Irish property money continues to go East

IRISH investors are continuing to plough tens of millions of euro into Eastern European states.

Despite the collapse of a scheme in Bulgaria, where Irish investors lost at least €12 million, property speculators are still targeting new EU members and candidate states.

It emerged yesterday that Irish investors, in the first six months of this year, bought more than half of the apartments purchased in Budapest by foreigners.

The Hungarian administration office (BFKH) revealed 416 of the 814 flats sold to overseas buyers were snapped up by Irish.

German investors were next, purchasing 74 apartments, and were followed by 57 British investors.

The Hungarian authorities believe Irish investors, encouraged by the proceeds of our domestic housing market bonanza, started to acquire apartments in central Budapest early this year in anticipation of significant gains in the new EU state.

However, the attractiveness of property market in neighbouring Bulgaria - which is not an EU member - nose-dived after the assets of a Dutch company NV Capital Ground and Building Investment were frozen in Holland.

Almost 400 Irish people invested between €12 million and €15 million in the planned five-star resort on the Black Sea coast before the company’s collapse. Many investors are likely to suffer substantial losses.

Platinum Developments was one of a number of Irish agencies which sold many of the properties to investors. The Rathmines-based company has commissioned KPMG to carry out an audit to determine if the Pomorie project can be completed.

An international watchdog for the overseas property industry is currently examining whether Irish estate agents vetted the Dutch developer Peter Kuyper who was behind the controversial Bulgarian scheme.