US Dollar Is Not What It Used To Be.

Many of my friends in the USA are understandably busy with their everyday lives and although they to keep in touch with the rest of the world, in working “too many” hours per week, it’s difficult keeping up to date with what’s going on.

We look at the dollars in our hand and assume that it means something but, the sad fact of the matter is that the US dollar is worth less than it has done in a very long time.

Just in the last five years, the US dollar is down 43.9 percent against the euro, down 61.8 percent against the Canadian dollar, down 10.2 percent against the Chinese yuan, down 5.6 percent against the Japanese yen and down about 30 percent against the British pound.

On a positive note, the US dollar is up 5.8 percent against the Mexican peso. (??)

The good news is that a weak US dollar means increased exports, more foreign investment, it helps to reduce the trade deficit and encourages more tourism. For example just at the beginning of the year, a USD$250 hotel room cost CAD$295, now it only costs CAD$250, which mean the Canadian tourist saves over 15 percent.

Think of that in terms of a $250,000 luxury condo in Costa Rica and it becomes more meaningful.

The bad news is that a weaker dollar means higher costs for foreign goods, tighter monetary policy and foreign travel – not even thinking about rising oil prices – to many beautiful and exotic places becomes more expensive.

Some investors – myself included – believe the US dollar will fall even more. Jim Rogers, co-founder, along with George Soros, of the Quantum Fund is a very wealthy investor who recently stated: “I’m in the process of – I hope in the next few months – getting all of my assets out of U.S. dollars…” (1)

In England and Wales “The average price of a property in September 2007 stood at GBP£183,896.”(2) At today’s exchange rate, that £183,896 is equivalent to US$382,871 so now you now why Costa Rica real estate looks so affordable to my fellow Brits and there are similar comparisons to many European countries…

American buyers should consider themselves lucky that it takes a lot longer for Europeans buyers to get here otherwise we would be paying a lot more for Costa Rica real estate…

At the moment, all of the English language real estate marketing we see in Costa Rica use US dollar prices but last week for the first time, I met with developers who told me that they would prefer to be paid in Euros…

Is this a sign of things to come?

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Written by Scott Oliver, author of How To Buy Costa Rica Real Estate Without Losing Your Camisa and Costa Rica’s Guide To Making Money Offshore.

Andrew Makarik

to@welovecostarica.com

Andrew Makarik is the main editor of WeLoveCostaRica, a fan of this sunny country. He is also a loving husband and a has a lovely daughter. By being a devoted family man and the biggest Costa Rica fan, he wants to make more people feel at home there. WeLoveCostaRica unites people and helps them find new home or a new travel destination. This website is a friendly community where everyone can find not only information, but also new friends and travel pals. Andrew is also passionate about IT and programming, so he himself maintains a friendly atmosphere in this cozy environment of WeLoveCostaRica.com.