Country Article / Postcards
HOW TO EARN 45% IN ONE YEAR
Date: 06/24/2003Dear International Living Reader,
Last year this time, we bought an apartment in Paris. Seemed like a good idea. Our dollars were strong...the apartment was in a prime location...and, well, it was something we'd always wanted to do.
We didn't get a smokin' deal...in fact, we probably paid at the high end of the market at the time, about $6,700 per square meter. As I said, the apartment is in a good neighborhood.
We've just reviewed returns for our first 12 months of ownership. The apartment has netted about 5.5% from rental income, after all costs and expenses, including fees to the rental management agency. Not bad, considering what a tough year it's been for tourism in general and for tourism to France in particular...but nothing to get excited about.
However, there's more to the story.
In addition to the 5.5% from rental income...we've made more than 30% this past year from the appreciation of the euro against the dollar. By some stroke of good fortune, we put our dollars (about 320,000 of them) into the euro...just months before the euro began its steady climb in value.
Furthermore, in the last 12 months, apartments in that neighborhood of Paris have appreciated in value about 10%.
In other words, this apartment has returned, in total, more than 45% in one year...most of it from currency appreciation.
Kathleen Peddicord
Publisher, International Living
P.S. Last week, we signed the promesse de vente (the promise to buy) for a second Paris apartment. What are we...stupid? Why put dollars into euro now? We're asking ourselves the same thing, as we check the value of the Greenback against the euro each morning. We found this apartment and decided to invest before the gap between the two currencies widened to its current spread...and, now, we're pushing ahead, interim currency events aside. We've negotiated a good price...less than we paid last year for the Rue Mazarine apartment--about $6,400 per square meter. But this will likely be the last Paris pied-a-terre investment for some time.
P.P.S. Yesterday, I sent you a special report from IL contributing editor Porter Stansberry about an upcoming opportunity in China that Porter is calling "the biggest currency move of the decade." If you're interested in acting on the information presented in this report, you have until July 1 to do so. If you haven't already, I urge you to read Porter's report now: Make the Chinese Pay.
Rate this Postcard:
Rating: 3/5 (27 votes cast)