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If you're planning to buy a property in Malta, it may please you to know that the pound recently came close to a 16-month high against the euro, making Malta property cheaper. Last week, sterling reached 1.2205 versus the common currency, close to its highest since January 10th 2013.
By contrast, the pound was as low as 1.1371 in March last year. This means, were you to transfer £125,000 to Malta to buy a property, today you'd receive €10,688 more today than last March. Clearly, this makes Malta property more affordable for you.
Sterling has climbed, because the UK economy has surged in the last year. For instance, the UK economy grew +3.1% between January and March, the most since 2007. Moreover, the UK is creating +100,000 new jobs a month, according to Markit, the most since 1998. So this has lifted the pound!
Will the pound continue to climb against the euro, further cutting the cost of Malta property? It might just. This is because, with the UK economy resurgent, the Bank of England is likely to become the first major central bank to raise interest rates since the financial crash. This will send a strong signal that the UK economy has bounced back, and so boost sterling.
Meanwhile, if you'd like to take advantage of the resurgent pound when you buy a Malta property, there are two things you can do. First, compare the exchange rate your bank offers you with that from a foreign exchange specialist. This is because a specialist will give you an exchange rate up to 4% better, adding thousands to your euro total.
Second, if you like the current exchange rate, but don't yet wish to transfer your money to Malta, you can set up what's called a forward contract. This lets you "lock in" the exchange rate where it is, so you can transfer your money any time you like in the next two years at that exchange rate. Hence, you're guaranteed the good exchange rate.
So in brief, 2014 is shaping up to be a great time to buy a property in Malta!
Thanks to author, Peter Lavelle, for this very interesting article!
08 May 2014