Exchange Rate Motivates Americans Looking To Buy European Homes

As prices and rates rise in the US, a falling conversion rate has made home abroad that much more attractive. The Wall Street Journal reports that favorable exchange rates and steady property prices have led to big interest in markets like London, Paris, and Tuscany.

Reasonable appreciation. Over the last two years, home prices in the US have jumped close to 40%. Between the first quarter of 2022 and Q1 2201, home prices in the US jumped a record 20.6%. Meanwhile, in Europe, price gains in local currencies are modest to nonexistent.

• “According to the most recent Knight Frank Global Residential Index, prices in greater London and Paris rose less than 5% between the first quarter of 2021 and the first quarter of 2022, while prices in Florence, Tuscany’s capital, dropped 1.6% during the same period.”

• Luxury homes the savings are even more impressive. “A 3,229-square-foot, four-bedroom, Savills-listed apartment in Knightsbridge has an asking price of £13 million, or $15.13 million. When it came on the market in mid-January of this year, the price, which has been the same in pounds since listing, was $16.4 million.”

Some data. All of Europe is seeing an explosion of American buyers. In Portugal, the estimated investment of American buyers has tripled since 2021, totaling an amount of 25.1M euros, according to the Portuguese Service of Foreign Immigration. In France, searches for properties by US-based buyers jumped 37% in the first five months of 2022, according to real estate company Knight Frank.

Two kinds. Teresa Almeida Pinto, a sales manager at Portugal Sotheby’s International Realty’s Cascais office, tells the journal that American buyers tend to break down into two categories: “young digital nomads looking for walkability in the densely built-up resort centers, and retirees who may want access to golf courses further out along the Atlantic coast.”