The pound at a 4 month low against the Euro

The pound has fallen to a 4 month low against the Euro because of fresh concerns about the extent of the UK's public sector debt levels.

One €uro rose to as high as 0.9057 pence in Friday trading, the single currency's highest trading position since May. The pound's falls came as official figures showed UK's public sector net borrowing totalled £16.1bn last month. The Government's overall debt now stands at £804.8bn, or 57.5% of GDP, which is an increase of £172bn in the past year.

Analysts advise that the £ was also weakened by speculation that the FSA has set Lloyds Banking Group the task of raising more than £20bn to strengthen it’s balance sheet if it wants to leave the Government Asset Protection Scheme (GAPS). Such news has hurt the £ as it suggests that it will take longer for the UK banking sector to return to normal.

So, having seen expectations of the £ trading at 1.20 or even 1.25 against the Euro for the year end, the picture has now been totally revised and experts are waiting to see how the currencies move during the final quarter of the year. We have seen highs of 1.2917 back in Oct 08 and lows of 1.0249 in Dec 08, highlighting the importance of using a specialist currency dealer when you move money between currencies. For a 250,000 € house, for a UK buyer, the price could have fluctuated between £243,925 and £193,545, a staggering thought.

Monthly average rates for 2009 highlight the progress made until June since when improvement has halted and fallen back towards levels experienced in April.

Monthly average rates 2009

January 1.08962 EUR (21 days average)

February 1.12765 EUR (20 days average)

March 1.08771 EUR (22 days average)

April 1.11409 EUR (21 days average)

May 1.13034 EUR (21 days average)

June 1.1674 EUR (22 days average)

July 1.16157 EUR (23 days average)

August 1.15938 EUR (21 days average)

September 1.13592 EUR (14 days average)

Peter Elias (Agent Commercial), La Moinerie, 79500 Paizay le Tort, Deux-Sèvres, FRANCE

Tel: 00 33 (0)5 49 27 01 22 or Tel: 00 33 (0)8 77 07 58 99 Mob: 00 33 (0)6 62 28 02 25

Tel: 0871 717 4176 (UK) Website www.allez-francais.com

Property exhibition time

This week, taking a break from work in rural Devon, I have taken the opportunity to visit the French Property News exhibition at Olympia, which is where we launched the Allez-Français company in January 2002.

How times have changed ! The vast halls of Olympia were packed with exhibitors over 2 floors back in 2002, and space was at a premium. During the course of that weekend 40,000 visitors charged through the doors and ensured that you never had a moment to relax. Yesterday, by contrast, there was plenty of space for exhibitors, over a single floor, and visitors strolled through the doors at a trickle rather than a surge.

There seemed to be as many Currency exchange dealers as Estate Agents, surely a sign that the immobilier world has taken a big hit and found times very hard during the past 12 months. There has been a change in marketing, away from costly shows, and expensive magazine advertising, towards more cost effective property website portals. That is certainly the way Allez-Français has moved during the last 12-18 months.

Being here in the UK does give you a serious reality check, however. PC madness still rules ! The newspapers yesterday reported how it is now not acceptable to refer to a famous pudding as “spotted dick”, and there was an article revealing that prison officers had been told that they could not refer to inmates by simply their surnames such as “Fletcher”, and that “Mr Fletcher” was the order of the day. What would Ronnie Barker say !

No wonder there is no shortage of Brits still trying to escape the island for France. The recent increase in activity is being maintained, and once again our company has been dealing with the signing of a “compromise de vente” on a Saturday afternoon. Well done Nigel, our new Agent Commercial, on notching up your 1st sale. Many more to follow ….

Peter Elias (Agent Commercial)
Website http://www.allez-francais.com/ or e-mail allez-francais@wanadoo.fr

Currency watch

Pound Euro rates faced a torrid week last week, falling on Friday for the 7th straight trading session, a first for 2009. Rates dropped after a raft of poor UK data showing the economy is still in decline, coupled with the fact that forecast interest rate differentials caused the Euro to strengthen. The rate picked up slightly in trading on Tuesday morning, however poor PMI data compounded the problem with interest rate differentials, and so the pound is still performing poorly.

What does this mean?

Interest rate differential is simply the difference between our interest rate set by the Bank of England, and the Eurozone base rate set by the European Central Bank. If rates are higher in the Eurozone, then investors get a better return. This causes increased demand for the currency, and so as more investors purchase it becomes stronger and the net effect is lower rates. So, higher interest rates usually strengthen a currency, and vice versa.

Rates in the UK sit at 0.5%, while EU rates are at 1%. It had been the case that analysts thought the BoE would aggressively hike rates in the latter part of 2009. It’s now thought that EU rates will rise much faster than UK rates, which is what caused the Euro to strengthen. This coupled with poor UK data caused last week’s dismal performance by Sterling.

The pound recovered on Tuesday after taking a beating last week, when dismal UK business investment figures helped to further convince the market that UK interest rates would remain at a record low 0.5 percent for some time to aid the economy. However poor PMI figures which were worse than expected, caused the recovery to be short lived, and the downturn in Sterling exchange rates continued.

This week we see the ECB announce their interest rate decision, a hold at 1% is expected, but don’t rule out a rise to combat deflation.

Markets are extremely volatile at the moment, as the big movements in exchange rates last week demonstrated. This week we have various data releases from across the globe, which will no doubt cause further changes in exchange rates.

Uncertainty is never good for business, but it does of course throw up opportunities for the bold.

Peter Elias (Agent Commercial), La Moinerie, 79500 Paizay le Tort, Deux-Sèvres

E-mail: allez-francais@wanadoo.fr

Increased activity and sales

A few weeks ago, I was reporting on signs that the market was picking up. The trend was steady rather than spectacular, starting with properties below 250,000 €. I am delighted to report that this trend is continuing, and as August closes, it has been our best month for sales since June 2006, with properties moving in just about every price band.

Quite what has inspired this rush of buyers is quite difficult to pinpoint. The £ : € rate has in fact dropped below 1.15, at level at which it has been comfortable for many weeks. That is good news for vendors returning to the UK, but hardly likely to inspire the rush in the opposite direction.

In fact we have seen quite a change in the profile of our viewing clients, with a good International mix, made up of American, Canadian, Belgian, Dutch, Australian, and Spanish, plus of course the French & British that you would expect.

I think this shows that our exposure to different markets via our extensive website portals is an important factor, and that we offer 1st class service levels throughout, to ensure that clients are very satisfied with their Allez-Français experience, whether they buy via ourselves or not.

I suppose the simple facts are that at last, people are starting to find that house sales are re-commencing, and that one sale fuels another. Certainly, I feel that property prices have bottomed out now, and the market will be looking ahead with anticipation as opposed to fear.

Last weekend we had the unusual situation of 2 offers from different buyers for the same property, whilst the owners also had 2 other offers on the table via different agencies to consider. It just goes to show that if the property is competitively priced, there are buyers out there.

Peter Elias (Agent Commercial), La Moinerie, 79500 Paizay le Tort, Deux-Sèvres, France

E-mail: allez-francais@wanadoo.fr Website http://www.allez-francais.com

Vineyards Domaines and Chateaux

In a response to a recent enquiry, we have decided to set up a specialist arm dedicated to finding French vineyards for sale.

We have identified selected professional of the wine business, to work with in business partnership. They know that setting up in a wine region requires a certain number of surveys, analyses which only a viticultural expert, who knows all the aspects and characteristics of each zone, can provide.

We are confident that our experts and viticultural consultants combine their unique competences to audit, carry out surveys, analyse and accompany you to facilitate your vineyard acquisition project.

We are also going to be setting up a specialist department working uniquely on large Chateau estates, so if either of these exciting challenges are for you, do please get in touch with us to discuss your specific requirements.

E-mail: allez-francais@wanadoo.fr

Working with your French agency

www.allez-francais.com

The Allez-Français website allows you deal directly with us on the ground in France. We are not agents based in the UK working in partnership with 3rd parties. We do work with some French agencies to supplement our property portfolio. Generally, each house on the site has been visited by one of our agents, who has been authorised to sell the house by the owner. We can often offer additional information that is not available via the website.

Our team will answer your specific questions based on his or her direct knowledge of the property, and will arrange to send additional images and conduct accompanied visits with you. In addition to offering an excellent service we keep our commissions competitive.

We help you through the legal and linguistic process of buying a property in France - from viewings to contracts. We speak your language (so long as it is French or English)!
We keep our site up to date - no pictures of alluring properties that sold years ago. These properties are for sale right now! We remove them from the site within one week of a sales contract being signed. Furthermore, if we don't have what you want on our books, we will try and find it for you.

If you would like to view some properties, please contact us to make an appointment a week or two in advance. We only work by appointment, so it can be difficult to accommodate people at the last minute. We will ask you for you your name, address and a contact number (ideally a mobile when you are in France). It is most important that you turn up for appointments. Missed and late appointments cause considerable inconvenience both to ourselves and property owners.
We will not handle any client funds whatsoever, your deposit and final payment will be paid direct to the Notaire. All of our prices include agency fees, but do not include the Notaire's charges, which are mostly government stamp duty.
Before you view, you will be required to sign a bon de visite (a visit coupon). This is required under French law to prove that we have shown you the properties indicated on the form. If you do purchase one of the properties, it does commit you to do so through us, and pay the agreed and declared commission, which is quoted as part of the sale price. We will also advise you to sign a mandat de recherche (a buyers' mandate) which authorises us to search out properties on your behalf. It does not commit you to buying one. Signing this mandat absolutely costs you nothing, and could in fact save you money.

Peter Elias (Agent Commercial), La Moinerie, 79500 Paizay le Tort, Deux-Sèvres, FRANCE
Tel: 00 33 (0)5 49 27 01 22 or Tel: 00 33 (0)8 77 07 58 99 Mob: 00 33 (0)6 62 28 02 25
www.allez-francais.com

Who wants to be a Millionaire ?

I do ! For under a £1M you can buy a lovely small chateau, dating back to the 18th Century, magnificently restored, retaining numerous original features and set in 10 hectares of beautiful gardens, park and paddocks.

This delightful C18th Chateau style property has been fully renovated with great taste, comprises of a Manoir, 2 superb large holiday rental properties, several large outbuildings including stables, and the estate has a tennis court, carp lake plus 2 swimming pools. It stands in grounds of just over 10 ha, the lake having an island, and is situated in one of the most beautiful parts of Charente, just 5 minutes from Confolens (a small market town with an Annual Festival) and 45 minutes from Limoges or Poitiers airports.

Full details can be found on our website http://www.allez-francais.com/details.php?pty_id=972

Peter Elias (Agent Commercial), La Moinerie, 79500 Paizay le Tort, Deux-Sèvres, FRANCE

Tel: 00 33 (0)5 49 27 01 22 Mob: 00 33 (0)6 62 28 02 25 Tel: 0871 717 4176 (UK)

E-mail: allez-francais@wanadoo.fr