sterling at 1.15 euro... worried and shocked

[laswalkirias]

I wonder if there are others like me dependant on income from UK and have found that living in Spain has become a financial nightmare.Renting for the first year is just about doable but moving to buy is rapidly becoming a pipe-dream as once relative cheap property prices in Andalucia have at the current exchange rate become unattanable even with the latest reductions in asking prices for property

[laswalkirias]

Aphologies to the spelling and grammar police for my unchecked post!!!!

[spanish_lad]

everyone said it´ll be around 1:1 by christmas looks like they might of been right.

houses round here are dropping RAPIDLY in price. ie 3 bed townhouse - under 80k. you couldn´t get anything for less than 220k a year ago. we were laughed out of estate agents when asking about 200k fincas. i´ve seen one today, a stones throw from the beach, 4 beds, 4000m2, for under 150k.

[costakid]

what is the location of the villa spanish?

[Retro P]

Sorry to say this but, trust me, sterling will be worth less than a Euro by Easter 2009, I am never wrong about money!

[princess peach]

We are not dependant from money from UK,but my hubby gets his wages in pounds(Gibraltar)so he has to change it up into euros every week.E1.10 to the pound on Thursday in Gibraltar
We know his company has more than enough work for the next couple of years(so thats a good thing..at least he wont be out of a job)but we are 70.00 pound a week worse off with all this going on.
Its horrible,but at least you can take a little comfort knowing everyone is in the same boat.Some even worse off than you.

[oliveview01]

Pulling in the belts even more As long as the Christmas visitors (5 extra folk) don´t expect a massive banquet we will be ok

[Devils Advocate]

It just proves the benefit of being under the "eurozone umbrella" when a country like Spain has a stronger currency than the UK albeit subsidised by the stronger member countries.

These things go around in big circles and to coin an old played out saying Britain IS subject to "boom and bust" on a 10-15 year cycle, but the country is fundamentally solid, and will grow economically once more in the near future. At the same time the non-productive countries in Eurozone will stay stagnant and their interest rates may also be slashed. The rate will pull itself back as this happens but playing catch up from 1.15 is going to be difficult I'd imagine.......1.30-1.40 is what a lot of financial commentators say is the true level when the dust settles.
Being a non financial thinker myself my main worry is Gordon the Gopher "bottling" it and joining the Euro if it slips further towards 1 to 1 , although I believe legally this would require a referendum which I think could go either way.............I'd vote NO if it were less than 1.35 at the time anyway.

I feel for the guys similar to the original poster on this thread who's livlihood has been slashed over night through no fault of their own and hope upon hope it rights itself sooner rather than later.
I'm glad we haven't jumped ship yet and from a selfish point of view hope the rate improves a bit in time for when we next visit the casa in March/April.........the date some say the £ will be in negative equity.
I personally don't think it will be to be honest but we'll see.
I sincerely hope everyone weathers the storm and that a bit of light at the end of the tunnel appears shortly..................as it historically will.

DA

[katy]

Spain and some of the other Eurozone countries need a lower euro. Spain has the highest unemployment rate in Europe. It could be an advantage to the UK to have more flexibility and send the pound dipping. I can't see sterling improving until the Brown bunch go.

Certainly going to affect the local economy here. Whatever the British spent per month they are going to spend at least 20% less. Must be an absolute disaster for those already on a tight budget.

[Jool]

We too are hit by the exchange rate, like most people out here. If Spain was not in the euro it would have more flexibility to change its own interest rates and thus help its own currency.......and people. At the moment the euro is artificially high considering the recession going on in euro countries.

I have heard that the UK govt would step in and support sterling if it got close to 1 for 1. Gambling on exchange rates is not for the faint hearted.......

Desperation to get back to the UK is one of the things making so many houses over here so low in value. Perhaps if the EU resolution, due to be voted on in March, really has the teeth it claims (ie to cut off funding to Spain until it stops property abuses on things like legality and urbanising costs) this will also help as it seems such an uncertain thing now in uncertain times. I wish we had waited to buy again but with the 2 year limit on re-investing property proceeds we´d have lost too much to the govt.

RetroP - I think you are unduly pessimistic but out of interest what do you base your prediction on?

[spanish_lad]

what is the location of the villa spanish?

benjerafe.

heard about 2 more yesterday - one in elviria, on an urb. where they are 250k upwards, was re´po´d by the bank and sold for 70k. another in marbella itself, again re´po´d and should of been 4.2 mil, went for 1.2

Pulling in the belts even more As long as the Christmas visitors (5 extra folk) don´t expect a massive banquet we will be ok

if they are coming to yours get them to contribute. i´ve got friends who never spend christmas at home, they go round ech others houses each year, buy everything together, they all chip in to a "pot" it usually costs them 20 euros each.

theres a few resturants doing christmas dinners in alhaurin, buffet style, 20 euros a head !!!

Must be an absolute disaster for those already on a tight budget.

tell me about it


as for the exchange rate ? i advised my nan and my aunt to invest in a few hundreds worth of euros a couple months ago when the rate was higher. they got 500 each if they change back today they will make money on it. if i had the spare cash back then i´d of done it too.

[beachbabe]

the UK govt would step in and support sterling

That does not work. The markets have more money than the UK government.

And do not wory about £ joining € at 1:1. The rest of europe would never allow such a favourable conversion rate!

It will be a tough couple of years but the £ will recover. Just look at the £ vs dollar over the last 20 years - up and down like a whore's drawers. Just as it has never been wrong to buy $ at 2 to the pound, it will always be wise to load up on € when it hits 1.40+

Where do you find out about repo's - i'm always after a bargain.

[pentaqua-new]

Check UK and even French shopping prices V those here in Spain! It's a no-brainer - here is still less expensive - even with the rate falling.

[Devils Advocate]

It depends on which items you compare though. The big money saver in Spain is house rates/water rates and utility charges, actual every day comodities seem similarly priced to me if we're talking bread/coffee/meat/etc. etc. In fact we're now buying Albali white wholesale here cheaper than the local Coviran over there

DA

[pentaqua-new]

Er, petrol? Drink? Meals?

Lidl promotion in UK for ski wear one pound more expensive per similar item than the euro price in Spain! e.g. Ski sun glasses £5.99 in UK - €4.99 here - etc etc

Admittedly in September, petrol in France €1.54, in Spain €1.18. I seem to remember paying £1.46 near Stansted aiport in the same period.

Thanks, but we reckon our money goes further here - in spite of the grotty rate.

[katy]

I have been to the UK 4 times since August and I think the UK is definately better value for money in quality, choice and price (especially with the low exchange rate!) Been to France a couple of times too this year and noticed fruit and veg are cheaper and it is certainly cheaper to eat out.

Suppose we are slightly off-topic though..someone will be quoting menu del día next

Remember the official A.com mantra 'everything is cheaper in Spain'

[Devils Advocate]

Er, petrol? Drink? Meals?

Don't know what the Er was for but never the less

1)Petrol?, it's 86p a litre here today don't know what Spain is today but not lightyears away I'd guess.

2)Drink?, do you mean Tea, coffee, coca cola?, again similar prices in fact Nescafe is dearer there
OK, wine has been traditionally cheaper there but as I said above we can now buy the mundane Albali white cheaper here than some outlets there.

3)Meals?, That's been done to death on here ..........Yep if you're talking the 5.99e Menu del dia as Katy mentions then fine....you win, but that's not everyones cup of tea including mine, do you not think that there's cafes here doing all day greasy Joe fry ups of similar quality for less?
For proper decent meals again theres not much in it but the UK will probably be that bit more expensive due to the higher rates etc. the establishment has to pay opposed to Spain..........the point I made in my first post about the one advantage on costs Spain does have.

DA

[Jool]

Its not just about money though is it......at least over here you can go out in comfort most days in the Winter.......not like a Michelin man in quilt.......and it does not get dark at 3.30pm, that was sooo depressing for me in the UK......

However against that is fact houses have poorer insulation than those in UK so take more kilocalories of heat to warm up.......

Price wise, I am always shocked by the price of coffee in a cafe in UK, I become a Mrs Meldrew......

[Jool]

Diesel yesterday 92 cents a litre, is it 80p in UK now?

[Devils Advocate]

Totally agree Jool, Spain does have many, many benefits which is why we've put our hard earned into it.....I'm not or have ever denied that.
However it's just the when I hear that the cost of living is so much cheaper there I have to voice what I consider is the truth as I/we find ,and the big saver is house running costs over a year.
Unless I'm missing something drastically everyday items are priced very similar especially groceries.

DA