book, are perfectly
acceptable when the surrounding conversation consists of rapid, incomprehensible
Hungarian.
Some people
do take the plunge and attempt to truly learn Hungarian. Emmanuelle Richard,
a radio reporter from the French city of Lyon who speaks good Hungarian
despite her claims to the contrary, had Magyar pen pals as a kid and was
more responsible than most expatriates. “You need to study before you go,
because there's no way you'll stay in and study at home once you arrive.
There's just too much to do in this great city,” says Richard, who lived
in Budapest for three years. “I was lucky from the beginning, because I
had studied Hungarian with a book and tapes and already knew people there.
I don't ever remember feeling totally lost, except maybe when dealing with
landlords.”
Renting
under the table
Hungarian landlords
are known and feared for their occasional rants. Richard was once chewed
out for having long hair - the landlord was convinced this terrible hair
caused the clog in the bathtub drain. The most likely culprit was not French
hair but poorly maintained plumbing in an old building.
But considering
that many Budapest landlords were dealing with their first tenants in the
1990s, after spending their life savings to buy an apartment as the Communist
era ended in 1989, foreigners have fairly good luck with rentals. And if
a landlord is nervous about renting to expatriates, it's not without warrant.
The cheapest
flats in Budapest are rented for cash only and without the proper paperwork.
It saves the owner tax money. Richard says that since roughly 80 percent
of these landlords don't tell the tax authorities about such transactions,
the owner is responsible for everything - including the phone bill.
“When a dispute
occurs, or a misunderstanding, foreigners just call all their friends back
home for a couple of hours and pack up, leaving the landlord with a huge
phone bill,” says Richard. Not very nice, but unofficial tenants have little
recourse if they're suddenly kicked out and denied a refund on their rent
or deposit. Of course, one should expect a few glitches when a gorgeous
old apartment in a fine neighborhood can be rented for $250 a month, which
is average.
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Pay double
for a formal lease
Those wanting
a more stable existence are advised to use one of the new rental agencies
littering the city. Pick up the Budapest Sun or the Budapest Business Journal
for listings, but be prepared to pay at least double to get a formal lease.
Thus far, Budapest
has been a destination for people in their 20s and early 30s, and the cheerful
drunken life is suited to informal living arrangements. But as some of
these people age a few years - as did O’Leary, who says he is “forever
ruined” for a 9-to-5 corporate American job - the question eventually arises:
“Could I buy a flat here and stay?”
Elegant
living for less than $30,000
The answer
is yes, at least for now when prices are still ridiculously low. Nick Drake
of Budapest-Invest ran off a few current listings for me: On Andrassy Ut,
among the most beautiful and prestigious boulevards in Budapest, there's
a big two bedroom flat with living room selling for $29,000. A comparable
apartment in Paris could cost 10 times that amount. He told me about several
others in the $30,000 range, from a huge top floor flat with a balcony
in the 9th district for $29,000 to a Kiraly Utca apartment in the 8th district
for $30,000.
Why so cheap?
Because high interest rates (15 percent on the average) and a slowly developing
mortgage/private-banking industry have kept many Hungarians out of the
market. This is changing, but today it's possible to get a fine European
city home for the price of a standard new car. (Buying property requires
some fairly simple paperwork, although many foreign buyers form a local
company for such purposes.)
The gems are
well maintained flats in older, well maintained buildings. Expect to pay
around $40 a month for co-op dues (covering garbage service, upkeep of
the facade, and sometimes heat and water) and avoid buildings with obvious
long term deterioration. |
Turn-of-the-century
grandeur
Some enterprising
expatriates buy a couple of adjoining flats and create grand city homes
with all the modern gadgets Westerners seem to enjoy. But there's something
to be said for just having such a home in its original condition - incredibly
high ceilings, fine wood floors, oversized windows, sturdy construction,
and thick walls that hide the noise of neighbors are just a few benefits
of Budapest's turn-of-the-century apartment houses.
Foreigners,
whether students, business people, or retirees are officially welcome in
Hungary. There is still some sloppy Communist era bureaucracy, but it's
less rigid than in many European states and it's easy to avoid certain
hassles. For instance, expatriates I know skirt the need for a residency
visa by visiting Vienna (a pleasant train ride away) every three months
and getting their passports stamped anew.
Budapest
resources on-line
The three major
English language newspapers; Budapest Week, the Budapest Sun, and the Budapest
Business Journal, all have fine, regularly updated Web sites with
news and city information. If you're seriously considering Budapest as
a place to live, it's worth reading all three. (The classified ad sections
are the best place to find reasonably priced apartments in the city, but
you'll need the print editions to see the ads.)
• Budapest
Week, Web site: http://www.budapestweek.com/,
is the oldest expatriate paper in town. It has struggled to stay in business
as the city has changed from a backpacker hangout to a corporate destination.
• The Budapest
Sun, Web site: http://www.budapestsun.com/,
started publishing in 1993. The weekly general news publication can be
found all over town.
• The Budapest
Business Journal, Web site: http://www.bbj.hu/,
is an excellent weekly that has way more than just commerce news. With
a first rate staff of Hungarian, American, and British reporters, the paper
is tough, smart, and well edited. Don't miss Zoltan Scrivener’s “After
Hours” column - over the years, he has drag raced through Hungary, toured
strange breweries, and attended pig slaughters in the countryside. Registration
is free, but you need to subscribe to the paper to get access to online
archives.
More resources
• One of the
best new Budapest sites deciphers the mysterious wines of Hungary, saving
much experimentation can be found at http://www.borbarat.com/
• More business
help can be found at the American Chamber of Commerce, Web site: http://www.amcham.hu/
• Investment
king and Hungarian-American George Soros runs the Open Society Institute
and Central European University, both based in Budapest. The OSI maintains
a huge database of background material; reports, news coverage, etc., that
is of great value to anyone trying to understand Hungary's economic and
political changes; Web site: http://www.osi.hu/
For information
on buying real estate in Hungary, visit these sites:
• Virtual
Hungary, Web site: http://www.virtualhungary.com/
• Budapest
Invest, Web site: http://www.budapest-invest.com/
Finally, for
the somber Washington view of Hungary, the latest CIA report can be found
at: http://www.odci.gov/
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Article
by Ken Layne |
