Jody Cracknell

The international property buyer has been an important source of business for many US Realtors since the market downturn. It’s estimated that between 150,000 and 190,000 homes were sold to foreign nationals from May 2007 to May 2008. Canada replaced Mexico as the country with the largest share of foreign buyers in the U.S. The percentage of Canadian buyers doubled from last year, from 11 percent to 23.5 percent according to a recent National Association of Realtors survey.



However, the recent strength of the US dollar (USD) against the Canadian dollar (CAD) is now starting to make it more expensive for Canadians looking to buy U.S. properties. Meanwhile the Canadian buyer knows that real estate prices in the U.S. are at historical low levels. Could it be that continued strengthening of the US dollar will prevent Canadians from fulfilling their dream of owning a “place in the sun”? It doesn’t have to be, particularly if the Canadian buyer accesses some of the new financial products available in the marketplace.



The Situation:

After gaining 17 percent in 2007, the Canadian dollar is down 6.4 percent in 2008 amidst a shrinking economy and a drop in oil prices. On August 8th 2008 alone, the Canadian dollar dropped 1.2 percent against the U.S. dollar, the biggest decline since March 20, 2008. The Canadian dollar is currently trading at CAD $1.0626 per US dollar, the lowest since last August.



A real example: due to the impact of fluctuating exchange rates, the cost of a U.S. Condo (priced at USD $300,000) for the Canadian buyer has increased by CAD$ 20,040 in just 3 weeks.



Cost in CAD $300,510 Cost in CAD $320,550

VS.

July 21st , 2008 August 8th, 2008

(CAD$1.0017 = USD$1.0000) (CAD$1.0685 = USD$1.0000)



Can this pricing increase continue? Is there a way for the buyer to insulate himself/herself?



The Solution:

If the US dollar continues to strengthen against the Canadian dollar, an excellent way to protect against the market volatility and downside risk is through a “forward contract.” There are companies, such as HiFX, that provides forward contracts out to 2 years in the future, effectively helping clients lock in exchange rates and give them peace of mind.





Please feel free to contact me at 415-678-2770 or jody.cracknell@hifx.com



Regards



Jody



Jody Cracknell

Business Development Manager



Refer A Client



HiFX Inc.

250 Montgomery Street, Suite 910

San Francisco, CA 94104



Phone: +1 (415) 678-2770

Toll Free: 1 (877) 999-4439

Fax: +1 (415) 773-1822

Mobile: +1 (415) 728-1381



Email: jody.cracknell@hifx.com

Web: http://www.hifx.com/personal.aspx



Auckland London Marbella San Francisco Sydney Toronto Windsor



The details expressed in this transmission and accompanying documents are for information purposes only and are not intended as a solicitation for funds or a recommendation to trade. HIFX Risk Management Inc accepts no liability whatsoever for any loss or damages suffered through any act or omission taken as a result of reading or interpreting any of the above information. - Thu Aug 21 2008, 16:57

The international property buyer has been an important source of business for many US Realtors since the market downturn. It’s estimated that between 150,000 and 190,000 homes were sold to foreign nationals from May 2007 to May 2008. Canada replaced Mexico as the country with the largest share of foreign buyers in the U.S. The percentage of Canadian buyers doubled from last year, from 11 percent to 23.5 percent according to a recent National Association of Realtors survey.



However, the recent strength of the US dollar (USD) against the Canadian dollar (CAD) is now starting to make it more expensive for Canadians looking to buy U.S. properties. Meanwhile the Canadian buyer knows that real estate prices in the U.S. are at historical low levels. Could it be that continued strengthening of the US dollar will prevent Canadians from fulfilling their dream of owning a “place in the sun”? It doesn’t have to be, particularly if the Canadian buyer accesses some of the new financial products available in the marketplace.



The Situation:

After gaining 17 percent in 2007, the Canadian dollar is down 6.4 percent in 2008 amidst a shrinking economy and a drop in oil prices. On August 8th 2008 alone, the Canadian dollar dropped 1.2 percent against the U.S. dollar, the biggest decline since March 20, 2008. The Canadian dollar is currently trading at CAD $1.0626 per US dollar, the lowest since last August.



A real example: due to the impact of fluctuating exchange rates, the cost of a U.S. Condo (priced at USD $300,000) for the Canadian buyer has increased by CAD$ 20,040 in just 3 weeks.



Cost in CAD $300,510 Cost in CAD $320,550

VS.

July 21st , 2008 August 8th, 2008

(CAD$1.0017 = USD$1.0000) (CAD$1.0685 = USD$1.0000)



Can this pricing increase continue? Is there a way for the buyer to insulate himself/herself?



The Solution:

If the US dollar continues to strengthen against the Canadian dollar, an excellent way to protect against the market volatility and downside risk is through a “forward contract.” There are companies, such as HiFX, that provides forward contracts out to 2 years in the future, effectively helping clients lock in exchange rates and give them peace of mind.





Please feel free to contact me at 415-678-2770 or jody.cracknell@hifx.com



Regards



Jody



Jody Cracknell

Business Development Manager



Refer A Client



HiFX Inc.

250 Montgomery Street, Suite 910

San Francisco, CA 94104



Phone: +1 (415) 678-2770

Toll Free: 1 (877) 999-4439

Fax: +1 (415) 773-1822

Mobile: +1 (415) 728-1381



Email: jody.cracknell@hifx.com

Web: http://www.hifx.com/personal.aspx



Auckland London Marbella San Francisco Sydney Toronto Windsor



The details expressed in this transmission and accompanying documents are for information purposes only and are not intended as a solicitation for funds or a recommendation to trade. HIFX Risk Management Inc accepts no liability whatsoever for any loss or damages suffered through any act or omission taken as a result of reading or interpreting any of the above information. - Wed Aug 20 2008, 09:36

Hi Dave,

You will also need to consider the currency aspect of your property purchase in Miami. You can use your bank to transfer Canadian Dollars to US Dollars but they will not provide you with the most competitive exchange rate.

'Currency Specialists' can provide significant savings changing your Canadian Dollars to US Dollars, they will also be able to help you 'lock' in exchange rates so you are protected against any adverse currency fluctuations and transfer funds free of charge.

If you would like any further information please contact me.

Regards

Jody Cracknell

Business Development



HIFX Inc.

250 Montgomery St.

Suite 910

San Francisco, CA 94104

Toll Free: (877) 999-4439

Office: (415) 678-2770

Fax: (415) 773-1822

jody@hifx.com

http://www.hifx.com/personal.aspx





Auckland London Marbella San Francisco Sydney Toronto Windsor

The details expressed in this transmission and accompanying documents are for information purposes only and are not intended as a solicitation for funds or a recommendation to trade. HIFX Risk Management Inc accepts no liability whatsoever for any loss or damages suffered through any act or omission taken as a result of reading or interpreting any of the above information. - Thu Feb 21 2008, 10:17