Upshift of interest in European real estate
By Roxanne James

American Buyers Flood Europe's Property Markets

The dollar has been on a meteoric against major currencies since the middle of 2014 and is considered to have considerable momentum to carry the world's trading currency to even higher levels.

Hardly surprising then is the significant upshift of interest in European real estate from US buyers seeking to capitalise on dollar strength.

Real estate specialist at USForex, Jason Kumpf said: "The US dollar is still strong and the economy is good and the rest of the world is a little softer. It's a great time to increase your pieces on the international Monopoly board".

Most major European property markets remain heavily discounted to peak 2007 levels with prices falling more than 50% in certain countries. With the dollar riding high, real estate in Europe is looking as cheap as its going to get. As the US economic recovery continues, there's set to be a veritable invasion of American buyers for the rest of 2015 at least.

Currency fluctuations have a huge influence on overseas investment and increasingly in less liquid markets like real estate. The world's prime property markets have seen real estate being bought and sold to capitalise on FOREX opportunities, particularly since the rouble crashed towards the end of 2014. Buyers of UK property assets from the Eurozone are also selling up, seeking to take advantage of sterling strength.

The weakness of one currency to another can make a huge difference. For example, a €500,000 home would have cost around $683,000 last July. Now, the same property would have a price tag of $558,000, representing a 19% discount in less than a year!

France, Spain, Italy and Germany have been identified has having the most appealing property for US buyers. Spain and Italy look particularly attractive because of their slower economic recovery presenting more heavily discounted opportunities.

There has never been this degree of buying interest coming from American investors, making the uptick in sentiment extremely visible. US buyers generally look for bargains at the high-end of the market, particularly properties in luxury resort areas. Barcelona and the Costa del Sol are two areas of US investor interest, attracted by low property prices and Spain's booming tourist market in those regions.

 

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