Americans swoop on European property bargains as dollar soars and US house prices rocket

Americans are swooping on European property bargains, taking advantage of soaring US house prices and a strong dollar.

Florida interior designer Laetitia Laurent always dreamed of a Parisian bolthole and last summer found the perfect opportunity.

Nestled in the heart of the exclusive Golden Triangle, a stone’s throw from the Seine and the Champs-Élysées, she found a one-bedroom apartment for $758,606 (758,000 euros).

‘I had been looking for a place for a long time,’ Laurent told The Wall Street Journal, explaining that she often visits the French capital for work and vacations there with her husband and three young children.

The strength of the dollar along with the current housing crisis in some US cities where $750,000 will buy small homes with major issues is driving Americans to consider their real-estate odds abroad. 

PARIS: An apartment building in the sought-after 8th arrondissement of Paris where Florida interior designer Laetitia Laurent snagged a deal last summer

LISBON: A two-bedroom apartment in Lisbon is listed for $894,737 (850,000 euros). It is the located in the Príncipe Real neighborhood

Florida interior designer Laetitia Laurent estimates she shaved off an extra $100,000 from the time when she first viewed the apartment in early 2022 to when she closed the deal in Paris

FLORIDA: This is a home on Zillow in Miami currently listed for $750,000

NEW YORK CITY: This home in Queens is worth the same price as Laurent’s apartment in Paris

It’s a no brainer for some like Laurent who have been looking to sweep up new property without forking over an arm and a leg. 

In Laurent’s native Florida, a home on Zillow in Miami currently listed for $750,000 has walls covered in spray paint and cement stairs that are practically falling apart. 

Despite the home offering more than a half a dozen rooms, most appear to be in desperate need of more than just a fresh coat of paint. 

One living room area has wallpaper peeling off the sides of the walls and cement floors with cracks in the ground. 

This is the case many Americans who are in the market for a new home are finding. 

In New York City – one of the most notably expensive places to live in the US – potential homeowners can’t even dream of living in Manhattan with $750,000. 

One address listed on Zillow in Flushing has been on the website for nearly half a year and does not even include photos of the inside. 

The home appears extremely disheveled from the outside and comes ‘as is’ according to the listing, meaning the buyer could end up on the hook for thousands in repairs and facelifts. 

MIAMI: These are the stairs inside the Miami home currently on the market for $750,000

Spray paint is seen on the walls in this Zillow listing for a Miami home 

MIAMI: Wallpaper appears to be peeling off in the Miami home listing 

In booming Austin, Texas, one home which was recently cut down by $15,000 to $735,000, photos show a dark and dingy house with damaged carpets and a barren back yard. 

It’s the unfortunate truth for many in the Los Angeles area, as well. 

Buyers are certainly paying the ‘Sunshine Tax’ as it is called with homes often being priced well within $1 million to $5 million range. 

One home in the area may offer the new owner a pool but comes with some eye sores inside and out. 

Aside from the large beam in the doorframe between the living room and dining room, there are large scorch marks around the fireplace. 

Black granite flooring also meets carpeting between the dining room and kitchen. 

Meanwhile, Boston, Massachusetts similarly offers expensive homes that are practically stacked on top of each other. 

One home on Zillow in the New England state is sandwiched so tightly next to its neighbor, it appears as though a small child could only fit between them. 

It’s the same situation in the nation’s capital, Washington, DC, where the $750,000 gives the resident a narrow home and gates up against the next property. 

AUSTIN: This is the exterior of a three quarter million dollar house in Texas

The carpet appears moldy in some spots inside this Texas home, priced at $750,000

LOS ANGELES: While this home in LA will give you a pool, you will also be left with half carpet and half tile and some seriously needed up keep and TLC

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The California home has a beam in between rooms and uses black granite as flooring between the kitchen and the dining room. Scorch marks can also be seen around the fireplace

BOSTON: You will be right in between your neighbors at this $750K home in Massachusetts

WASHINGTON DC: This is what $750,000 will buy you in the nation’s capital 

Situations between the US and Europe could not be more different, it would appear, as Laurent said she shaved off an extra $100,000 from the time when she first viewed the apartment in early 2022 to when she closed the deal. 

With the war in Ukraine leaving markets volatile, wealthy Americans are looking to real estate investment in Europe where the euro and the pound have been hit hard by the conflict.

Kate Everett-Allen, head of international residential research at estate agent Knight Frank, said American interest is focused on London, Paris, Provence, Florence and Lisbon. 

Except for Lisbon – where prices rose by 11.5 percent in the first quarter of 2022 – the other cities have seen little growth.

London and Paris, which remain robust stalwarts for international buyers, were up by less than 5 percent in the first quarter of 2022.

In Florence, the capital of Tuscany, there was a 1.6 percent decline in the same period.

LONDON: A one-bedroom apartment in London’s Knightsbridge can now be bought for $1.2m (£1m) because the dollar is so strong against the pound 

FLORENCE: This five-bedroom home is on the market in Incisa In Val D Arno, around a half-hour drive from Florence’s city center. The five-acre property is listed for $1,473,684 (1,400 euros)

LISBON: The living area of the Lisbon apartment which extends to 893 square foot 

Robin Adkins, a Nashville business owner, has her heart settled on the Italian island of Capri off the coast of Naples.

The new exchange rate means her budget is up from around 450,000 euros to 500,000 euros. It has ‘definitely affected my search area,’ she told the Journal.

A survey of wealthy American buyers by real estate firm Coldwell Bank found that 67 percent of respondents owned property outside the US.

According to Wealth-X, a financial insight firm, the number of high net worth Americans who bought property overseas was expected to rise by 14 percent in 2022.

Some European countries like Portugal even offer ‘golden visa’ possibilities, allowing buyers to gain permanent residency or citizenship if they make a substantial investment.

This presents the opportunity to exploit tax breaks while acquiring a continental vacation home. 

Kelly Cutchin, of global payments services provider Moneycorp Americas, told MoneyWise that such is the scale of the real estate acquisition that many wealthy US citizens are copying moves by their friends and business associates.

‘We all have a bit of FOMO [fear of missing out], right? “Everyone in my country club is doing it — so I want to have that same status as Suzy, and so therefore, I too need to buy a property in Paris, and we can vacation together with our families,”‘ Cutchin said. 

LONDON: The kitchen and living area of the one-bedroom Knightsbridge apartment in London. The home is located directly opposite of iconic department store Harrods and within walking distance of the amenities of Sloane Street and Brompton Road

FLORENCE: The dining room of the Florence home. The property dates back to 1300 and was built by the monks of the Abbey of Monte Scalari

She said prospective buyers should speak to a real estate agent and an international tax consultant, as well as look into foreign ownership laws.

In some European states you may be restricted to an all cash purchase, while in others it is not uncommon to see a deposit north of 30 percent.

Although Laurent and her husband were able to take advantage of a strong euro-dollar rate, that chance may be closing fast.

Morgan Stanley is predicting the price to rise back to $1.15 by the end of this year.

‘Let’s face it, if the rate moves against you 10 cents between now and June of next year — when you go to actually facilitate that transaction — it might actually place you in a situation where you can no longer afford to make that investment, or you’re not as comfortable as you were previously,’ Cutchin said.