A weaker Euro means less pounds for British vendors who repatriate their funds to the UK

January 25, 2012 – 1:25 pm

The weaker euro v the pound affecting property vendors in Tenerife and Spain

In the Euro zone , we continue to see the  single currency’s woes. For many investors and property owners in Spain it’s time to look at the bigger picture, which doesn’t paint a pretty scene as the hang-over continues into 2012.

The second half of last year revealed a number of detrimental factors that have hurt the Euro zone – a worrying decline in stocks, increase in unemployment, Governments finally pulling their heads out of the sand and recognising the problems within their own countries have all contributed to the crisis, which left people asking whether the single currency will even survive a year. It is a fair assumption that the Euro zone debt crisis will remain the central focus of markets going well into the New Year, so further weakening of the Euro is expected.

The outcome of the EU Summit last month did little to support the currency, with the outlining of plans to work towards greater fiscal integration in the euro zone failing to provide any comfort to the market as GBP-EUR pushed the €1.20 (0.833) level, and some forecasting €1.25 (0.8) by the end of February.

So the Euro could well continue to fall, in which case now might be a good time to sell it, or get a forward contract to do so if you are not yet ready (for example, if you are in the process of selling a property in Spain).

For example, if you wanted to change Euros into Pounds in June last year, when one Pound cost 1.11 Euros, but you didn’t have access to the Euros until December, a foward contract could have saved you £6,992.21. Firstly, you agree a rate of exchange for the amount of Euros that you are looking to sell and give a date that you know that the funds will be available before (bond maturity, or date of expected house completion for example).

A 10% deposit is needed within a few days of agreeing the rate and you can then relax and not be affected by any market movement, and can get your money at any stage at the fixed rate and all you need to do is send over the Euros when you have them before the end of forward contract.

By Angela | Posted in Economy, General, Health, Holiday, Inspirational, Miscellaneous Articles, Property, Tenerife, Things to Do | Tagged , , , , , , , , , , , , , , , , , | Comments (0)

Tourists returning to Tenerife

June 28, 2010 – 6:24 pm
Tourists return to Tenerife as the pound increases in value against the Euro

Tourists return to Tenerife as the pound increases in value against the Euro

British tourists are being wooed back to the Continent with more for their money. As sterling rose this week against the euro to its highest level since December 2008, giving British travellers up to 10 per cent more for their money than last summer.

“Holidaymakers can now expect to get more for their pounds travelling to one of the Eurozone countries than anywhere else,” said Sarah Munro, head of travel money at the Post Office.

Given the continuing concern over the future of the euro, the pound could strengthen further, while reports suggest that hotels and restaurants on the Continent are attempting to attract holidaymakers by reducing prices.

“Our research also shows that prices have plummeted in some of the most popular resorts – especially in Spain and Portugal, where restaurants have slashed their prices,” Ms Munro said.

The total average cost of several holiday essentials, including drinks, sun cream and a meal in a local restaurant, has fallen by 42 per cent in the Algarve, for example, and by 40 per cent in Spain, according to the Post Office. Similar research released this week by Thomas Cook also suggested that mainland Spain offers particularly good value for visitors from Britain.

“Exchange rates have a huge impact on where Britons choose to travel,” said Francis Tuke, a spokeswoman for Abta, the travel association. “The weakening of the euro will undoubtedly encourage us to return to the Eurozone.”

She added that hotel prices had fallen in Spain during the past year and that travel companies expected rates to fall in Greece.

Cheapflights.co.uk, the price-comparison website, has reported that searches for flights to Eurozone destinations increased by 6 per cent during May compared with the same month last year.

By Angela | Posted in Economy, General, Health, Holiday, Inspirational, Miscellaneous Articles, Property, Tenerife, Things to Do, Weather | Tagged , , , , , , , , , , , | Comments (0)