Hungary’s restaurant sector is under growing pressure as operating costs approach Western European levels while revenues remain much lower. A new study says the country has experienced one of the sharpest declines in hospitality businesses in the European Union, with restaurants squeezed by weaker tourism, limited household spending and intense competition from low-cost tourist outlets.
The situation highlights a wider challenge for European hospitality businesses: matching European prices is not enough when customers’ incomes and spending power do not keep pace.
Hungary records one of the EU’s steepest hospitality declines
Between 2021 and 2024, the number of hospitality venues in Hungary fell by 6%, according to the study cited in the report. During the same period, 22 EU member states recorded growth in the number of venues.
The longer-term trend is more severe. Over the past decade, 18.5% of Hungary’s hospitality businesses have disappeared, placing the sector under sustained structural pressure rather than facing only a temporary downturn.
Budapest has also seen a significant reduction in food and drink businesses. Hungary’s Central Statistical Office recorded 7,778 hospitality venues in the capital at the end of 2025, after the total fell below 8,000 for the first time in 2024.
Tourist-focused street food intensifies competition
The study identifies the growth of inexpensive, tourist-oriented outlets as one factor affecting higher-quality restaurants. Lángos and goulash bars operating in busy visitor areas can attract customers with simple menus and high margins, while established restaurants face higher staffing, energy and ingredient costs.
Áron Reményik, the study’s author and a communications expert at Raconteur Agency, argued that traditional dishes can work well when prepared simply and carefully. He criticised attempts to transform basic street food into heavily modified products while presenting them as part of Hungary’s wider gastronomic culture.
The concern is not that street food exists, but that a concentration of low-cost tourist businesses may reduce variety and make it harder for restaurants serving authentic or more ambitious cuisine to survive in the most commercially important areas.
Budapest becomes more expensive for euro-based visitors
Hungary’s hospitality problems have also been affected by changing tourism conditions. Although tourism reached a high point in 2025, the increase did not provide a sufficient boost to the restaurant sector.
The strengthening of the Hungarian forint reportedly made Budapest 12–14% more expensive for visitors paying in euros after the election. In August, foreign tourist arrivals were 14% lower than in the same month a year earlier.
That matters because restaurants in central Budapest are heavily dependent on international visitors. A fall in visitor numbers can quickly affect sales, particularly for businesses with high rents and staffing costs.
Costs approach European levels while revenues lag behind
Zoltán Kőrössy, founder of Eventrend Group, which operates 35 hospitality venues, said Hungarian businesses now face costs comparable with those in other European markets.
Energy, wages and raw materials are reportedly close to Western European levels. Kőrössy said employing hospitality workers could be cheaper in southern Italy or southern Spain than in Hungary, while Austria remains only slightly more expensive in some respects.
For restaurant owners, this creates a difficult imbalance:
- Operating expenses are rising towards European levels.
- Menu prices cannot increase indefinitely without reducing demand.
- Tourist numbers are becoming less reliable.
- Domestic customers have limited disposable income for regular dining out.
The result is a market in which restaurants may need to charge European prices without having access to European levels of turnover.
Why domestic spending matters
Tourism is only one part of the hospitality economy. Restaurants also depend on local customers who return regularly throughout the year.
The report cites economist Zoltán Pogátsa, who said that two-thirds of Hungarian society live on less money than the EU’s lower middle class. A relatively small solvent middle class limits the number of people able to eat out frequently, especially as household budgets are affected by food, housing, energy and transport costs.
Austria illustrates the difference in spending power. The two countries have a similar number of hospitality venues, but Austria’s sector generates twice Hungary’s turnover, according to the report. That comparison suggests that the key issue is not simply the number of restaurants, but the amount customers can spend and how often they return.
Possible responses for Hungary’s hospitality sector
Reményik suggested extending certification and inspection arrangements for Hungarikums and authentic Hungarian cuisine to street-food businesses. A clearer system could help customers distinguish between traditional food prepared to a recognised standard and products designed mainly for tourist demand.
Another proposal is to limit the number of purely tourist-focused street-food outlets in the busiest visitor zones. Supporters argue that less competition in these areas could reduce rents and create more space for quality restaurants.
Such measures would not resolve the deeper problem of household purchasing power. They could, however, address market concentration and help protect culinary businesses that depend on local customers as well as visitors.
What the figures mean for Hungary and Europe
Hungary’s restaurant crisis reflects several pressures affecting hospitality across Europe: high labour and energy costs, changing travel patterns, currency movements and weaker consumer spending. However, Hungary’s situation is especially difficult because domestic revenues are not keeping pace with the cost base.
For policymakers, the challenge is to support a hospitality sector that contributes to tourism, employment and national identity without allowing busy tourist districts to become dominated by businesses that offer limited value to residents or the country’s wider food culture.
The immediate priority for restaurant operators is survival. Longer term, the sector’s recovery will depend on stronger household purchasing power, sustainable tourism and a healthier balance between affordable street food and full-service restaurants.
Conclusion
Hungary’s restaurant sector is facing a structural cost crisis: prices and expenses are approaching European levels, but tourism and domestic spending are not generating comparable revenues. The decline in hospitality venues shows that the pressure is already reshaping the market. Any lasting recovery will require more than attracting visitors; it will also depend on rebuilding local purchasing power and protecting a diverse, quality-focused food industry.
