Are those who use the government’s latest “wonder weapon” really doing well?

According to the government’s proposal In 2025, voluntary pension fund savings can be withdrawn tax-free for housing purposes.

For now, there are estimates of how much of the HUF 2,142 billion pension fund holdings could end up on the real estate market in this way, but it is already clear that it is not so easy to simply “hack” these investments: several pension fund portfolios achieved exceptionally high, double-digit returns of up to 20 percent from the beginning of the year to mid-October.

Risky portfolios generate good returns

The risk-taking portfolio of Allianz Hungária achieved a return of around 20 percent this year, which is barely behind the BUX index, which is up by nearly 22 percent, or the main American S&P 500 index, which is up by 23 percent.

According to the regulations, the proportion of equity investments in this portfolio can reach 100 percent, and since the stock markets perform well globally, it cannot be ruled out that the outstanding return was achieved in this way. By the way, Allianz recommends taking the risk for those who have more than 20 years left until retirement.

Close behind is the Alfa Pension Fund, where 18.5 percent more there is the Megatrend portfolio this year. The share of stocks is 70 percent, and the investment policy is special in that it tries to capture long-term trends and processes affecting the entire world.

These trends can be demographic changes (aging society, developing markets), scarce resources, energy efficiency, urbanization, or even technological innovations and innovation.

The dynamic portfolio of OTP Önkéntes Nyugdíjpénztár was placed on the third step of the podium with a 17.7 percent exchange rate gain this year.

In ten years, the real estate market performed slightly better

By the way, if someone is thinking about where their money will generate a higher return: in pension fund accounts investing in shares, or in the real estate market, it is worth comparing the longer-term trends as well.

The riskiest self-care portfolio of the aforementioned Allianz pension fund increased by more than 182 percent from the beginning of 2015, bringing an annual average return of over 18.6 percent. THE KSH the combined housing market price index, however, shows a slightly higher increase, according to which, in less than a month and a half, over 10 years, investments in the Hungarian real estate market have brought an annual return of 19.5 percent.

However, the comparison is complicated by several factors:

• the increase in housing prices shows a large deviation according to the location within the country and settlements;
• the investment policies of pension funds may differ from each other;
• for voluntary pension fund investments, a maximum of HUF 150,000 per year can be claimed.