HUF Exchange Rate

C

Catser

Guest
Hi All,

In 2004\2005 I paid 50% of the price for an apartment in Budapest and got an exchange rate of less than HUF250. I then decided I wanted to terminate the contract and the developer was ok with that but it has taken until now to get the ball rolling on the paper work. I knew I would lose my 10% deposit but with the current exchange rate I stand to lose quite a bit more than that.

The developer asked if I have a Hungarian bank account so they could refund the money there and then I can transfer it back to Ireland if\when the exchange rate becomes more favourable. I don't have a Hungarian bank account at the moment so I was wondering if it would be worth my while going to Budapest and opening one or should I just cut my losses and take whatever I get at the current rate? I don't need the money urgently so if I had to leave it sitting in a bank account for a year or two it wouldn't be a problem but I guess there's a risk that the rate could become even less favourable as time goes on.

All advice appreciated.
Catser.
 
Catser,

CIB have excellant online facilities. Check out their rates online. You can get about 10% interest for HUF at the moment if you agree to keep the money in the account for a period.

If you can get a cheap Ryan air flight then you can set up the account in about 2 hours. The CIB bank on Andrassy is excellant, with English speakers. A taxi form the airport to Andrassy will cost about €20.

I have a HUF account and a Euro account. The fees cheaper than Irish banks.

So if you have the time to shoot over for a day, I think it would be very worthwhile. You just need your passport. The interest rate available for HUF deposits should help to reduce the impact of the HUF falling any further in value.

Of course I don't have a crystal ball to tell you if HUF will strengthen against the euro. If I had I wouldn't be posting on AAM!

If you need anything else PM me
 
Also consider a zero account with Citibank, since there are no charges at all for the account if you have more than x balance or x income into the account on a monthly basis. Also you can have as many accounts as you like, and u get one debit card that can access all of them.

Its a new account only been available since November.
 
Thanks a million for the replies. I still have a little time to decide what to do so I'm not going to make up my mind just yet.
 
Hi there,
Was interested in your discussion about HUF rates as I am holding HUFs at the moment. I actually sold in Budapest and was worried about security of my money in a Hungarian Bank only because I don't know much about them, so I transferred the money to an Irish account , but in a HUF account rather than Euro. At least in an Irish account the deposit is gruaranteed. The exchange rate seems to be getting worse so I thought about leaving it on deposit. The bank quoted me 7% for 3 month deposit. Anyone know any better deposit rates?
 
Didnt the Hungarian banks receive an IMF bailout recently or is that still under discussion?

Also (perhaps digressing slightly from the original thread) does anyone have any views / recomendations on the best bank in Hungary to have a Euro mortgage with?
I currently have Euro mortgage with Erste bank but am considering shopping around to see if there are any better deals from any of the other banks?
 
Can you have a HUF account in Ireland. If so, what Bank would do it?
 
Hi
Yes you can have a HUF account in Irish bank no problem, either of the main banks would have that facility.

Hungary did get a bail out earlier in the year which helped the exchange rate for a short period but it didnt last long. So much for them coming in to the Euro in 2010. It seems they are a long way off that now!
 
sputnik said:
Hungary did get a bail out earlier in the year which helped the exchange rate for a short period but it didnt last long. So much for them coming in to the Euro in 2010. It seems they are a long way off that now!
Click to expand...

http://online.wsj.com/article/SB123612843125924505.html

"ECB Opposes Quicker Euro Entry for Troubled East Europe Nation"

although their reasons for opposing it are interesting. they are essentially for allowing them into the euro early, but fear that setting the 2-year peg for the Polish and Hungarian currencies against the euro would cause speculators to test the 15% swing that is allowed in that 2-year period, and then the ECB has a much bigger problem
 
So... if you're holding hungarian forints what should one do? The rate is worsening every day so Im wondering should I just cut my lossses and convert to euro. Its hard to take the hit though! My accountant says GET OUT NOW!! Anyone like to throw in their opinion??
 
I'm going the other way, moving euros to Forint to mop up a couple of good value properties in Budapest. I'm holding on a bit longer; I think the Ft will drop more, but I don't have a crystal ball any more than anyone here.
Longer term, I think the Forint will end up in the euro at about 260, so I need to be buying at 280 to 300, or better if it looks like it is slipping further. Just my opinion!
 
I've also just converted Euros to Forints to pay my tax bill in May. Does anyone else have an opinion on where the exchange rate might settle?
jwf
 
Its at 316.5 right now, but will prob drop back on Monday. The question is, will it continue to weaken? In my view, this is the likely scenario.
See this link for historic data.
http://www.ecb.int/stats/exchange/eurofxref/html/eurofxref-graph-huf.en.html
By the way, it needs to be stressed that any views I have on the exchange rate are essentially just guesswork, and I wouldn't like anyone to make investment decisions based on my point of view. For my own part though, I'm holding off buying Forints until I see what happens for the next few weeks.
 
I disagree,

Euro is going to fall heavily over the next few months against all other currencies, except maybe the Yen, the Hungarian Central bank is committed to prevent further falls in HUF, the combined effect will cause an incease value of HUF to the Euro. The question is what will be the stabilization point 280 HUF vs Euro maybe 260 ??

I think the HUF will strengthen alot further beyond that level before EMU II entry.
 
Lollix said:
Its at 316.5 right now, but will prob drop back on Monday. The question is, will it continue to weaken? In my view, this is the likely scenario..
Click to expand...

I was right about that anyway, its at 310 today. I still reckon it will fade further, probably to 340 or close to it.
Medium term, I agree with the previous poster, it will probably settle back around 260 to 280.

As I said before though, its mostly guesswork on all our parts, and it could go any way.
 
I'm like you Sputnik, I don't know much about the Hungarian banks so I've decided to open a HUF account with one of the Irish banks as it feels a little more secure. I have no idea when I'm going to receive the payment though as I'm still waiting on paperwork from Budapest. It could be a few weeks or it could be months so who knows what the exchange rate will be. I'm watching and waiting and hoping that Lollix and Budarich are right! Thanks for everybody's input btw.
 
Catser,

Please beware of people who spout on this website, especially about exchange rates. Read the following thread for your own financial health.

http://www.askaboutmoney.com/showthread.php?t=76027&highlight=HUF

Just a relevant excerpt.

#2
26-02-2008, 08:01 AM
BudaRich
Frequent Poster
Posts: 71


Re: Hungary abolishes HUF band
Between now and 2010 the HUF WILL strengthen against the EUR - as it must do to be able to enter the EMU-2



which prompted a response:


26-02-2008, 09:05 AM
Camry
Banned
Posts: 376


Re: Hungary abolishes HUF band
Wow, some confident bets there guys. You must have made a absolute bomb on foreign currency markets (one of you wouldn't be George Soros would you?).

The ONLY conclusion potential property "investors" in Hungary should take from this is that there is and always will be significant FX risk in such an investment. Plan carefully and hedge where required/desired.

ANd for my part I would suggest turning to Mundell-Fleming (and also the Dornbusch Overshooting model) to try and interpret what forces may be driving the exchange rate in the coming years. That would probably support the case for a FALL in the HUF over a couple of years (although it might rise over 6-12 months first) leaving unhedge EUR based investors nursing a significant FX loss.

And if you don't know what a Dornbusch Overshooting, or Mundell-Fleming model is, you don't really have any place telling the type of financially vulnerable people, who frequent this site for advice and opinion, what may (or worse will) happen in the world of FX.
​




I will leave you to draw your own conclusions.
 
Hmmm, just took a second look at that thread.

Why is it that those posters who seem more informed and employ better judgement appear to get banned?????
 
Timbo said:
Hmmm, just took a second look at that thread.

Why is it that those posters who seem more informed and employ better judgement appear to get banned?????
Click to expand...
It's askaboutmoney, not asksomeonebetterinformedwhoemploysbetterjudgement. Just say that all those overseas properties with mortgages in currencies separate to the rental stream are going to be just fine. After all, auto320 isn't here any more to contradict.
 
Between now and 2010 the HUF WILL strengthen against the EUR - as it must do to be able to enter the EMU-2

The pretense holds true - HUF will strengthen against EUR for EMU 2 entry. But the timing is a little out due to the credit crunch perhaps.

Property investing is not an exact science, and it is a long term investment, as for advice on a forum all you get is opinions.

The key thing to forums is to come to your own conclusion, draw your own opinion from what you read / learn. But whatever you do dont just listen to one person.

Ask 5 different finacial advisors and you will get 5 different sets of advise as to where to invest your money.

People who let a fiancial advisor invest their money are asking to lose it. How many fiancial advisors do you know who predicted the credit crunch?

I did predict it - and invested accordingly based on the best information at the time.
 
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