Key Post: First Time Investor...thinking about Hungary!

P

piggy

Guest
Hi,

I'm a first time investor but not quite sure where to put my money. I've been avidly reading posts on Askaboutmoney for the last week or so and have learnt quite a lot really. As to is there a bubble in Ireland, isn't there I do genuinely think that now is not the best time to invest in property (at least not in Dublin). At the very best house prices will rise with inflation. Obviously I could be totally wrong and history may well prove me wrong.
I've also recently started reading the Rich Dad books. A lot of good stuff in there. Anyway, onto my point - I hadn't given any thought to investing abroad but have been reading up on casaro, the Hungarian real estate people www.casaro-hungary.com and find the whole thing quite interesting. Obviously you can buy a stinker of an apatrment for 25,000 euro and renovate it in the hope that you can rent and that the apartment will rise in price (which it likely will). Then you could also buy a very plush apartment (the like of which would cost you 700,000 here for 250,000 - 300,000 in Hungary.
I have a lot of thoughts on the subject and this isn't the place to bore people with them. Really what I want to find out is other people's expreriences and more importantly advice on the subject. Any investors own property in Hungary or have any dealings with Casaro or general advice on whether to go down this raod or not?

Has anyone bought over there and what do they think in general about it.

Obviously it is a lot more risky. I'm willing to be risky as I'm young.

I'd really appreciate any input.

Thanks,

Piggy.



Edited to fix link
 
Re: First Time Investor...thinking about Hungary!

Hi piggy,

Welcome to Askaboutmoney!

As you say that you have been reading posts on Askaboutmoney for the last week or so, you probably have come across but here goes anyway! If you haven't, it might be worth checking out the links contained therein which may (or may not!) be useful to you.
 
Thank you

Thank you very much endowed. I had read the link alright but thank you nonetheless.
If there's anyone who has had hands on experience I'd be very keen to hear what they had to say on the subject of buying in Budapest for investment purposes.

In the meantime I'll continue checking out any links I can on the subject and reading Rich Dad books. For anyone who hasn't read any Rich Dad books I'd strongly recommend them.

On another note, perhaps someone might know of anywhere I can check out in Ireland (be it websites or otherwise) where there is information on seminars or events that may have anything to do with building businesses or investing (be it in property or otherwise). I really am a bit of a newbie but very keen to learn as much as I possibly can.

Thanks again.
 
Re: Thank you

Hi Rainyday,

I have read the guide yip. Thanks. And I'm sure I'll reference it again in the near future. I'd really like to attend a seminar of some sort though on the subject, or as I was saying maybe building up a business.
I'm even giving some thought to Rich Dad's seminars in the States, although expensive, at $5000 a pop, I've heard they're worth their weight in gold. Anyway, Im just wonering if anyone does this type of thing here in Ireland?

Thanks again.
 
Re: Thank you

Hi Piggy,

I hope this doesn't come across as smart or anything but if you are considering investing in property you really need to do your own specific research to find out what are the best opportunities on offer, and to inform yourself about the tax, legal and other consequences of any decision you make to invest.

Motivational seminars (particularly USA-based ones) may be a good source of ideas but they won't necessarily be of any practical use to you.

Personally I wouldn't touch a $5000 seminar with a bargepole, simply because (in all walks of life) there are many stories in the past of such ultra-expensive seminars being used as a scam to rip off participants.

The formula seems to be to put together a package of run-of-the-mill "advice" and dubious motivational-speak, (often a rehash of the material that you will find in a a business management or self-improvement book for €15 in Easons), dress it up as something "unique" and "special", charge a ridiculous price, and laugh all the way to the bank.

I'm not saying the USA "RIch Dad" seminars are necessarily in that vein, but if you're thinking of paying $5000 I would suggest you would get more value by spending a fraction of this sum on professional advice.
 
Re: Hungary

Yes FK, I've been there on three separate occasions. One quite recently. Nice place.
 
Re: First Time Investor...thinking about Hungary!

Hi Piggy,
I have also looked at property abroad and with hungary and poland coming into the EU it seems, perhaps a better investment than here. Like yourself I would be very eager to hear from or about anyone who has purchased and sold in Hungary. I also think those books are good, but i think seminars sound OTT.
 
Re: First Time Investor...thinking about Hungary!

Just stop & think for a minute, guys - If the 'Rich Dad' guy really had an easy, guaranteed way of making his fortune through property investment, do you really think that he'd be spending so much time writing the books and doing the seminars? I don't think so - It's clear that he's found the books/seminars make even more money than the property investment.
 
Re: First Time Investor...thinking about Hungary!

Hi again,

This shouldn't be an arguement about Rich Dad. I personally believe that his books have a lot to offer both young & old investors and it has certainly opened my eyes to new things. But everything is personal. From having just read his latest book I can tell you (if you are to believe the man) that he is making millions every year from having moved from $4 million investments up to $10-20 million investments in housing accomodation for the lower class (funded by the US government). To my mind the man is more of a growing empire rather than anything else...with business interests (his books & games) as well as real estate investment interests. Regardless, this is not about him.
I also don't believe that there's an easy way to get to the top but reading about previous success stories and listening to successful points of view can only help you.
 
Re: First Time Investor...thinking about Hungary!

Hi EanBrown,

I certainly agree that the EU will have a big impact on Hungary and othr countries coming into the EU. Keep me informed of any info you might have or experiences please and I will post anything when and if I have dealings over there.
 
Re: First Time Investor...thinking about Hungary!

Hi Piggy,

Robert Kiyosaki (the "Rich Dad" guy) would advice that, as a novice investor, you should stick with your home market - buying properties that are no more than one hour's drive from where you live. Even at current values, he seem to believe that you should cut your teeth in Irish property before thinking about investing overseas.

See this .
 
Re: First Time Investor...thinking about Hungary!

Hi Moneybags,

Yes, I did read the topic and found it interesting. It's possibly why I'm unsure about going to invest in a foreign country for my first investment. On the one hand it looks like you could make a lot of money in real estate over there. It looks like a good time to get in! On the other hand there's my inexperience.
A lot to mull over!
 
Re: First Time Investor...thinking about Hungary!

Hi Piggy,
I was talking with a guy in maynooth(got the number from the article in the sunday business post) and it certainly sounds very interesting. I agree with all the people who say its a lot of hassle but I think if the property appreciates the way it is supposed to in budapest then it is probably worth the investment. The property has already(apparently) risen by 15% since janurary already. thats hard not to take notice of.
buying in ireland would be more of a risk than buying in budapest i reckon. The ireland boom is over so if its investment your looking for i would reckon to look to another place where a boom may happen!

also as for the rich dad guy, Clubman, i have heard that argument a million times about other succesfull people, " if their so rich why do they have to write books?" All I have to say to that argument is why does tiger woods still play golf, why isnt michael jordan retired? why did roy write a book? why hasnt oprah winfrey given up? why is tony robbins and people like him still going when they clearly have hundreds of millions? and why is the pope still around? COS THEY LIKE IT and they like telling us about it, and more power to them.
p.s. the rich guy dad thing also never claimed any easy solution. just some solid foundations on how money works.
 
Re: First Time Investor...thinking about Hungary!

Hi Ean,

BTW, it was Rainyday not Clubman who made the earlier point.
 
Re: First Time Investor...thinking about Hungary!

Yes I agree. The boom is over in Ireland (at least in the short term). I suppoe it's what you're looking for. Property here is still a good long term investment....not ashort term one (unless you know builders who will get you pre-launch prices)! That's a whole different kettle of fish though.

The Hungary thin is very tempting and looks very promising. Obviously someone else will look after the proprety (properties) for you which means forking out more than if you were there personally, but I think this is acceptable if you have a good property in a good sector of Budapest, and especially if the prices soar as people believe they will. Its a gamble at the end of the day I guess...a calculated one.

I'm going to talk to someone over there soon...maybe the Casaro Hungary crowd over the phone to see what they're saying.
 
Re: First Time Investor...thinking about Hungary!

Hi guys - Just keep in mind that those who may be advising you on these purchases may well have a vested interest in encouraging you down that road - So you might want to take the advice with a pinch of salt, just like stockbrokers analyst reports or Irish estate agent reports on the Irish property market.

Hi EAN - The examples you gave don't relate to the Rich Dad scenario. I wouldn't question Tiger for still playing golf or Oprah for still presenting her show. But the Rich Dad guy is doing just the opposite - He's spending a substantial amount of time talking/writing about how to make money by this method. It would be like Tiger taking year off to write a book about how to make money from PGA golf, or Oprah taking time to write a book on how to make money from her media empire - They don't - they 'stick to the knitting'.
 
Re: First Time Investor...thinking about Hungary!

Budapest is a lovely city (I was there for a week last year)and on the surface looks good for an economic renaissance, but if you are investing in property there you will need to consider it carefully.

A few points to ponder:

1. You will need to make your own decision about the Budapest's and Hungary's own economic prospects - factors such as:

- demographic trends, trends in the education system, attractiveness for inward investment and tourism.

- the Hungarian Govt's public finances and tax policies - can they afford to reduce taxes to stimulate economic activity?

- availability and demand for labour

- the incidence of poverty (some of the things you see around Moskva Ter and the seedier side of the Inner Ring Road would open your eyes) If poverty is a big problem in Budapest, it will swallow govt resources and tax revenues for decades, while discouraging foreign investment.

- inflation, the stability of their currency and the risk of currency devaluation

- is Hungary's economy vulnerable to any continued decline in the German or wider EU economies? To where do Hungary export their goods? Are these markets stable?

2. You will need to look at the property market over there

- Are Hungarians themselves investing? If not, why not?

- What are the average rents (when I was there I read in some of the expat-oriented papers that rents were indeed very low except for select properties aimed at expat professionals, diplomats etc

- Is the market currently being driven by actual returns or by hopeful outside investors?

- How would their systems for income tax, capital gains, Stamp Duty, rates and other levies impact on your investment?

- What will be the impact of their legal system on your investment?

- What development policies are in place? For example the existence of grants or tax breaks to Hungarians to revitalise certain areas or types of property might increase or devalue your own property.

3. Consider the specific location very very carefully.

- Is it on the tram or metro lines? (the trams are especially convenient in central Budapest and I would imagine it would be a huge help to be 100m-200m from a tram stop)

- What is the neighbourhood like?

- Is traffic congestion a problem in that area? (we saw a lot of traffic jams when we were there)

- Proximity to mainline rail stations and shopping centres would also be big pluses.

4. Finally, if you are thinking of investing over there, I suggest you should learn the local language and spend a week or two over there sussing everything out for yourself.

Don't confine yourself to agencies who cater for foreign investors -they are likely to tell you all the positive news while supressing all the negatives. Remember they are in for a hefty commission at your expense, if you buy through them. Talk to the agencies who deal with Hungarians. Read the ads in the papers over there and make up your own mind.

And most of all, best of luck!
 
You must log in or register to reply here.
Back
Top