Problem with property in Budapest

Hi All,

I have been recently notified by my estate agent that the property in the complex I invested in is not going ahead due to an objection by a neighbour of the proposed site. I won't mention the estate agent.

The complex in question is called Continental Residence in district VII.

The estate agent has offered me an apartment in St. Kiraly Residence as an alternitave - still waiting on the brochure and price list. They say that they have agreed with the developer to get discount prices.

I have tried to find information about St. Kiraly Residence on the web but found nothing. I'm not even sure what district the complex is being developed in. The estate agent is due to send me the details next Monday.

I have so far paid 20% of the purchase price. The estate agent told me that I am entitled to a full refund.

My question is, has anyone else invested in Continental Residence, if so what have they been told.

Secondly, has anyone ever heard of St. Kiraly esidence?

Any help/advice appreciated.

Mack.

Hi Mack,

This development is more than likely in a pre-build stage. I'll see what I can find out.

Budapest

Hi Mack,

We also have dealings with the same estate agent. We had a meeting yesterday and have been told at the moment the solicitors are refusing to give back their fees, but this is still up for negoiation.

The Kilary Residences is in District VIII on Szentkiraly street just off Cossuthlrakoczi we are unsure ourselves if we should stay with this agent or find someone else.

We have a price list and have been told this is 5% discount off the current price.

Hi FloJo,

What prices have you been quoted for the Szentkiraly development?

The street is fine, but nothing amazing. It's just off Rakoczi ut in the better part of District VIII, close to Mikszath Kalman Ter, which has some nice outdoor bars. There is also a film school on the street, which is open to expat as well as local students.

Budapest

I think you should take the refund. The Hungarian economy is a basket case and if you can get out now, count your lucky stars.

With the devaluation of their currency rental will go down by the same percentage.

If I was buying in budapest now I would be looking for a much bigger discount because it's going to be much harder to sell apartments so they will need to sell for more realistic prices. I would get my money back first and then make the decision. While they are holding your money there is extra pressure on you. If they give you hassle about giving the money back then you're dealing with the wrong people.

I'd say there are a good few people in Ireland that will panic sell their apartments so I'm sure there will be bargains going around!

Just a reminder!

If it is their fault in not delivering and not yours, you are not only entitled to get your money back, but you are entitled to get double the amount (that served as a deposit) back !!!

I think that will depend very much on individual contracts signed! It's unlikely that such a clause is include in ALL contracts although, I conceed, it may well be the case in some instances.

In my experience, 99% of contracts pertaining to sale of real estate include a usually 10% amount serving as deposit, which under Hungarian law leads to the above conclusion. I am very confident in this, because investors building real estate for sale do need a security from the buyer when signing a purchase agreement.

I agree with you, Steven, that usually double the amount is refunded if the contract is broken, but I've also seen where developers can put a clause into the contract, where they are not liable to pay this if planning permission is not granted. It all depends on what was written in this particular contract.

Well then, Mack, I guess it is worth for you to check the papers! Looks like someone might be up to a 50% ROI

I've seen the pre-contract for Continatonal Residence and there is a clause which states that if the seller does not get planning permission then the buyer is just re-instated with his money paid only. There are no penalty payments.

I've havn't seen the final contract.

Hi all
Budapest - the prices are around 810000 euros per 50 sq mt on the 6th floor you can probably work it out from there
Question - would the Hungarian not experience the same growth as Ireland after the currency conversion into euros (ie the Celtic tiger)
Also to pull the investment now would mean back to square one after a years work. things do go wrong with new developments as hear in Ireland. being offered a 5% is tempting