Ian McSweeney borrowed €160,000 to buy an apartment in Budapest and a house in Florida - because he couldn't afford to buy a home at home. Kate McMorrow reports.

Why limit yourself to Ireland when looking for a first-time buy, when under €100,000 will buy a decent apartment in many European countries?

Cash-strapped and unable to afford a starter home in Dublin, 30-year-old pub manager Ian McSweeney borrowed €160,000 from the Bank of Scotland with his parents as guarantors, and set off to Budapest in search of an affordable first property.

After three visits and a few false starts with "pushy" local agents, Young's helped him find a renovated apartment on Andrassy Boulevard for €85,000.

It was owned by an architect and had an established tenant, which was a great selling point. With €60,000 left over, Ian flew to Florida to see what he could buy with the small change.

He found a new gated community under construction in Orlando (CHECK) 10 minutes from Disneyworld (CHECK), owned by a travel company and with a ready supply of holiday tenants.

"A US bank lent me $240,000 on the basis of my €60,000 and I bought a four-bedroom townhouse for $292,000 last February. The same houses are now selling for $469,000.

"I was cautious, went over there a few times and saw lawyers, although I was advised I didn't need to. I'm optimistic that all the properties will pay their way."

With the Budapest apartment covering the mortgage, Ian has put a deposit on another Hungarian investment, this time an apartment selling from plans with stage payments.

He still lives in his rented apartment in Castleknock and expects to buy something in Dublin "one day".

"I'll actually be in profit next year when the rents in Budapest go up. The most I could borrow as a first-time buyer was €160,000 and you can't get anything at home for that.

"It took courage but it paid off. In two years' time, I'll cash in my SSIAs, release equity in the Florida house, then perhaps buy here."

Most young Irish property entrepreneurs release equity in their existing Irish house to fund an investment abroad.

Last September, Cliona Judge and Eoin Lyons bought a one-bedroom apartment in the prestigious District V in Budapest. Although still in their early thirties, this was their sixth buy using equity to fund borrowings.

"We're building up a pension fund and they're all appreciating hugely. Rents are covering the mortgage and more, " says Cliona.

Their Hungarian apartment is in a period building earmarked for refurbishment by the local authority. With glimpses of the Danube and a great location near the opera house, the apartment was a bargain at €111,000, says Cliona.

"It happened so fast. We had decided to combine a holiday in Budapest with having a look. After one day of intensive viewing with Young's, we had seen eight or nine buildings, old and new. Day two, we went back and decided on the district.

"Foreign investors pay a premium and there was no real negotiation - we got the deal signed in two days.

"We knew we were gambling with our €2,000 non-refundable deposit but happy we had a good agent.

"We found that each area has its own council and some have a better reputation for upgrading buildings than others. So look for old buildings on the list for restoration.

"They clean the facades, upgrade inside communal areas and fix lifts. Money will be pumped into areas that are photographed regularly, like the buildings around the Opera.

"Blocks outside the city centre selling from plans are absolutely superb, but you won't get value from something with such a top spec - there's not so much capital gain.

"Agents will always inflate the amount of rent you'll get. We were told €550 a month but we're getting €400. Just now it won't cover the mortgage but our view is not short-term.

"The apartment is worth €140,000 now and it will go up when Hungarians can take out EU mortgages.

"We're looking at Cracow and Shanghai, they're definitely good places to buy," adds Cliona.

Warsaw has become the latest hot place to invest.

With AIB established in Poland and offering mortgage packages of up to 70 per cent, interest is growing by the week.

When Sean McEnroe from Dunshaughlin heard that friends were buying apartments in Warsaw, he decided to join them.

He already owns a second house in Dunshaughlin and couldn't find tenants, because of the oversupply of property to let in the area.

Sean put €10,000 down on a one-bedroom unit in an apartment complex in the best location in central Warsaw.

The full price was €120,000, which doesn't include fittings like kitchens, wardrobes or flooring.

A car-park space cost another €15,000 to €20,000.

He bought sight unseen which is not recommended, but "knew people who knew" the agent, Irishman Conall McGuire of Warsaw Properties.

It ended well however and Sean was delighted with the apartment when he flew out to view the finished scheme last November.

"You can buy in Warsaw for about €50,000, but not in a good area and rents are not good," says Seán.

"The apartment next door to mine is already rented for €900 a month, so I should get the same if I spend around €25,000 on the fit-out.

"Management fees cost around €250 a month and include central heating, which isn't bad.

"I have to keep it for five years to avoid capital gains tax, but I probably won't sell it then.

"I'm very happy with the apartment and the finish is very good, even though it is a bare shell. "