Sunday, August 30, 2009

Shopping around in a credit crunch

A lot of expats don’t shop around as much as they perhaps should, although now it's more important than ever to do so. That’s particularly true in countries where English is not the native language because trying to get comparison prices AND bargain in another tongue is not easy. It’s certainly a big help to a supplier or potential seller if they can pretend they haven’t got a clue what you’re talking about when you ask them why they’re trying to charge you double what they charge everyone else.

Even in English speaking countries it’s not always easy. A response such as “maybe you can get it for that price in England but here in the US of A nobody has been able to buy it at that price since the 1930s” can sort of stop you dead in your negotiating tracks.

However, it’s worth trying. Take a recent example - I had to renew some insurance.

For about 4 years I’d been using the same company. I’d received good service (though I’d made no claims) and the price didn’t seem too bad either. Still, I thought it was about time I looked around and checked online. To my surprise, I found I had several other options to purchase identical insurance at almost 150 euros cheaper per annum.

So I called my local office and asked if they wanted to re-quote. They seemed surprised that I would consider moving insurance for “only 150 euros” given that we had a good relationship. I thought to begin with that they were joking but saw rapidly that they were not. I slightly sadly had to explain to them that one annual phone call to confirm renewal hardly constituted a ‘relationship’. Much as I enjoyed their sparkling wit and repartee in our 2-minute chat each year, I didn’t actually think it was worth 150 euros.

So they changed tack to try and persuade me to stay with them. “Have you considered the benefits of our service and having a local office you can call into?” Once again, I had to say that I’d only been into their office once in several years and even then for only 5 minutes. Over the 4 years that 5 minutes had cost me about 600 euros – not exactly good value for money. Pleased as I was for them that they had a nice office in a nice location, it didn’t benefit me one iota.

After a few more increasingly bizarre attempts to justify their extra 150 euros per annum, they gave up and said they couldn’t match the price offered by the Internet supplier. I admit that I had some sympathy when they said, “we struggle to compete with many of the new online companies”. I almost felt mean and a little nostalgic for the ‘old world’ of the local office – right up until they followed up by saying “…and it’s usually the British that are very vulnerable to this sort of selling tactic….”

Selling tactic? Beating someone else’s price by a considerable amount is now some form of ‘dirty trick’? The British are somehow ‘saps’ for wanting a bargain? My sympathy evaporated. Ah well, “next time” I said. The moral of this tale is? Forget nostalgia – get those fingers tapping and hunt for some bargains!

Monday, August 24, 2009

Protectionism and its effect on expats

Whether you’re a ‘corporate assignment’ type of expat or someone who is settling in a new country notionally forever, it seems likely that you’ll have read recently about moves towards ‘protectionism’ in many parts of the world. You’ve also probably been slightly concerned.

There are a few examples that have made headline news and others that have been rather less well reported. Examples include the “British Jobs for British Workers” strikes and disruptions in the UK oil industry and French politicians campaigning for the plants of French car manufacturers in Eastern Europe to be closed and their production moved back to France.

I’m not just picking on the UK and France. There have been major similar incidents and campaigns in many other countries in Europe plus the USA and Australia.

It’s no great surprise that economic hardship and recessions lead to a natural tendency to say, “let’s look after our own and let the foreigners sort their own problems out”. Sadly there are also a tiny minority of disreputable politicians who will also use troubles to wheel out their ancient and discredited views about how bad foreigners are in general.

In fact, the views and concerns of expats on this subject tend to vary slightly depending on the nature of their expatriate status. I’ve spoken to a number of expats of the fixed-term ‘corporate assignment’ variety that are slightly concerned that background political pressures to keep high-paying jobs for ‘locals’ may lead to an early curtailment of their job.

By contrast, many ‘permie’ expats seem to see this as a less of an issue. In some cases that’s a tribute to their integration or in others that they are self-employed and believe that they are more immune to ‘jobs for the locals’ types of pressures.

I’ll offer my personal opinion. I suspect that in some parts of the world, notably the EU, Australia and the USA, the idea that protectionism could directly affect the majority of expats living there seems unlikely. Arguing (rightly or wrongly) for trade protectionism is one thing, but using this to discriminate against an expat population is totally different.

In many parts of the above countries and political blocks, the world is essentially ‘global’. Vast numbers of people have upped and moved across national boundaries and there are very large expat communities of various nationalities in virtually every country in the industrialised world. Many expats are now an essential part of the economic infrastructure of the country they live in and it’s difficult to imagine how this could be changed.

So times may get tough and the odd person may ‘sound off’ about jobs for the locals but in reality I suspect that protectionism as such will probably have little effect on us expats. Of course if this is the last blog you ever see me post then you’ll know I was wrong!

Wednesday, August 19, 2009

Expat Tweeters on Twitter - who's your favourite?

Do you follow someone on Twitter who has something interesting to say about life abroad? Do you yourself tweet about life as an expat?

Now that Expat Focus has finally jumped on the Twitter bandwagon - and I can see what all the fuss is about! - I thought it might be useful to put together a list of everyone's favourite expat tweeters...

More here

Tuesday, August 18, 2009

Professional fees in a recession - expats beware!

One of the advantages of having a blog is that it permits one to ramble on about anything that catches one’s attention. I always try to keep to the subjects related to expats and their affairs (of the non-romantic sort of course!) but I’m not sure I’ve done so in this case – but here goes anyway!

I have noticed recently how the prices of some things continue to rise even though there is a recession on across the globe. Food and some commodities do so in most countries and this is blamed on global supplies. OK, perhaps believable.

What I am less clear on is why some professional services costs are also rising in some countries. While the papers across the globe talk about mass layoffs, wage cuts, bonus reductions/eliminations and the ‘new harsh reality’ that people must learn to live with, at the same time lawyers, surveyors, accountants, architects, auctioneers, dentists and assessors, are all putting their hourly rates and fee charges up. Does this make sense to anyone? I ask because many of these categories of people are those that expats rely on very heavily when moving into or out of their new countries.

I don’t know if this is a common perception around the globe (comments gratefully received!) but in several European countries it seems to be so. I have yet to see any widespread discussion of this in the media but at least one person in the above categories recently ‘explained’ this phenomenon by saying that he’d had to increase his fee percentage as his overall volume of business had fallen due to the recession and he needed to keep his income levels up.

Pardon me? As there were now fewer customers around he had to charge those he had a lot more to keep his income level up?

I have actually seen a similar explanation elsewhere and when reading these I started to doubt my own sanity. How can this be sensible or justified? If a supermarket loses 10% of its customers to another or just because of a recession, do they put up all their prices by 10% to compensate for the lost income? If they did, what would they expect the result to be? How is it that some categories of professional seem to be immune from the law of nature that states prices should come down in a recession rather than go up?

The trouble is that many of these professions are guaranteed a role in aspects of life by the law. There are many things that cannot be legally completed without the intervention of these parties. You may not be able to put in that window without planning permission, and in some countries that means mandatory certified architect’s drawings. House moves usually require the high cost services of a solicitor or Notaire (sometimes both). In most countries a qualified accountant is mandatory for all but the tiniest of businesses and their accounts. Etc etc etc.

As a result, one can’t really ‘do without’ their role and the law protects their business and function in effect. Worse, in many countries these professional groups operate what are in effect pricing cartels. Shopping around can be useless in terms of finding lower fees.

As I said, expats are particularly vulnerable to high costs in these areas. This is not only because of house moves but also because many expats purchase property overseas and are obliged to use the services of architects and surveyors and so on – sometimes even for minor renovations. A high percentage of expats are also self-employed compared to national norms.

What can we do about this? Probably nothing – but sounding off is sometimes therapeutic!

Sunday, August 09, 2009

We like to move it, move it!

I couldn’t help but take notice of a recent news report that contained statistical projections from both the UN and EU. Any article headed up ‘latest statistical projections’ usually has a soporific effect but this one was interesting.

To cut a long story short, the two bodies have projected that by 2050 the UK will have the largest population of any EU country (assuming by then Russia hasn’t joined I guess). The figures being talked about were around 80 million.

The second statistic said that a large proportion of this population growth would come about through immigration. Apparently the forecasters believe that the UK will remain the most popular EU destination for immigrants, both those originating from other EU countries and those from outside of the EU.

Fascinating stuff but the first thought that struck me was how this related to another recently published statistic that up to 1/3 of the UK population is actively considering emigration from the UK? If we take this two together, the potential population movement is incredible.

Maybe my maths are faulty but very roughly speaking…at the moment there are around 60 million people in the UK. If over the next say 30 years roughly 1/3 are planning to leave and actually do so, that’s about 20 million people outbound. That would give a net population of 40 million left. For this to grow to 80 million, that means over 40 million people will need to move to the UK over the same period.

Now certainly I know that doesn’t take into account population growth etc but even so, it is a phenomenal population movement out of, and in to, one very small group of islands. In theory it also means that around 60 million people will be going in or out of the UK over the next few decades – and that excludes normal business and holiday travel.

As with all these statistics, there is a very high chance that they are wildly over-estimated and future guessing is a dangerous business. If you look at similar projections in the 1960s and 1970s, had they been right I would be writing this blog now from Lunar City central and discussing the expat situation on Mars.

Yet when reading these figures and thinking about it, a few slightly irreverent thoughts came to mind if these figures are even only partly right.

A) There are going to be a heck of a lot more expats around in future
B) This might be a good time to start a transport and removals business
C) Given that UK government statistics also show that the UK population continues to drift south towards the south-east and south west (e.g. the population of Scotland continues to fall) AND most stats show new arrivals also head to the south east and west, the UK’s going to be in danger of tipping up!

It just goes to show how global and mobile the world is becoming. There may be no new frontiers left but as people are people, the grass will always looks greener. These population movements could mean that one day the majority of people on this planet are odd thought!

Saturday, August 08, 2009

New expat guide to Florida now online

The Expat Focus guide to expatriate life in Florida is now online at:

Tuesday, August 04, 2009

Expats forced to play the property waiting-game

I guess that many are getting tired of watching the value of their house decline. It doesn’t seem to matter much where one is living these days, the property market globally is stuck and retreating. There are of course a few exceptions still. Some city centres and a few property hotspots on some coasts are still just about holding their own, but there’s no doubt that times are tough.

The news is of course full of the various facts and figures, almost all depressing, but there is another aspect that is less frequently talked about.

Having negative equity in your home is of course a serious problem and I’m not suggesting otherwise, but the general stagnation of the property markets globally also carries with it a more all-pervasive logistical problem.

That is that many potential expats can’t make their long planned moves overseas because they can’t sell their home to finance the move. I know of a number of expats who bravely made the move to rented accommodation overseas pending the anticipated sale of their old house sale and are now stuck as their old house ‘back home’ is essentially un-saleable in the current market. This is hitting their finances badly as a lot of money is being sunk into ongoing rent they had never planned for. Some have now rented their old properties out which is good insofar as it generates income but it doesn’t allow them to liquidate their asset and use the capital to buy the home of their dreams in their new country.

This logjam is also starting to hit business. Although this is not just an expat issue, I also know of some expats who desperately need to sell up and move home within their new country for business and professional reasons. Needless to say, they can’t and this means they sometimes can’t take up that new job, position or opportunity – or if they do they have to leave their family behind. One expat recently told me that where he lives (France) it isn’t even a question of price; there are just no property buyers around at all - at any price.

Like just about everyone else including many self-appointed ‘experts’, I don’t know what the outcome of all this will be. I’m a natural optimist and I take some consolation from the fact that many past recessions seem to sort themselves out after a year or two. In some countries the recession also seems to be at least a little less serious than in others so perhaps they will be the countries that will first start to show evidence of an upswing in everything, including property prices and dynamics.

We can but hope!