The eastern promise of that second home may not be such a bargain

Owning a second home is one of our most popular fantasies. Unfortunately, it is usually punctured on holiday by somebody who has already taken the plunge. "You should have been here three years ago. You could have had your pick of old farmhouses for under £5,000." But, maybe a new collection of destinations for bargain house-hunters is about to open up.

On 1 May, 10 more countries will join the European Union. Two, Malta and Cyprus, are long-time favourites for holidaying Brits or those looking for a place to retire in the sun. The others, Hungary, Poland, the Czech Republic, Slovakia, Slovenia, Latvia, Estonia and Lithuania, are less familiar, having emerged from behind the Iron Curtain only at the end of the 1990s. In fact, although estate agents report a flurry of interest, accession to the EU will have little immediate impact on the legal process of buying a property in the 10 states.

Also, despite popular misconceptions, none will be joining the euro for years. That means there is no urgent rush to buy to beat the sort of surge in property prices that accompanied the entry of Spain and Portugal entry to the eurozone.

Although national laws may remain unchanged, EU membership does have an important impact on property ownership says Charles Weston-Baker, director of the international residential department of estate agents FPD Savills.

"It underpins and secures the investment because people have rights under European Union law. Buying a second home involves big sums of money. We've seen a lot of interest in the lower end of the market about the £60,000 to £100,000 mark. What people are looking for are bargains."

The change is that these buyers are not searching for property in places where they have been on holiday. "With these new places, there isn't a great pool of knowledge from holidays," he says. "There are bargains, but there's a lot of learning to be done as well."

As ever, location is key. "What you can get for your money depends hugely on where it is," he adds. One of the main considerations is how to get to that dream home on the coast or by the ski slopes. Much of Spain, Portugal and Italy can be reached quickly and cheaply on a budget airline. It makes snatching a few days or a weekend away a real possibility. The same cannot be said of all the new destinations, although the situation is improving.

There are already regular cheap flights from the UK to Prague with easyJet and Czech Airlines, which also flies to the Baltic states. EasyJet has also announced it will start a regular service to Budapest in Hungary and Slovenia's capital, Ljubjana, starting in May.

Cyprus, and to a lesser extent Malta, are accessible fairly easily by charter flights, and Warsaw is large enough to command regular air links. Bratislava, capital of the Slovak Republic, is the same distance from Vienna airport as Vienna itself and will benefit from the removal of border restrictions.

But before buying a property do bear in mind that airlines vary their routes often at short notice, and there is no guarantee they will continue forever. And do remember the road infrastructure in many of these countries is poor. A holiday home seems less attractive if getting there is best achieved by a small military vehicle with four-heel drive or, preferably, tank tracks.

That is one of the elements that makes Cyprus attractive. The roads are excellent and, to the relief of many retired Brits, they drive on the left. Property prices are still better value than in Spain. A two-bedroom flat in desirable place such as Paphos would set you back £80,000 and a small villa with a swimming pool in the same area costs little more than £200,000. In a less expensive place, such as Limassol, the prices are 30 per cent cheaper.

"We've seen a lot of interest recently and that does seem to be to do with Cyprus going into the EU," Pauline Gallagher of developer Halcyon Properties, says. "There's also been a change in the sort of people we're getting. It used to be mainly those looking for a place to retire or buy a holiday home. They're still coming, but we're also getting younger people who hope to be able to work from Cyprus after May."

This may turn out to be a trend, with work, rather than retirement and holidays, driving prices in some of these property markets. It is already happening in Prague. For more than a decade after 1989's "Velvet Revolution", rents for refurbished luxury flats in the city centre matched or surpassed western European levels. Expats, or their companies, paid more than £4,000 a month.

In 2000, that market slumped partly because of the collapse of the dotcom boom, but also because an increasing number of senior jobs which had been held by foreigners were taken over by Czechs.

Most people in the ancient Czech capital live in flats with regulated rents, often less than £40 a month regardless of location. At that price it is hardly worth applying for a mortgage even if one is available. But although commercial rents may not have recovered to the dizzy levels they reached a few years ago, property prices have continued to rise which is attracting investors.

Last month, the London-based property investment company Letterstone took just a week to sell all the units in a luxury block of flats in Prague. "If you have money to invest, the risk to reward in areas like Prague is enormous," says a Letterstone investor, Tim Johnston, an estate agent at Winkworth's Knightsbridge branch.

"The attraction is the sort of capital gain you can achieve; for a small outlay of, say, £60,000 to £90,000 there is huge potential. And investors have to pay only a deposit until completion in two years, giving them a free ride on the property market."

Letterstone is looking at further new-build opportunities in Croatia and another one of the EU accession countries, the Slovak Republic. Last year prices for flats there rose by an average of 30 per cent. This was largely driven by a housing shortage which is common to many of the former Soviet Bloc countries.

There are only 310 dwellings per 1,000 Slovak residents, compared to an EU average of 450 per 1,000. The situation is not going to get easier. The Slovak Statistical Office forecasts there will be an annual increase of only 1.2 dwellings per 1,000 over the next few years. Again, this is lower than most EC countries.

The effect of this shortage on prices has been felt most acutely in the cities and their suburbs. In the Latvian capital of Riga, for instance, the estate agent, Ober-Haus, says prices on the outskirts rose by 30 to 40 per cent last year, and in the centre the increase was 7 to 15 per cent.

But generally, the prices for property in the countryside are much lower to start with and are also rising more slowly. Unfortunately for those hoping to create a new Provence in Poland, the conditions are distinctly primitive, with poor roads and often no electricity or phone lines.

"Wherever you go there's no such thing as a sure bargain," Charles Weston-Baker says. "But there are plenty of places that offer terrific value and the time to buy is now because the prices will creep up."

'I like low crime rate, and sun'

Patsy Richards moved to Cyprus last year with her six dogs, all named after former Manchester United players.

She had been a television producer in Manchester preparing for the Commonwealth Games and wanted to move after the contract ended.

"I knew Cyprus because I lived here while I was working as a production manager for a Middle Eastern satellite broadcaster.

"I like everything about it, the weather, the low crime rate, the international community and the way I can get to places such as Cairo or Beirut in an hour or so. A lot of my friends think I'm mad going to those places, but it means I don't get island fever."

"Cyprus coming into the EU was an added attraction because it means, hopefully, I'll be able to do part-time work.

"That's partly why I chose to live in Limassol rather than Paphos, because Limassol is a real working place, although it does have a beach. And I will work only part-time, because I've got plenty to do with my pets."

FACT FILE: PROPERTY IN THE NEW EU MEMBERS

* CYPRUS

Popular with holidaymakers and homebuyers. Two-bedroom holiday flats cost from £50,000

* MALTA

Climate and tax breaks attract retirees. A new two-bedroom apartment close to the beach costs £70,000.

* CZECH REPUBLIC

Foreigners cannot own property directly so a company must be set up for the purpose. Prague is expensive, with many luxury flats costing upwards of £200,000.

* SLOVAK REPUBLIC

There are bargains. A two-bedroom flat in the Tatra National Park is for sale at just more than £30,000, through www.tatry.net.

* POLAND

Best buys are in the countryside, for instance, www.viviun.com has an unrestored granary in the forest near Poznan for less than £18,000.

* LITHUANIA, LATVIA AND ESTONIA

Their lakes and forests are attractive and property still appears inexpensive, with three-bedroom flats in the capitals for £20,000. A large, modern house in the Estonian countryside is on offer at £100,000 from www.ober-haus.ee

* HUNGARY

A luxury villa with pond and 18.75 acres is for sale at realestate.escapeartist.com for about £200,000.

* SLOVENIA

About £76,000 will buy a small vineyard and a three-bedroom house from www.euroburolimited.co.uk