The opening of a major Mercedes auto manufacturing plant will undoubtedly breathe new life into the local economy of Kecskemet, a town of 110,000 inhabitants located 85km from Budapest, the Hungarian capital city.

Mercedes officials announced that the German luxury auto manufacturer would assemble one of its major models in Hungary and this plant would supply the entire region.

While this new factory will create thousands of new jobs in Kecskemet, it is already starting to push real estate prices up.

For example, according to a report in HVG, a weekly Hungarian financial magazine, the German auto manufacturer has decided to buy up sizeable plots of land around the plant, which is scheduled to start producing the first vehicles in 2012.

According to the most recent estimates, Mercedes will invest more than $1.24 billion in Kecskemet over the course of the next three years, as it prepares for the opening of its newest Central European plant.

The German auto manufacturer will provide employment opportunities for around 2,500 local Kecskemet residents and will help revive the area’s economy.

The opening of this new factory means that it may be wise to purchase real estate in what is Hungary’s eighth largest city, before prices really begin to increase.

It is generally best to purchase flats in heritage buildings in or near the city centre, and especially in close proximity to major local attractions, such as the City Hall or the Jozsef Katona Theatre.