The currency blog

Over the past 20 years, international property investments have become more popular and are now within reach of the average person. The low cost of travel and tourism have been the main drivers for this market and South Africa should soon start seeing the benefits of the positive exposure the country has experienced throughout the Soccer World Cup and other tourism drivers.

Investment in International property happened quite early in Europe, as most Europeans tend to feel more comfortable with change and have a higher level of intrigue for new destinations. After all it was the Europeans who set off on the voyages of discovery – and settled in countries as far away as New Zealand and Paraguay.  

Investing in a property abroad was at first the domain of the super wealthy across Europe and at first it was mostly other countries in Europe that caught their eye. However as interest grew, more and more destinations were identified, locations as far as Australia and Panama became popular. Today these hotspots can be found around the world, driven by tourism, yet still a strong bias of purchases from the UK and European countries.

Today over 4 million British people live in southern Spain. This has had a dramatic effect on the Spanish property market. It is not just the British that are happy to relocate, many other nationalities in Europe have followed suite. Another great example of this is Florida, UK purchasers spent over 1 billion dollars on properties in Florida in the past 2 years. Disney has done a great job promoting Orlando as a dream destination, and that is exactly what the UK market bought into, resulting in over 250 000 foreigners purchasing a property there.

Whilst housing markets around the world are “local” in terms of values, this can change when a tourist arrives in town. In cities around the world that have the ingredients to become a tourist attractions the prices of property in that location are generally going to be higher that those seen in other areas.

The answer is simple where there is an attraction for tourism there will be a property investment serge. Improved risk profiles, positive publicity and the successful hosting of the FIFA Soccer World Cup have all collectively positioned South Africa as a world class destination, one that Europeans and the British are beginning to notice. It won’t be long before they begin packing the bags and heading towards the tip of Africa for their own magical experience in South Africa.

The South African Rand (ZAR) will continue to reflect rapid changes in investor sentiment. A widening current account deficit will point to a depreciating bias of the ZAR vis-à-vis the US dollar, Euro and GBP later in 2011 and 2012.  However recently the ZAR has performed well on the back of a continued thirst for commodities and yield.  This tide should start to change once the major economies start to raise interest rates- we expect the ECB to kick off this trend with an interest rate rise on Thursday, followed by the UK within 2-3 months and finally the US Fed.  Current levels present a great opportunity to sell ZAR into GBP and other major currencies.

Currencies Direct has recently repositioned their African office to provide a range of forex solutions to clients wishing to transfer funds into and out of Southern Africa. These services are now available to both residents and foreigners and additional services related to tax clearances and exchange control are also now available.

South Africa has traditionally had very strict exchange controls to prevent residents from moving money abroad and non-residents from bringing in vast sums of foreign currency. However, in the past 18 months, the South African Reserve Bank has relaxed these regulations to allow greater flexibility and encourage interest in the South African market.  Both investment and discretionary allowances have increased  and this has seen many South Africans taking advantage of the opportunity to invest abroad.

Additional relaxation regarding repatriation of funds has come into effect, providing much needed surety for foreigners. It seems South Africa is embracing the opportunity for both private and corporate foreign investment.

Over the past six months, Currencies Direct has been improving their local systems and processes to ensure we offer a superior service to all our clients. In addition a recent partnership with Incompass Financial Solutions, a South African FSB registered company, has enabled a full international payment and currency transfer offering.

As of 1 January 2011, Currencies Direct  SA now offer the following services:  

•    Currency trades for both money in and money out of South Africa

•    Foreigners purchasing property in SA

•    Foreigners repatriating funds abroad after selling a property in South Africa

•    South Africans returning home and bringing funds in from abroad

•    South Africans wanting to release funds that were blocked when they emigrated

•    South Africans wanting to take advantage of the relaxed exchange controls , and taking both their investment and discretionary allowances out the country

•    Forex management for SMME’s (small to medium enterprises)

•    Complimentary SARS Tax Clearance and SARB Exchange Control support and assistance when transferring funds abroad

As Currencies Direct is not an Authorised Dealer in South Africa, foreign exchange transactions out of South Africa are processed through an authorised dealer bank in strict accordance with exchange control and SARB regulations.

So if you or your clients are looking to make or receive international payments from Southern Africa or would like to transfer funds out of South Africa, make sure you call Currencies Direct. Our efficient service, competitive rates and local knowledge will ensure your transaction is hassle free and gives you the most value for your money. Call our office on +27 (0) 21 418 0105 or email us on capetown@currenciesdirect.com

We Are The Champions!

After a fantastic season of solid wins, the team finished top of the league with a  5 point strong  lead. The CD team not only beat the the banks on FX but also in football;  Deutshche Bank lost almost every game against the Currencies Direct boys so let’s hope next season is just as glorious.

All dues to the following players:

Dan Cronin, Matt Watson, Alistair Cotton, Chris Partridge, Harry Cosgrave, Aldrino Rodriques, Phil Mchugh, Tim Lewis, Reece Merrick, Lee Chappell,

Player of the season went to Dan Cronin after scoring 10 goals alone in the season, Matt Watson was joint top scorer of the season.

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Karl Sieha

Season 2 First Match - Deutsche Bank

Season 2 of Top Corner Old Street league saw Currencies Direct enter the newly formed premier league as champions and favourites for the title.

First opponents were previously conquered Deutsche Bank. Buzzing at the start, the kraut bankers were seeking to score one for the euro but there was only going to be one winner.

The line up consisted of Cat Partridge in goal, with Weasel Chappell, Dino-Tim, Fabio Cotton and Webbed Swanson.

The game started with the German money men kicking off and moving the ball around with plenty of verve but as soon as we gained possession a tirade of orange and black hit their goal. The post was rattled twice and their keeper was in great form to prevent CD taking the lead.

The deadline was then broken with Chappell finding Tim Lewis who finished with aplomb. Like the battle of the Bulge, this signalled the beginning of the end for the Germans. Chappell again provider found Cotton, tireless in his endeavours, finished strongly to double the score line.

The their striker produced a moment of inspiration and stunned proceedings by picking out the top bins to leave Partridge sprawled across the goal and pull a goal back. This rest bite wouldn’t last long.

Thanks to great pressure from Cotton, pouncing on a loose ball, Chappell swooped like a spitfire in the middle of a dogfight to destroy his target and add a third.  Half time 3-1.

The second half was as one sided as the first with CD dominating in all areas of the pitch and the sauerkraut eaters were struggling to get out of their half. Great work by all created several chances but it was left to goatman Watson to strike probably the best ball I’ve seen at this place and hit the upper echelons of the side panel from 10 yards out to make it 4.

T-rex Lewis, following assists from Swanners and Partridge, completed the scoring and settle the match, 6-1 to CD.

One game in and top of the Prem, get in.

Report By Chris Partridge

Maria Petrak, founder of “The Best of Marbella” and “The Best of Vienna” weblogs, is passionate about the quality of life. Maria has lived and worked in many different countries, learning seven languages and experiencing the myriad benefits of multicultural living. Her weblogs allow the readers to share her exploration of the world. A single parent, Maria discovers the special benefits of each city for herself and her child, then uses that knowledge to serve the community of readers. She answers the need of both visitors and residents for recommended and trusted businesses and services, shares opportunities for cultural exchange, and promotes worthy local businesses and charities, online and offline. Making the world a better place is one of her main goals in life. Read the rest of this entry »

We’re on a journey through France bringing information to ex-pats to help them negotiate the pitfalls of international finance, making their money go further. The first two free ex-pat forums took place on 1^st and 3^rd March and were a great success. Next week the tour visits Monbazillac in Aquitaine and Rivel in Pyrenees Roussillon.

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