Time to take advantage of a strong pound versus euro?
In the first month of 2015, we’ve seen the rise and rise of the pound against the euro, with GBPEUR hitting its highest level since March 2008. At the start of February, the rate was at 1.334; at the start of January it was down at 1.2824. In just a month, the euro has lost over 4% against the pound.
But why? Well, part of the reason is that while the European economy continues to grapple with extreme levels of unemployment and fears over deflation, the UK economy had become one of the fastest growing in the G10. Euro uncertainty around the Greek election, and fears of a possible Greek exit from the single currency hardly helped matters either.
Here’s what all of this actually means to you – a year ago, a pound bought you €1.20. At the time of writing, it’ll buy you €1.37 – that’s an increase of 12% and the highest it’s been in over 10 years.
When we talk about the sums involved in buying a property overseas, the savings you could make when you compare the exchange rates of now with those from a year ago could make your eyes light up. Last year £300,000 would buy you a €360,000; now you could buy something worth €51,000 more.
Anyone looking to buy property in Europe would be advised to think about fixing their exchange rate now to take advantage of the pound’s strength against the euro.
This is really useful if you’re planning to set up a purchase but are worried that the exchange rate may move against you. So by fixing a rate now, you won’t be affected if the value of sterling falls between now and the time the payment goes through.
As we’ve seen, the euro has been through a tough spell, enduring a rocky start to 2015. It could continue to be a volatile year, with elections aplenty in the EU – Estonia, Malta, Finland, the UK, Poland, Denmark, Portugal and finally in Spain. Throw in a Catalan referendum on independence and we have the makings for some serious ballot box driven volatility in the coming months. And that could mean more good news for British investors buying property in Europe.
World First specialises in assisting private and corporate clients with foreign exchange transactions. World First transacted circa £6billion for their clients in 2013. Winner of the Client Focus Award at the 2012 National Business Awards and the Client Focus Award at the 2014 European Business Awards, each customer gets a dedicated consultant and all phone calls are answered within three rings.
If you’d like more to know more on currency transfers click here to ask Sarah at World First for more information.