New Year New Home?
That’s another Christmas done and dusted. Your weight in turkey eaten; presents bought, wrapped, unwrapped (and in some cases taken back to the shops); dodgy Christmas TV watched. Ever think you’d like to do it differently one year? Maybe this year? Well, with the currency markets as they are now, you might be tempted.
Because as we welcome in a new year, it’s with the news that GBPEUR recently moved to its highest level since 2008.
For those who have made it their new year’s resolution to move abroad, sterling strength against the euro is in their favour and will mean their money will go further when buying property abroad. It’s also good news for those that have moved overseas and are getting their pension paid into their euro account every month or for those that are sending money to pay for university fees or student living expenses.
At the start of this month, GBPEUR was at 1.2824; it had been down at 1.2570 just two week’s previous to that – on the 17th December. The rate also fell below 1.25 in August, September and November.
At the time of writing, the GBPEUR exchange rate of 1.2768 means that when making a £250,000 transfer, you’d get €319,200. Less than three weeks ago, the same amount would be worth $314,250. That’s a difference of around €5,000 in the space of a matter of weeks – what a difference that could make when it comes to getting the home of your dreams.
Rewind a year, and the exchange rates then would have meant you’d have got around €302,050 for your £250,000 – around €17,000 less than you’d get today.
So it’s looking like a decent time to move abroad. But the question is, where does your money go the furthest? Well, 2014 saw many European countries’ housing sectors show strong growth, particularly Ireland (up 14.5% in the year up to Q3 2014) and Estonia (up 15.3% in the same period). Turkey also performed well – up 7.5% in the year to Q3 2014 – as did the Netherlands, Czech Republic and Lithuania, all increasing by about 4% on the same period, according to the Global Property Guide.
But what about the places that haven’t seen so much growth in their countries housing sectors – this is where your money will go further. In Spain, house prices went up by 0.8% in the year up to Q3 2014, and in France, actually fell 1.1% in the same period.
While not great news for those trying to sell a property in France and Spain, it’s a real tempter for those who are thinking of buying in those countries – popular with expats – in 2014. All of this while average house prices in the UK are 8.3% higher than a year ago; in London, prices are rising faster than anywhere else.
Together with favourable GBPEUR exchange rates, it may be time to let that new year’s resolution come to fruition – for once.
Article written by Simon Hilton Senior dealer at World First Foreign Exchange