Rising Dollar May Hurt NY Real Estate

The dollar's recent rebound may have a negative impact on the real estate and tourism industries

The dollar's recent rebound may have a negative impact on the real estate and tourism industries, according to economists. The dollar has come back over the past month, surging against both gold and foreign currencies, including the euro. Economies expect that it will continue the rise through next year.

This trend, along with the weakening of the European economy could slow down the number of European buyers that have so far kept the city's real estate market from feeling the worst of the sting of the real estate crisis. "Europeans are going to start pulling back, to change business and personal vacation planning," a former New York State deputy comptroller and an associate professor at New York University, Rosemary Scanlon, said. The influx of foreign tourists "has been a really good buffer for us all summer, but now, we'll be much more at the mercy of whatever the local downturn may be."

Over the past month, the value of the dollar has increased dramatically. One dollar is now worth .381 grams of gold, which is up 21% from last month. It has increased 8 percent against the euro, causing a $3 million place in the city to cost 2.03 million Euro at this point. This is up 1.87 million euros in mid-July. Europeans make up approximately 1/3 of condo sales in the city, and 15 percent of the total real estate market. Additionally, nearly 20 percent of the city's tourism comes from European countries that use the Euro as a base currency.