John Farago's post is pretty comprehensive. I recently answered a similar question here: http://www.chowhound.com/topics/471279#3240447
If you can afford the 4 Seasons, do it. It is the best hotel in Hungary, bar none. If you are more budget-minded, try the Art'otel Budapest.
I would stay away from the Gundel and the Gellért ---- I feel strongly they are dinosaurs who may have been great at one time, approx. 100 years in my estimation, but have long been passed by.
If you want to try rustic Hungarian food with the gypsy music experience, try Margitkert or Kárpátia. I like Margitkert better, but my grandmother loved Kárpátia.
Regarding specific foods to try in Hungary ---- here are a couple of suggestions:
1) Lángos (Pronounced 'LAH-gosh') --- one of my favorites, fried dough with sour cream and cheese --- http://en.wikipedia.org/wiki/L%C3%A1ngos
2) Gulyás (Pronounced 'Goo-yAHsh') --- remember goulash is a soup in Hungary, not a stew as in North America or Western Europe --- http://en.wikipedia.org/wiki/Goulash
3) Foie gras --- in Hungarian: Libamáj (Pronounced 'Lee-ba-mAHy') --- Hungary produces an enormous amount of foie gras, some say that most of it is exported to France and then re-exported as 'French' foie gras. I dunno how true that is -- but I can say that foie gras is relatively high quality and relatively inexpensive compared to Western Europe. All or most of the better Hungarian restaurants carry at least one foie gras dish, it is hard to go wrong. I like Café Kör for their foie gras as well as everything else.
4) Hungarian pastries are pretty damn good. If you can try a slice of Dobos Torta --- pronounced 'Doe-boesh Torta' (http://en.wikipedia.org/wiki/Dobos_Cake) --- Gerbaud is not bad, neither is Ruszwurm.
Last thing, DO NOT eat at any of the restaurants on Váci utca, for the most part they are sub-par 99% tourist traps --- (with the exception of Fatál, do not be put off by the name, it means 'Wooden Platter').
Let me know if you have any more specific questions.
My favorite ever restaurant in Budapest- I'm afraid I'm deeply in love with Bagolyvar. I think in comparison Gundel is ridiculously over-rated and oddly Francophilic. Bagolyvar in fact draws its wine selection from the Gundel cellar, and I always order the special (I think they call it family) menu because it never disappoints.
I second the recommendation for Voros & Feher on Andrassy ut. - we loved the wines and were more than impressed with the food (we had NO expectations food-wise, but it was recommended to us as a wine bar by the proprietor of a wine shop where we bought a good deal of wine). We would have returned had we had more time in the city.
We also enjoyed Gundel - we did a tasting menu and I would NOT do that again (too much food, probably not the best showcase of the menu/kitchen) but the experience was quite lovely and it really is a gorgeous place. I don't often care about the decor and such if the food is good, but it was old-world and quite relaxing. We would go again, but order off the menu and pop for a nice bottle of Hungarian wine.
Overall, the wine in Hungary was the highlight of our trip - really quite amazing, and so difficult to find in the US/UK/France.
the greham palace/four seasons is an astonishing restoration; it is definitely worth seeing, and the food is excellent, at least if one judges by the cafe, which is a marvelous place to sit and have anyting from very good, if not exactly traditional Hungarian, pastries to a full meal; have not as yet seen the rooms or tried the full restaurant, but the service on the ground floor and in the cafe suggests that it is likely among the great world hotels over all
which is not an argument against the gellert, just an observation that the two are different in kind, not quality...also note that because the greham palace is a restoration, ambience is not at all like any of the hotels built in the 20th century, and because it has been done recently, and exquisitely, and by an entity that looks to have been seeking either a tax loss, a way to launder money, or a very ver long-term investment the quality of the work is unlike anything i've seen in budapest other than the municipal public library
having said that, there are no must-eats in budapest, sad to say, though there are plenty of places to go to fend off catastrophe; depends on what you are looking for . . . Borbirosag, behind the Central Market Hall (on Vamhaz ter) is a very. very good hungarian restaurant with an extensive range of wines by the glass; Voros & Feher on Andrassy ut. is pleasant, upmarket, and also a serious place for people who like wine; if you are doing anything around the Opera or the Music Academy, somewhat behind them is the old artists' club Feszek with a large open-air restaurant that's a pleasant place to sit on an evening with decent weather and the food is tolerable
sitting is more of a pleasure than dining, at least for me in Budapest; the cafes on Raday are, by and large, good places to sit outside, drink beer, and talk...the Castro on Raday is less touristy (*it's more or less at the end of the cafe run) and as recommended by Zaelic here, has excellent kabobs and the best gulas soup i've had in BP
the reviews in TimeOut Budapest are solid and the backlog of reviews that you can find online at www.budapestsun.com is a decent guide from a sort of expat perspective rather than a tourist point of view
pastry is onl;y fair by and large, but Gerbeaud in Vorosmarty Square is a wonderful place to sit even if it gets a bit lost in being a tribute to itself; perhaps even better is the Central Kavehaz (Coffeehouse) not far from there
it occurs to me that i am simply rewriting the high spots of the restaurant list i leave for guests in my Budapest apartment, so at the risk of overkill, i'll cut and paste the entire thing below (apologies for any repetition):
Sadly, at least for me since I love Hungarian food, Budapest is not really a great eating city. Sixty years of totalitarian regimes, poverty, and sending the best produce off for export (with a policy that focused on quantity not quality) have taken their toll. And there is a seeming aversion to butter, so the pastry suffers. But the goose and duck liver is plentiful, the wine can be quite good, and the café life is great.
Being close to the Central Market makes eating in a tempting option; lots of great salami and wursts and cold cuts; a supermarket in the basement of the market hall for packaged goods, and an excellent Asian and exotic foods place on the basement level as well. There are wild game butchers, fishmongers, and pickle stalls on the basement level, and the central authority that certifies wild mushrooms as non-poisonous is in the Market building, so its a good place to buy fungi they display the little paper slips of certification next to the mushrooms usually. The farmers market is in the extension of the building closest to our apartment, and when things are in season theres great fruit and mushrooms and honey and milk and eggs. When they arent, its mostly just dairy, nuts, and stuff in bottles. The most high-end of the fruits and vegetables seem to be in a stall about half-way down the market hall on the left (facing into town, with your back to our apartment). Its a corner stall on the right side of the leftmost lane of the market (by corner I mean that theres a lane running perpendicular to the left hand lane, and its at the intersection).
Bacon and similar meats can be wonderful; I tend to buy them from stalls relatively close to the apartment end of the market: the poultry stall that takes up one side of the farmers market section of the building, and in the main building just a bit inside on the right hand side of the middle lane, the meat stall closest to our apartment.
Theres a guy who sells fresh orange juice by the glass at the end of the Market nearest our apartment (but before the Farmers' Market part of the building), and nearby there are pay toilets for the desperate (clean and well maintained; 70 HUF admission) and the exchange rates at the currency exchange booths in the Market are not a bad place to exchange money.
On Raday there are a limitless number of bars, a not-bad pizza place (Pink Cadillac); a restaurant we liked a good deal but a friend didnt [Id go back, it's called the Soul Café], and the Castro, an often-crowded and relatively smoky, but genuinely wonderful café, with terrific goulash soup. Other places weve liked include
Borbirosag Csarnok ter 5; 361 219 0902 a wine tasting bar and restaurant with really wonderful veal paprikas and other food, just behind the Central Market (on the right side of the square behind towards our apartment, facing the Marketthe Market Hall, almost at the Market building.
Trattoria Toscana tel: +36 1 327 0045; Belgrad rakpart 13;
open hours: midday-midnight daily; genuinely excellent Italian food, with the best bread Ive had in Hungary
Taj Mahal: VI. Szondi utca 40; Tel: (+36-1) 301 04 47; 12:00-23:00 except: Monday: Closed; havent eaten there; this ones a rumor I plan to check out
Kadar Etkezde, VII. Klauzal ter 9, Tel.321-3622; a great hole in the wall neighborhood restaurant with very good home cooking; on a square thats about a dozen blocks behind the Synagogue and 3 or 4 behind the Liszt Music Academy
Etkezde (an etkezde is a little mom-and-pop lunch place with a traditional Hungarian menu; sort of a poor persons socialist take on a bistro) on Raday: during lunch hours, theres a small etkezde that I havent tried yet but that smells quite appealing; its on the west (Danube) side of the street, I think between Matyas and Kinizsi
Feszek: Feszek Muveszklub etterem; 36 1 322 6043; Kertesz utca 36; District VII; an outdoor café in a courtyard of the old artists club. Huge and open very late (24 hours?) and decent food, inexpensive and a great place to sit; easy walk to the Music Academy
Tai-Wan Restaurant: 1097 Budapest, Gyali ut 3/b Tel: 215-1236; not bad, not cheap by Hungarian standards, Chinese place in a difficult to find location thats pretty out of the way (in the Fortuna Hotel (a pretty dingy place) just off the Blue Line Nagyvarad ter stop on the metro.
The cheap Chinese buffet place on Raday is tolerable in a pinch.
Kék Rózsa Étterem: Budapest VII. kerület 1077 Wesselényi utca; behind the Synagogue, a good place for deep fried stuff.
The Café Central, which is our favorite café to site and feel mitteleuropaische in, also is quite a decent Hungarian restaurant and serves lunch and dinner as well as excellent breakfasts (the sausages at breakfast and the soups served in loafs of bread are particularly good; if you like chicken livers, the "small plate" of roasted chicken livers which are actually sautéed with peppers and onions and paprika I think is excellent).
Palacsinta (crepes): oddly, the best Hungarian dessert crepes Ive found have consistently been at an open-air stand near IKEA at the end of the Red Line metro; If you get off the metro at the last stop and head for IKEA and the mall across the street from it, across from the supermarket theres a line of these small food kiosks, and one of them is a palacsinta place
Hot Tables/Cafeterias: I have to admit that a couple of the best meals Ive had have been at steam table cafeterias in high volume locations. In the Central Market Hall, upstairs, on left side as you face towards the center of town; the longest and most extensive of the steam tables, furthest away from downtown; I really like their stuffed peppers, and pretty much anything that looks like gulas, porkolt, or paprikas is better than decent; at the West End Mall, in the food court, the next to last of the steam tables on the left as you move away from the center of the mall its called something like Vitamix; I like their goose and duck chunks
Pastry: Thus far I havent found anything to be crazy about; too little butter for my tastes; I prefer the Hungarian pastries in NY (none of the strudel, for instance, holds a candle to that at the Neue Galerie's restaurant in NY). But Gerbeaud is a destination in its own right (Vorosmarty Square), just for its history (and the pastries arent bad; the people watching is good, and its central). The cukrazda (pastry shop) on Raday near the Sir Morik coffe place is as good as many (I like their Linzer cookies especially), and their ice cream is quite good. In spring, summer, and fall pretty much every place on Raday has tables and chairs outdoors, even the cukrazda and Sir Morik (which are adjacent to each oither). HOT NEWS: There's an excellent pastry shop further away from the center of the city along Raday, about a block or two past the Castro (past Kinizsi utca towards Bakats ter), on the Danube-wards side of Raday. It's as good as any I've found. If you are at the other end of town, near Falk Miksa utca (the street that has all the best antique stores in town, though not the least expensive ones), on the Szent Istvan krt there's a large good cukrazda called the Café Europa. And there's a very good one near Rakoczi ter (not Rakoczi ut, Rakoczi ter).
Beer, wine, liquor: Are available from most supermarkets. The selection is surprisingly good, though not spectacular. The wine shops on Vaci ut are overpriced, and the selection in the Central Market is very tourist-oriented and low end in terms of quality for most things. Theres a good, not overly pricy fancy wine shop on Raday utca between Erkel and Matyas.
Cafes: The Castro at Kinizsi and Raday is close to us and is a great place to sit, drink, surf the web, and hang out. The Café Central, Károlyi Mihály u. 9, is a great place to sit, is open 7:00am-1:00am, and oozes mitteleuopaische vibes. The cakes are nothing special, the omelettes are ok, but the atmosphere is wonderful. For a mcup of coffee or tea, there are numerous teahouses and cafes on and near Raday utca, but we tend to favor Sir Morik if one really wants a cup of coffee or tea and not justy a place to sit. Opposite the Operetta Theatre, iof one is out that way, the Mai Mono coffeehouse is very pleasant and unassuming.
The Commedia Restaurant opposite the Operetta Theatre is rather good and a pleasant place to sit; the cast seems to hang out there after the show sometimes.
re: john farago
We were in Budapest in September, 2007. We stayed at the Andrassy Hotel, expensive, but highly recommended. A short walk to Bagolyvar, a sister restaurant to Gundel, offering good, home-style, Hungarian cooking at very reasonable prices. I had been put off by reviews of Gundel, which made it sound ordinary and over-priced. When we looked at the menu, posted outside the restaurant, I sensed that many of the reviews were written by veddy, veddy serious foodies who always choose the tasting menu and the most expensive wines. We went and had a very satisfactory dinner, at a rational price, in a setting that was magical and with charming and competent service. If you go to Budapest, pack a blazer and opt for Gundel for one dinner. My only regret is that we didn't have the opportunity to try Borobislag, mentioned above. If there is a next time in Budapest, it will be on our list.
re: john farago
a bit of an addendum: Voros es Feher is no more; it has been replaced, more or less, by Klassz (also i believe owned by the Budapest Wine Society), no reservations, quite good, very trendy...arrive before 19:00 to get a table with relative ease
Segal is a marvelous restaurant (Viktor Segal was the original chef at Baraka, giving it its reputation and designing its menu; when Baraka moved to the Andrassy Hotel, he stayed in the old location and opened an eponymous restaurant (an extraordinary culinary boite), which recently closed so that he could open a new place on O utca...by mid-January the new place should be in business, almost at the Korut, not far from Oktogon or Nagymezo utca
let me stress two places i really love: Cafe Bouchon and Cafe Gerloczy; both remarkable little Hungarian takes on the bistro motif, both owned and run by people with vision and soul, both lovely, simple places to sit and eat well; Bouchon is on Zichy Jeno utca just off Nagymezo, the Gerloczy is on Gerloczy utca just behind Deak ter and very close to the dread culinary wasteland of Vaci utca
Ocean, by the river, just north of the Elizabeth Bridge is a wonderful seafood place (i generally flee from fish restaurants in landlocked countries) opened by the original chef from Toscana; talented guy (and Toscana is a shadow of its former self without him); very interesting food...a cucumber panna cotta still lingers at the edges of my visceral memory
i am trying to keep these impressions current at the website
(still under development)
See my report below from last year. I recommend going to Gundel simply because it's such a classic old world European place in terms of setting and service, and overall the food was good. I'd definitely return to Arany Kaviar, but it's Russion, not Hungarian (I'm both). Our lunch at the Citadella was very good but I can't say how that would have translated to dinner, and it's sort of out of the way. Use the public transit system as much as possible. It works well, is easy to understand, and the taxis charges will kill you.
Late June should be wonderful outdoors at Remiz Restaurant in Buda. The Gresham Palace opened after we moved away. Well heeled travelers gravitated to the Hyatt or the Hilton. Might be more fun to stay at an old world place like the Gellert, Astoria or the Beke. Eat lots of goulash. We have not been able to match it anywhere.
stay at the gellert, it is an institution - not exacly 5 stars, but it is great.
do the baths, the gellert has great baths, but there are others, too.
100 year resteraunt is pretty good.
go to the food market in the morning, have coffee and a pastry, walk around, have lunch upstairs.
Gellert is definitely an institution. However, that is not a reason to stay there. In fact, it is quite run down and in need of some attention to detail.
I went once in 1984 and again in 2004. The second time, I truly regretted not staying somewhere else. In addition, the spa is especially in need of some attention. It seemed to me that NOTHING changed (including usual maintenance items) since my last visit.
My parents have since gone and stayed at the Four Seasons. They stayed with us at the Gellert both times. As you may know, it is consistently ranked one of the best hotels in Europe (I think its Conde Naste or one of those others...). My parents could not stop talking about how nice it was and how outstanding the service was.
If you are considering the 4 Seasons, just do it. You will not regret it, unless you stay at Gellert and visit the 4 Seasons.
The market is a must as Zach mentioned. Dont miss upstairs. Its easy to do.
One of my best meals ever was at Gundel. Now I have to admit, I was a little caught up in the fact that I was with relatives from Hungary that I had not seen in ages, so I'm sure that played a part in Gundel being a fav. However, given the majority of what I have read about it on CH since, I would sat it's a must.
The best stuffed cabbage we had was at Carpathia. They usually have a little gypsy band playing too. You know, on a side note, the stuffed cabbage and cucumber salad at the Gellert's outside cafe was also very good.