2007’s property hotspots

FC Exchange predicts that in 2007, the best countries to invest in will be Bulgaria, Cyprus, Central Portugal, America and France, but buyers should probably avoid Spain.

Nick Fullerton, Director from FC Exchange comments on why each market is set to do well in 2007: “We work with finance on a daily basis, which gives us an in depth knowledge of international markets. We have based our 2007 predictions on our industry expertise and experience of spotting and interpreting patterns and trends. The countries FC Exchange have cited as ‘hot spots’ are the ones where buyers are most likely to see good returns for their money. We have taken into consideration individual economies; the strength of each currency and the supply and demand that is already present in each market, which always affects prices and availability.

Bulgaria is attracting shrewd investors keen to take advantage of the current low prices, especially in comparison to the rest of Europe. FC Exchange has noticed an increase in the number of investors buying in Bulgaria and expects property prices to continue rising. The investment opportunities in Bulgaria are as a result of extensive World Bank funding, which has allowed dramatic improvements to Bulgaria's infrastructure and tourism industry, transforming it from its former Communist days.

The property market throughout Cyprus is one of the fastest growing in the European Union and prices in some areas are increasing by an annual average of 20%. It is an attractive country for foreign residents permanently residing there, because you only pay a 5% flat rate of income tax and property prices are still lower than in many other European countries, particularly in the north. Cyprus has a low cost of living, which often makes for an improved quality of life as well as a lot more sun than England. There is a comparatively low crime rate in Cyprus and friendly locals add to its desirability as a destination.

FC Exchange has seen the Portuguese market strengthen over the past few months. Central Portugal is increasing in demand, probably as a knock on effect from the declining Spanish market. The investment return in property in the country, due in part to an increase in demand and a lack of supply, but the beautiful beaches and an increase in low cost airlines are also a factor.

America is a great place to buy at the moment because the exchange rate is so good. A weak dollar (versus the pound) is advantageous, but buyers wanting to capitalise on the current beneficial market should probably buy a forward contract, something FC Exchange provides. Forward contracts allow buyers to lock themselves into an exchange rate for up to two years, therefore becoming immune to the volatile currency market. When buying a forward contract only ten per cent of the total amount is paid up front and the rest of the money is paid for in the future.

France has always been a top spot for UK buyers because of its geographical closeness. Prices in France are among the most competitive amongst the established European countries and bargain prices can still be found which have potential to appreciate, sometimes steeply in value.

However, Spain, which has been a favourite of British buyers for years, is rapidly losing its appeal as the new Spanish Government has begun investigations into bogus planning permissions. As a result a number of new build blocks are being ripped down with little or no compensation for the owners. FC Exchange has had experience of transferring money back for UK customers who have been stung by this new problem. A lot of owners are now trying to sell their property while it is still standing, which is proving more and more difficult as the demand for property decreases.”

FC Exchange highlights that when investing anywhere buyers should look out for small independent restaurants, cafes, shops and even estate agents in the local area. These all indicate the arrival of new and affluent locals, but they warn to be wary of large chain restaurants and stores as these normally indicate that an area has completed its boom period and the investment is unlikely to increase in value.

FC Exchange expects the number of people buying abroad to continue growing as more and more people are excluded from buying a property in the UK due to impossible house prices, rising interest rates, and mortgages that take buyers into negative equity as soon as they have signed the contract.

Buying abroad can be an expensive process. FC Exchange can achieve exchange rates that are not available to individuals shopping on the high-street and offers 'Forward Contracts', allowing individuals to buy currency at a fixed rate for up to two years. This type of contract is particularly effective when buying a new build and payments need to be staggered. To contact FC Exchange visit fcexchange.co.uk.