Planning to move stateside? Secure your currency funds now while dollar is at a low

As the dollar hits a fourteen year low against the pound, currency specialist HiFX is recommending that Brits who are planning to buy US property soon seek advice on how best to take advantage of the current favourable rate and consider buying currency now to fund their purchase.

Mark Bodega, Marketing Director from HiFX explains, “Due to interest rates pushing higher in the US from 1% in 2004 to 5.25% presently, the US dollar has weakened by 13% so far this year from 1.72 to 1.956 in anticipation that these higher rates will have a braking impact and slow the US economy, making buying in the US less expensive for Brits. There has been a lot in the news about the benefits of Christmas shopping stateside, but people looking to buy property in America, either as a permanent residence or a holiday home, should also look at financing their purchase now.

“Many of HiFX’s customers are taking advantage of locking into the very favourable rates we are seeing at the moment by use of forward contracts.”

In essence, a 'forward contract' means that you can buy the currency now (locking into a favourable rate), and pay for it later. To do this clients are required to pay a 10% deposit upfront and the 90% balance upon the maturity of the contract (up to two years into the future).

Bodega continues, “Most property purchases abroad take between 8 and 12 weeks to complete (and many months if the property is bought off plan) so people need to think about currency fluctuation between the time of signing the contract and the final payment actually being sent. Forward contracts are a great way for people looking to move to the US to take advantage of the favourable exchange rate.”

As with all major investments HiFX recommend that Brits do their homework before buying abroad.

Bodega concludes, “We always remind people that they would never agree to buy a property in the UK if they did not know how much it was going to cost them; if they agree to buy an overseas property without fixing the exchange rate at the outset, that's exactly the gamble they are taking.”