Selling Budapest Apartment

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Pinchy

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Hi All,

I have considered all my options and have decided that I want to sell my Apartment in District 11 in Buda. I want to get as much market coverage as I can, can anyone recommend a responsible sales agency in Budapest.
English will be necessary also. The only thiing about putting it on the market there, it may jeprodise any profit that I would have made over the last 2 years.

Any thoughts on this ?

Thanks, J
 
Don't think there is any profit to jepordise. I am currently selling an apartment that I bought in 2004. I will be happy to get out with a 10k loss (if you take into account fees, stamp duty etc)
Budapest (another poster) recommended Duna House to me and I have to say I am happy with them as everything is quite professional. If you PM me, I can give you the email address of the agent I am using there.
 
Unfortunately, estate agents in Bp who can reach an international market are really not all that great. However, to reach the widest possible audience, it is probably your best bet. I wouldn't necessarily recommend a particular agency in the city. Instead, I recommended a specific person to amgd28, who I found to be very helpful, unpressurising and straightforward in his approach. He happens to work for DH, but as so many others do as part of an extensive franchise, it's important to recognise the difference between recommending the person and the company. I've also dealt with very competent agents with Otthon Centrum, another big international agent over here. The downside of dealing with the bigger agents is that fees are extremely high - sometimes up to 6%, when you include tax.

In addition, you could also try advertising it yourself on ingatlan.com and maybe on daft.ie also.

Generally speaking, smaller local agencies are much better to deal with, but they won't give you international exposure and you'll be lucky if any of the staff even speak English!

Another useful thing to know is that estate agencies generally do not have exclusive rights to a property and almost always, you can use more than one agent as well as privately trying to sell the property.
 
Hi Pinchy,

One way of getting international exposure is to get your property listed on www.rightmove.co.uk. The best way to do that is to place your property with a Bp agent that advertises on the site - for example Gateway Properties, who are based in Bp (www.gatewayproperties.co.uk). I have no experience of selling Bp property, only buying, but I came across Gateway Properties (Dominic Ward) at a time when I was trying to find a property finder in Bp. On the plus side from a selling point of view, I do receive e-mails fairly regularly from Gateway Properties advertising mostly classic apartments and they always follow up with a telephone call. They also have English-speaking staff!
 
Hello Pinchy,

Selling an apartment in Budapest might be a hard job, nowdays. You have several options if you want to go with big estate agencies such as:

- A1 http://www.a1ingatlan.hu/
- OC (Otthon Centrum) www.property.hu
- RE/MAX (New agency) [broken link removed]

If you want to sell it as soon as possible I suggest you choose one agency and give them exclusive right to the property. Exlcusive right means more work for them and agencies would prefer selling it sooner than normal apartments because they are under higher pressure. I suggest you discuss it with the agencies.

Anyway, exclusive right has advantages and disadvantages but it may take positive effect on your prospectives.

Best of luck with it!
 
amgd28 said:
Don't think there is any profit to jepordise. I am currently selling an apartment that I bought in 2004. I will be happy to get out with a 10k loss
Click to expand...

Is the market that bad over there that there has been no appreciation in approx 3 years. Is this due to the currency devaluation last year?
 
Hungary said:
Exlcusive right means more work for them and agencies would prefer selling it sooner than normal apartments because they are under higher pressure.
Click to expand...

I don't see the logic of this. Non-exclusive estate agencies make more sense if the seller wants to reach a wider international market. Different agencies have different contacts/alliances, etc. Good agencies will try to sell good apartments regardless of exclusivity or not.

beattie said:
Is the market that bad over there that there has been no appreciation in approx 3 years. Is this due to the currency devaluation last year?
Click to expand...

The market is weak for low quality stock at the minute, of which there is plenty in Budapest. Investors bought all types of property about 3-4 years ago, often at prices higher than market value. The current situation is that investors only want better quality apartments at reasonable prices. Due to oversupply and many many other reasons, there has been little or no appreciation of lower quality apartments.

Overall capital appreciation of second hand apartments from end 2005-end 2006 is suggested to have been 6.77% by the independent website 'ingatlanpiaci.info'. This is a significant turnaround from end 2004-end 2005, when values of second hand apartments went down by 0.93%.

The currency is now the strongest it's been since Summer 2005. Currency devaluation didn't happen last year.
 
Budapest,

Exclusive right is an option for seller if s/he wants to get a special service. I expect you do not know what it means. Different agencies have different business manners in relation to sale strategy.

It is a good point. Good apartments are sold soon but bad apartments are not a piece of cake. Exclusive right might be a good option when the seller would have difficulties in finding a buyer. Estate agencies prefer good apartments and they will not try to sell bad apartments because they need to put efforts in sale process.

Selling a bad apartment is another story. You are talking about good apartments, prime locations, etc. Budapest is not pink please!

To be honest selling good apartments does not need estate agency at all:)
 
Hello beattie,

Buying up Budapest from 2000-2004 has lead to overpriced property market. No capital appreciation is the part of the process called re-pricing of property market:

- phase 1: over expected market with high prices
- phase 2: unfavourable market with decreasing prices
- phase 3: good mid and longterm expectations with stable prices
- phase 4: new market environment with new expectations

This is a cycle and Budapest is between phase 2 and 3.

I do not want to go into details because it would be a long story. But it is better to know how the things are going over here.
 
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i see the currency today is 246 forints to the Euro and seeing that i bought my appartment in forints and have my deposit paid with the remainder due by march of next year it seems that if the currency continues this way i will have to pay over the odds for my apartment. what is the prognosis for this trend to continue in Hungary. I also see on the website www.portfolio.hu that they are thinking of dropping the band of the currency so that there could be further fluctuations in strength of the forint. will the forint stay at this level from now on do you think? the reason im asking this question is because this currency volatility is there im not sure what money i am to budget for for the final payment and therefore makes it a lot harder for me to get cash together all answers would be appreciated
 
Hungary said:
Exclusive right is an option for seller if s/he wants to get a special service. I expect you do not know what it means.
Click to expand...

As a professional investor for the best part of a decade, I have actually found out what the difference is between exclusive and non-exclusive agencies. The original poster asked for 'as much market coverage as I can'. I made him aware of non-exclusivity as an option as from an Irish point of view, this is not the norm.

I don't think we're necessarily in disagreement though. I agree that good apartments sell themselves on the local market, but local agencies and private sellers generally don't have good connections to the international marketplace, which can usually generate more interest, particularly if the apartment is not in the under-20M HUF price range.
 
seánieboy said:
i see the currency today is 246 forints to the Euro ...
Click to expand...

The forint is a a perfect toy for traders. I've really given up to analyze the market details and guess what will happen next.
But I believe that even with a 10%-15% increase due to currency fluctuation (since October '06), it's worth to invest in Budapest.
 
Urbandev and Seán,

If I remember well 270HUF/Euro exchange rate was expected by you in November 2006. I told you that your expectation is based on not relevant information. If necessary I repeat it again in public way:

- Hungarian florint is undervalude due to some economic reason
- comparing to other CEE countries' currencies HUF is very very week
- current band (240-320) is an artificial brand controlled by The National Bank
- if there was no band, HUF would be much stronger than 240

Those who do not know what the real story with HUF, Hungary is too dangerous to invest in Euro based apartments!

All neigbour countries including Serbia and Croatia have stronger currency than HUF. It is not normal and market would set the balance.

However, free floating would have some serious consequences as well by which currency risk would be much higher than ever before.
 
Hello Pinchy,

Since here is a bad time to sell you would need a special way of selling the apartment. I mean apartment is similar to a product. If you want to sell it you should look after segmentation, targeting and positioning. You cannot do it alone so you need a professional assistance through estate agency and or investment consultant. The company would help you find out the followings:

- do research and valuation
- where to advertise
- how to advertise
- time component

Comprehensive evaluation help you to understand your current positon and financial potentials in a time frame. Further, running out of Budapest has a message to new buyers. If you want to sell it to a foreign buyer, I do not think s/he would be happy to go with you without getting relevant information about business potentials:

- sell it with or without tenant
- why to sell now
- etc.

I still think setting up an investment strategy for buyers and sellers is to be done before doing anything. In this case, finding one or 2 partners would be enough instead of working with several agencies without knowing anything about market potentials.
 
Hungary said:
Urbandev and Seán,

If I remember well 270HUF/Euro exchange rate was expected by you in November 2006.
Click to expand...

:rolleyes: Worse. When the Huf/Euro was around 277 at the time of the October riots, I put a trap on 280HUF/Euro to change quite some money for future investments.
How wrong could I be? The forint never reached that point & since then it was all the way down.

PS> Hungary, sorry I didn't call you back to meet-up last time => things were really hectic those days. In one week (March 30) I'll be living in Budapest & I invite you over from the moment all my stuff is in place. See you soon!
 
Currency prediction is basically futile in my opinion. Last week, there were a lot of media reports about getting rid of the trading band after Slovakia revalued its currency. However, reports over the last day or two suggest that this seems less likely.
http://www.portfolio.hu/en/cikkek.tdp?k=2&i=11366
http://www.portfolio.hu/en/cikkek.tdp?k=3&i=11357

For what it's worth, most local economists I've spoken to on the issue, including one who I personally employ from time to time, suggest that at the minute, the HUF is neutral/artificially overvalued due to expectation of trading band removal.
 
Hello UrbanDev,

I wanted to say that you expected weaker HUF for 2007 in 2006. In November 2006 I said to you that HUF will be as strong as 250 soon in 2007. But you expect as weaker HUF as 270-280 in 2007. It does not mean it will not be weaker during the year but 250-260 is more likely than 270-280 in 2007.

I let you know that 260 was in 1 November and 255 in 1 December.

Nevermind:)
 
it seem to be too difficult to predict the currency rate, however since Hungary will only join the euro zone to wards 2010-2012 it does not seem too reasonable that the government of the national bank will support the huf until late 2008 or 2009. today the prediction is (as accurate as it can be) is that the huf will stay around the 250 +/- 2-3% . if one will track option on the euro / ft in the currency market this is the conclusion that can be reached.

pinchy. the best thing for you to do is to give exclusivity to agent like Duna house for a limited period of time (2-3 months) if you do that they will give you a discount on the commission and since it is limited in time , if they don't succeed you can replace them.
 
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