Buy or Sell?  The conundrum for Foreign Property Investors in the U.S.A.

 

The following informative article was recently written by a dear friend of mine, David Nixon-Business Development Executive at Currencies Direct.

When you buy an investment property in the US you’re probably motivated by a number of reasons.

Perhaps you want a destination for family vacations, maybe it gives you an additional income from rentals and – of course – there’s always the likelihood of your property increasing in value.

Buying a property in the US is, in effect, an investment in the US economy. That’s why Wednesday’s Federal Reserve announcement of the first interest rate rise since the birth of the iPhone is not necessarily a bad thing.

With economies all over the world in turmoil, the US dollar continues to be a safe haven. The decision to raise rates was data dependent, and that data has been positive enough to bring about this change: Compare that to the Europe, Canada, Brazil or China where troubles in the respective economies have been well reported.

If you want to buy an investment home in the US, it means you should be keeping a close eye on not just the fluctuating property prices, but also on the strength of the US dollar. The US economy has gone from strength to strength over the last 18 months, especially when compared to the countries of some other major currencies.

Take this example:

In the last 18 months, property prices in the vacation property haven of Polk County in Florida have gone up 8.6%. For a realtor this is an excellent selling point to attract new international clients.

It means that a property bought in June 2014 for $200,000 is now worth around $217,200. Typically, expectations are that property values will continue to rise steadily.

The currency rates are far more volatile. They can go in your favor or just as easily move against you. Look at the difference of major currencies in the same time frame (June 2014 – November 2015):

Great British Pound Sterling

US$200,000 in June 2014 was worth around £117,647. Today, it’s worth about £133,333 – an increase of 12%.

Canadian dollar

US$200,000 in June 2014 was worth in the region CA$216,000. Today, it’s worth approximately CA$268,000 – an increase of 20%.

Euro

US$200,000 in June 2014 was worth roughly €146,000. Today, it’s worth around €188,000 – an increase of 22%.

Brazilian real

$200,000 in June 2014 was worth somewhere around R$440,000. Today, it’s worth about R$830,000 – an increase of 53%.

This data could be great for those realtors who want to attract listings, and could also be an indicator to those of you who are foreign property investors that now is an excellent time to sell.

However the same data, coupled with continued uncertainty in the rest of the world, may also be a persuasive argument for now being the right time to invest in a property in the US.

David Nixon

david.n@currenciesdirect.com

Advertisements

Annalisa Weller, Realtor®, Certified International Property Specialist

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

Join 358 other followers

List of Categories

Monthly archive of my posts

RSS PROView-Pinellas Realtor Organization

  • PRO Supports Damon Lister for Safety Harbor City Commission February 19, 2018
    On Saturday, February 17th, grassroots volunteers canvassed Safety Harbor in support of Damon Lister, candidate for Safety Harbor City Commission. Lister is a REALTOR with Park Property Group and is endorsed by the Pinellas REALTOR Organization and supported by PRO’s REALTOR Political Action Committee. PRO’s Public Policy Committee identifies and evaluates p […]
    PROView
  • ‘Welcome’ to all our new members who joined us in January February 16, 2018
    The Pinellas REALTOR® Organization would like to welcome all of our new REALTORS® who joined us in January! We are happy to have you as a part of our organization and wish you much success in your careers. All County Advanced Prop Mgmt Carolyn R. Peterson Aware Realty Inc. Herbert Vargas Azimuth Realty Group LLC […]
    PROView
  • Four Changes to Forms Effective Feb 20 February 16, 2018
    ORLANDO, Fla. – Feb. 14, 2018 – The following form changes were approved at Florida Realtors Mid-Winter meetings in January, and they’re scheduled to be released on Feb. 20, 2018, in Form Simplicity and via Florida Realtors other licensed vendors. For more information about Florida Realtors forms, visit “Tools and Support” on the website. Breakdown of the [… […]
    PROView
  • Homesnap Pro is MLS On the Go! February 15, 2018
      My Florida Regional MLS (MFRMLS) is now providing Homesnap Pro – one of the best and most powerful real estate tools around – to you as a subscription benefit! Confirm your Homesnap Pro account and see what a difference it will make for you! Here are just a few things you can do with […]
    PROView
  • Florida Realtors Chief Economist at PRO Feb 16 February 6, 2018
    The PRO Pinellas International Council (PIC) presents Florida Realtors Chief Economist at their “A Step Above Your Competition” event on Friday, February 16.  Do you want to be a step above your competition? Then join us to learn new and important data that will help you do just that. This informative program is designed to […]
    PROView

Visit Me at Active Rain

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: