AHA Budapest - Urban Diary No.1

As Eszter Somogyi highlighted in an interview with Népszava, the availability of affordable homes has plummeted, creating a situation where large segments of the population—especially the lower-income groups—are simply priced out of decent living conditions.

The private rental market in Hungary faces significant challenges. It lacks regulation and offers limited protections for tenants, leading to unstable and costly living conditions. Although this sector has the potential to ease the pressure on public housing, soaring rents and rising utility expenses are making housing less affordable. In the capital, housing costs are especially high compared to average wages, leaving many people unable to find a decent home.

AHA Budapest comes to address these issues through an innovative and multi-faceted approach  towards affordable housing. AHA Budapest (Affordable Housing for All) is piloting a holistic, inclusive, and sustainable housing model, with a key focus on generating new affordable housing options by repurposing underutilised buildings. The initiative is developing an integrated service model that includes:

• the scalable conversion of disused, non-residential public buildings into energy-efficient social housing;
• the expansion of the social housing stock through flexible and affordable solutions; and
• preventive social and energy-related interventions aimed at improving housing affordability. At the heart of the project is a unique Early Warning System that helps prevent housing instability before it escalates.

PARTNERS:

Municipality of Budapest (consortium leader)

Burst Group

MEHI – Hungarian Energy Efficiency Institute

KÉK – Contemporary Architecture Center

NART Architects

Popcode Developments Ltd.

ULE – From Street to Home! Association

Budapest Brand Llc.

Metropolitan Research Institute Ltd.

AHA Budapest key objectives 

1.Expand Social Housing Options

• Conversion of Public Buildings: Transforming underused public assets into affordable housing. A key example is the development of the Demo Hub—a new residential building that will provide quality, energy-efficient homes for vulnerable families.
• Innovative and Flexible Housing Solutions: Engaging with the private housing market to explore alternative models. This includes incorporating new types of property owners and piloting innovative schemes to diversify and expand the city's social housing services.

2. Improve Housing Energy Efficiency

• Energy-Efficient Renovation:
  The newly developed Demo Hub will not only offer affordable housing but also serve as a model for energy-efficient residential buildings. Additionally, selected privately owned dwellings will be upgraded to improve their energy performance by at least one certificate category.
• Mentoring and Knowledge Sharing:
  Establish a mentoring network to promote energy efficiency interventions in residential buildings, ensuring that energy-poor households have broad access to practical knowledge and guidance.
• Exploring Financial Mechanisms:
  Identify and test flexible financial instruments, including renewable energy solutions and non-repayable subsidies, to help reduce energy poverty and promote sustainable housing upgrades.

3. Destigmatising and Developing MUA’s Social Housing System

• Tenant Participation and Community Building:
  Engage tenants in participatory processes and housing maintenance activities to foster a sense of ownership, belonging, and connection to their homes and communities.
• Housing office: where professionals will help those affected by the housing crisis and provide a menu of options
• Early Warning System & Supportive Interventions:
  Implement and operate an Early Warning System (EWS) to identify at-risk households and deliver timely, tailored interventions aimed at improving self-sufficiency among vulnerable tenants and homeowners.
• Public–Private Collaboration:
  Develop collaborative schemes with private actors—including investors, real estate agents, and energy service companies (ESCOs)—to scale flexible social housing models and enhance both the financial and social sustainability of the sector.

AHA BUDAPEST Leadership & Partners 

The AHA Budapest project, initiated by the Municipality of Budapest (MUA), is built on a long-term Quadruple Helix collaboration that brings together urbanist and professional organizations, NGOs higher education institutions and private sector actors. The project is led by the City of Budapest in close partnership with eight implementation partners. AHA Budapest benefits from strong backing, including broad support at the highest political level.

MUA:  Municipality of Budapest Mayor's Office, leader of the Project Management Working Group (WP2) and involves the relevant departments Public Procurement and Project Management Department, Social Policy Department (including Housing sub-department), Deputy Mayor General’s Office, Mayor’s Cabinet

Public Engagement Department , Digital Services Department  Urban Planning Department, Press Office.

BB: Budapest Brand, head of the Communications Working Group (WP4),.

NART: Nart Architects, responsible for architectural design Demo Hub (WP7), PCODE: PopCode Developments is the leader of the IT Platform Working Group (WP5)developing the Early intervention system

ULE: The Street to Home! Association, leader of the Early Intervention Services Working Group (WP5&WP6), brings the dimension of social inclusion, engagement and volunteering practice.

MRI:  Metropolitan Research Institute is the technical leader of the Monitoring Working Group (WP3), providing methodological and research expertise for the substantive implementation, monitoring and evaluation of the innovation solution and project performance.

BURST: The Burst Group is leading the Sustainability Working Group (WP8) and is supporting the networking of transfer cities and developing the AHA scale-up and expansion model for European cities.

KÉK: The Centre for Contemporary Architecture is the professional leader for engagement and community design (WP7), with extensive experience in placemaking, sustainability, circulation and aesthetics in experimental renovation.

MEHI:  Hungarian Energy Efficiency Institute contributes to the development of a service based on energy efficiency advice for homeowners and tenants (RenoPont).

Collective Leadership in AHA Budapest

AHA Budapest promotes a collective leadership model, ensuring that all project partners are actively engaged in decision-making and implementation. This approach strengthens partner coordination, fosters transparent communication, and supports timely responses to emerging challenges. The AHA Budapest model places a strong emphasis on bottom-up participation, actively integrating the perspectives of all partners, including those not formally represented in decision-making bodies.

This approach is further reinforced by community outreach efforts, particularly through the Housing Office, where social workers maintain direct contact with vulnerable groups. Their feedback provides critical insights that inform both service design and broader project decisions, ensuring that the voices of those most affected by housing exclusion are meaningfully included.

To support this structure, the project established the following governance mechanisms:

Governance Structure

The governance model is structured to promote collaborative leadership and effective coordination.

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Image: Budapest Brand / Képszerkesztőség

• Project Board
  Led by the Municipality of Budapest (MUA) Project Coordination Team, the Project Board includes the leaders of the thematic Working Groups. It meets weekly to monitor progress, provide updates, and address implementation needs.
• Thematic Working Groups
  The project is organized into eight thematic Working Groups, each responsible for specific focus areas and implementation tasks. These groups bring together Work Package (WP) leaders and partners, ensuring technical alignment and detailed coordination across all components of the project.
• Steering Committee
  Composed of the legal representatives of each partner organization and the project manager, the Steering Committee meets every six months to provide strategic oversight and make high-level decisions.

Decision-Making and Risk Management

Within each step of implementation, professional questions and risks are addressed collaboratively:

• Working Groups serve as the primary space for analyzing options and determining next steps based on collective expertise.
• Risks are assessed according to their probability and potential impact, with appropriate mitigation strategies defined at multiple levels.
• Major decisions are escalated to the Project Steering Group and Project Board, while overall coordination is overseen by the Municipality.

AHA Budapest first year achievements

In its first year, AHA Budapest focused on establishing efficient project structures to ensure the timely implementation of its complex social housing model. Following a neighbourhood needs assessment the Municipality finalized the selection of a publicly owned former school building to be transformed into affordable housing. The first phase of the architectural design for the “Demo Hub” building was successfully completed.

In parallel, the design and development of the Municipal Housing Office—a space accessible to tenants and newly established to provide information on housing services and needs—was initiated in February. The IT working group developed a basic back-office solution for the Housing Office, enabling the collection of customer data and follow-up services for households. Meanwhile, the prototype Early Warning System (EWS) has been progressing steadily, with its full development expected to be completed by 2026.

Demo Hub

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The first phase of AHA Budapest involved an in-depth neighbourhood analysis, which included identifying and evaluating buildings with the potential to be transformed into affordable housing. The project ultimately selected a publicly owned former vocational school located on Baross Street in Újpest. Originally constructed in the 1960s as a vocational middle school for the leather processing industry, the building had been vacant since 2007.

In the past year, NART Architects—a practice renowned for its socially focused and technically complex architectural projects—took on the design and implementation of the building’s transformation. Their task is to convert the structure into 26 modern, energy-efficient rental units, with completion expected in 2026. This initiative will not only provide secure, affordable housing for 26 families but also serve as a replicable model for the potential redevelopment of 15 additional disused public buildings across Budapest.

As of March 2025, the architectural design phase has been completed, and final planning permission has been granted. The Municipality of Budapest (MUA) is currently preparing an open tender for the construction phase.

The target group for the Demo Hub consists of Budapest residents experiencing housing poverty, for whom access to affordable housing represents a sustainable solution. The goal is to create a diverse and inclusive community of long-term residents.

Future tenants will receive comprehensive support, facilitated by AHA partners ULE and KÉK. This includes:

• The formation of a move-in group
• Individual assignment of a dedicated social worker per household
• A series of monthly community-building events for the first 9 months after move-in

Project Timeline Overview:

• 12 months – Planning
• 6 months – Procurement
• 12 months – Construction
• 3 months – Moving in
• 3 months – Co-living and closure activities
• 6 months – Monitoring and evaluation

Placemaking activities

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While the architectural and technical development of the Demo Hub was underway and the transformation of the former school building was in progress, the project launched a series of placemaking activities aimed at fostering social inclusion and integration. These placemaking efforts directly support AHA Budapest’s goal of fostering social cohesion and inclusive urban transformation.

AHA Budapest partner, KÉK – the Hungarian Contemporary Architecture Centre – took on the role of community builder and social facilitator, working to bring together local residents and future tenants of the affordable housing units, with the aim of uniting diverse groups into one cohesive community.

One of the first activities involved a group of architecture students from BME (Budapest University of Technology and Economics), who collaborated on a neighborhood mapping exercise around the Demo Hub.

The design of the Demo Hub already incorporates shared communal spaces accessible to both the immediate neighborhood and the new residents, including a 50m² community room, a rooftop terrace, a basement, and a courtyard.

As the Demo Hub moves forward, a key early milestone will be the partial opening of the building to host a series of community workshops. These workshops will engage both the local and academic community around the themes of inclusivity, co-creation, and community building.

Housing Office

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Image: Budapest Brand / Képszerkesztőség

In February 2025, the Municipality of Budapest (MUA) opened its Housing Office (HO) as a central hub to prevent housing exclusion and provide tailored support to households in housing crisis, including those at risk of eviction or without stable housing.

Primary Target Group; Municipal tenants of the Budapest Municipality.

Secondary Target Groups; Municipal tenants in district-owned housing ; Households in the private rental sector and homeowners at risk of losing their property

Key Services:

• Tailored social work: Supporting tenants with rent and utility debt management, contractual issues, conflict resolution, and financial counselling. energy efficiency, debt management, and access to financial and social services.
• Intensive support for households facing the most severe challenges.
• Referrals to other services, including:
  • Employment and health services
  • District social service systems (e.g., family help centres, mental health support, personal assistance services for persons with disabilities)
  • NGOs and external providers
• As a last resort, support in accessing the homeless services system (e.g., temporary or family hostels)​​​​​​​.

Early Warning System (EWS)

The development of the Early Warning System (EWS) progressed in two key areas during its first year. A series of workshops, organized by the service development working group, focused on analyzing the target group, identifying key stakeholders, and defining parameters that signal the risk of housing loss. Based on this work, a methodology was developed to assess decent and affordable housing conditions and to compile recommended preventive measures.

The Municipality of Budapest (MUA) reached an agreement with two pilot districts, where the Metropolitan Research Institute (MRI) conducted a series of in-depth interviews to map existing housing services and identify key challenges. In collaboration with these two districts, the EWS protocol will be co-developed, with plans to scale it up to include all 23 districts of Budapest.

The ultimate goal is to establish a functional information exchange between district-level social service institutions and the Municipal Housing Office, enabling them to track housing-related issues and receive feedback on changes in household situations.

IT Development

Following the first year of service development, the IT working group created a comprehensive development plan for the AHA IT platform, structured around three main modules:

1. Back Office Module – supporting the operations of the Municipal Housing Office;

2. Housing Cooperation Portal – designed for district-level municipalities, NGOs, and utility companies to facilitate collaboration and data sharing;

3. Public Housing Portal – aimed at residents, particularly those affected by the housing crisis, providing access to information and tools to manage housing-related challenges.

The design phase of the IT development began in Q4 2024, with the first prototype—the Back Office module—delivered in February 2025. The second module, the Collaboration Portal, is expected to go live in early 2026, while the Public Housing Portal is planned for launch in autumn 2026.

AHA Budapest- Year 1 Challenges

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Site Modification

The project faced a major early challenge when the originally selected site had to be changed. This was resolved through a collaborative decision-making process involving project partners and municipal authorities.

Technical Coordination

An extended and iterative process unfolded between the section designers and the Municipality of Budapest’s technical management company to align design proposals with technical and regulatory expectations. While the final architectural designs reflect input from both sides, the process contributed to overall project delays.

Stakeholder Alignment

Managing the expectations, inputs, and interests of a broad and diverse stakeholder base—including multiple departments of the Municipality—proved highly complex. The process is time- and resource-intensive, often slowed by bureaucratic procedures and administrative silos.

Political Environment

The 2024 local elections introduced significant delays in decision-making. The slow formation of the new General Assembly  further postponed key project actions, such as the selection of test districts for piloting the Early Warning System. Though external to the project, the political environment had wide-reaching implications, given the Municipality’s leading role.

Municipal Coordination

• Aligning the project’s operational structure with the administrative processes of City Hall presented ongoing difficulties—particularly in distinguishing between decisions that could be made internally by the project team and those requiring approval at the political or senior administrative level.
• Integrating project-related data into the Municipality’s central data management system was hindered by the rollout of a new data protection policy during the second semester.
• Internal departmental changes, including a leadership transition within the Social Policy Department, delayed collaboration with housing management units and slowed the design of the Housing Office’s service portfolio.

Mitigation Measures

To navigate these multifaceted challenges, the AHA Budapest team has implemented several strategic measures:

• Adaptation of Project Management Structures:
  The team continuously rethinks and restructures its coordination processes to improve agility and responsiveness.
• Inclusive Engagement of Partners:
  All implementation partners are actively engaged to ensure their input is reflected in decisions, helping to balance diverse needs and expectations.
• Leveraging Professional Diversity:
  The varied expertise within the consortium is a key asset in addressing technical, policy, and political complexities.
• Enhanced Internal Coordination:
  Efforts have been made to streamline communication and decision-making processes, both within the project and in coordination with municipal departments.

Conclusion

The AHA Budapest project represents a bold and holistic response to the complex challenge of affordable housing in urban settings. Through a multi-stakeholder, inclusive approach, the project aims not only to expand the supply of social housing, but also to improve energy efficiency, promote social inclusion, and destigmatize municipal housing systems.

At its core, AHA Budapest is guided by a collective leadership model that ensures transparent governance, continuous coordination, and meaningful engagement across all levels—technical, political, and social. Its well-structured ecosystem of Project Boards, Working Groups, and Steering Committees facilitates decision-making while incorporating bottom-up input from both partners and residents.

Despite navigating significant challenges—including administrative complexity, political transitions, and the coordination of a diverse partnership—the project has adapted with agility. It has continued to advance planning, community engagement, and service development, such as the Demo Hub, the Housing Office, and the Early Warning System.

By piloting new models, integrating lived experiences into design, and promoting sustainable urban practices, AHA Budapest is laying the groundwork for replicable, scalable solutions to housing exclusion. It serves as a forward-looking model for European cities, demonstrating that innovation, collaboration, and social justice can go hand in hand in the pursuit of adequate housing for all.