While sales and prices fall, bargains are to be found in the Hungarian capital of Budapest.
On average, the value of property in the city has fallen by around 30 per cent over the past five years, including a 5 per cent drop in 2011, according to Bánlaki. An increase in the number of distressed properties coming on to the market in the last quarter of 2011 may push values even lower.
This is bad news for speculative investors, mainly from the UK, Israel, Spain and Ireland, who flocked to Hungary in the middle of the last decade. Most of them bought flats in Pest, the commercial heart of the city on the left bank of the Danube. Buda, on the right bank, tends to attract expat families.
Some of those who bought property before the crash, particularly at the lower end of the market, have had a rough ride. Typically, the rental income from these properties was never high or reliable enough to cover mortgage costs. Many investors cut their losses and sold up; some buildings in the charming Jewish district, which was a target of speculative investment, appear unfinished – casualties of the wider recession as much as of the plunge in values.