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Q&A: Gearing up to buy a Florida home
By Hannah Ricci
Reader's query
I've been considering purchasing a property in Florida for some years now having made a trip out there to look at property in 2003. But the time has never been quite right, due to commitments at home and the rapidly rising cost of property in Florida over the last few years.
Now, with the pound so strong against the dollar and the US property market in decline, it seems the right moment to make a move. Although, if the property market has a further price re-adjustment to make and prices fall further, it's probably worth biding my time before committing to a purchase. It would seem prudent, however, to take advantage of the dollar/sterling exchange rate at present and be prepared for the right moment to make the purchase.
What's the best method of securing the dollar rate? Would it be advisable to convert sterling to dollars now and hold the funds in a US-based dollar account or in a foreign currency account based in the UK?
TM/Dorset
Expert's advice
Matt Pitcher
Wealth Adviser at Towry Law in Bracknell. He advises on financial planning
Timing the currency and foreign residential property markets is hard to get right. You need to decide on the cost you're willing to pay to secure these options. It would be wise to decide on a currency level and property price level you're happy with, and then move when each asset reaches the point you have set.
You're right to say that the dollar/sterling exchange rate is at historically very good levels and that this may not continue. If you're sure that you want to put off buying in Florida, then you should consider alternatives to the bank accounts solution you mention, which is likely to be expensive.
A better way of completing this transaction might be to secure the dollar at current rates and then wait to buy at a time you think is opportune. To do this you will need a specialist currency trader such as HiFX (hifx.co.uk). One of the benefits of using a trader is that their costs are likely to be lower than a bank's. You will have to do some further research and spend some time tracking price movements.
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