After the political and economic changes of 1989–90, the concept of gentrification inspired many urban researchers in central and eastern Europe (CEE). Despite the growing number of papers, there is still a substantial empirical gap concerning the transformation of inner-city neighbourhoods in the CEE. This paper is based on empirical data regarding the physical and social upgrading of neighbourhoods in inner Budapest. The paper argues that gentrification in its traditional sense affects only smaller areas of the inner city, mostly those where demolition and new housing construction took place as an outcome of regeneration programmes. At the same time, the old housing stock has been less affected by gentrification. This is mainly due to the high share of owner-occupation and the social responsibility of local governments. Thanks to renovation and new housing construction, a healthy social mix will probably persist in the inner city of Budapest in the future.

Large housing estates in former state-socialist countries had been hardly affected by social erosion before the political changes. However, the emergence of new, capitalist forms of housing after 1990 started to endanger the position of large housing estates on the local housing market. The question was repeatedly raised in the literature about whether large housing estates of post-socialist cities would experience physical decay and social downgrading similar to the West. This paper investigates the socio-economic differentiation of large housing estates in the former state-socialist countries using a case study approach. Housing satisfaction and mobility of residents in four post-socialist housing estates were analysed through a standardised household survey. Empirical data confirm that despite their similar physical appearance, the attitude of people towards large housing estates and their position on the local housing market vary significantly. The authors conclude that even though socialist large housing estates are affected by social downgrading, nevertheless they represent relative social stability and can offer affordable housing to people who are at the start of their housing career.