Across the European Union, Hungary is experiencing the steepest decline in hospitality venues. Between 2021 and 2024, the sector contracted by 6%, even as 22 member states reported growth. Over the past decade, the picture is grimmer still: nearly one-fifth of hospitality businesses have vanished.
A recent study (source in Hungarian) attributes the accelerating downturn to the proliferation of low-quality lángos and goulash outlets targeting foreign tourists with high-margin, inexpensive fare. These establishments, which primarily draw low-spending visitors such as stag parties, are crowding out quality restaurants and damaging the country’s culinary reputation.
“I dare say that we are the only country in the world where you can get lángos with Greek salad, lángos with beef stew, and I could go on. There is nothing wrong with a simple dish being good. That is not a problem at all. The problem is when we try to serve this simple dish in a way that means it is no longer that dish, and on top of that we try to attach a gastronomic culture to it,” said Áron Reményik, author of the study and communications expert at Raconteur Agency.
Hungary becoming expensive
Although tourism peaked in 2025, it failed to provide a meaningful lift to the hospitality sector. Conditions have since worsened: a post-election strengthening of the forint has made Budapest 12–14% more expensive for euro-paying tourists, while national branding campaigns have been suspended. Consequently, foreign tourist arrivals in August dropped 14% year-on-year.
The result, according to Zoltán Kőrössy, founder of Eventrend Group—which operates 35 hospitality venues—is a severe competitiveness crisis for Hungarian restaurants.
“We have reached European price levels in almost every cost category. We pay almost the same for energy and wages. Today, it is cheaper to employ hospitality workers in southern Italy or southern Spain than in Hungary. In Austria, it may still be a little more expensive, but overall, there is not much difference. Raw material prices are almost at the same level,” explained Zoltán Kőrössy to Euronews.
Few Hungarians can afford to eat out regularly
While costs—and consequently prices—have reached Western European levels, revenues have not kept pace. Austria, for instance, has a comparable number of hospitality venues but generates double the sector turnover. This disparity reflects not only tourism but also domestic spending power.
Economist Zoltán Pogátsa recently noted (source in Hungarian) that two-thirds of Hungarian households earn less than the EU’s lower-middle-class threshold. Without a broad, solvent middle class, restaurants dependent on repeat local custom cannot survive.
Unsurprisingly, the number of hospitality venues in the capital dipped below 8,000 for the first time on record in 2024, declining further to 7,778 by the end of 2025, according to the Central Statistical Office.
Reményik suggests extending the certification and inspection system for Hungarikums and authentic Hungarian cuisine to the street-food segment. Limiting the number of purely tourist-oriented street-food outlets in high-traffic zones would also help. While such measures would not boost domestic disposable income, the resulting easing of rental pressure could offer struggling quality restaurants a better chance of survival.