Hungary's housing market is facing a turnaround as both supply and demand are decreasing, with transactions dropping by 34% year-on-year in September and demand for mortgages declining, the National Bank of Hungary said in a sectoral report on Thursday.

"The annual increase in housing prices probably slowed markedly already in the third quarter after rising by 24.8% in the second quarter," the bank said, adding that most banks expected a drop in credit demand. (Reporting by Krisztina Than)