By: VIKKI HILL
Vikki Hill is the Head of Operations for Foreign Currency Exchange in the Algarve, providing advice to UK and European expatriates in Portugal.
SECOND HOME owners are taking advantage of currency exchange movements to sell up while the Euro is strong.
There’s no denying that the current financial climate in the UK is giving both businesses and private investors cause for concern. In the past, currency exchange rates meant that the euro was weaker than sterling, but recent events have strengthened the currency used by many European countries. This has spurred many UK investors to take another look at the overseas property they hold and, in many cases, to sell while profits are there.
Homeowners take advantage of currency exchange
For those who own one or more properties abroad as well as property in the UK, the credit crunch and general economic slowdown is a worry. Many banks that have previously been happy to lend money for overseas property are now cutting back on the amount they are willing to lend, asking for higher deposits or refusing to lend altogether.
In some countries where many new homes are bought by non-residents, this slowdown in lending is bound to affect prices, meaning you could get less for your holiday home if you choose to sell it later on. Instead, many homeowners are choosing to sell up completely, realising a higher euro value for their property, or are taking out a remortgage on their overseas property and using currency exchange to convert that money to sterling. This gives them the benefit of a cash surplus in sterling which may help them ride out the credit crunch in the UK.
Other investors are converting their euros into dollars, which is offering a high currency exchange rate at present. These buyers may then take advantage of collapsing prices in the US to buy property for cash that could increase in value over the long term.
Getting the right currency exchange advice
If you own property overseas and you’re thinking of selling or re-mortgaging to take advantage of present currency exchange rates, talk to a foreign currency expert first. Not only can they help you decide what to do and when, they can organise converting your currency and helping you get the best currency exchange rate when you need it.
For further information, contact the Portugal branch of the Foreign Currency Exchange on 914 338 799, email: [email protected] or call their UK Head Office on +44 (0) 20 7989 0000.