It’s seems unfair, but it’s something anyone buying overseas property should be prepared for… We’re talking about overseas property recently going up in price for British buyers, thanks to nothing more than exchange rate movements – despite the price of property in its local currency, such as euros or dollars, staying the same.
Article written by The Overseas Guides Company
If you’re searching for a property in Spain, France or another Euro country, or perhaps in Florida, and your funds are in pounds, you’ll be only too aware how your spending power has weakened since the start of the year. On January 1, 2013, the exchange rate was £1/€1.231, so a €150,000 property was worth around £121,850; on March 6, that property’s Euro price is the same, but in pounds its value has risen to around £129,530, solely due to the exchange rate shifting to £1/€1.158.
The good news is that there are ways to minimise the effects of a poor exchange rate on your money, starting with contacting a company that specialises in making foreign currency bank transfers – such as Smart Currency Exchange. During periods when the pound is weak, you need every penny to count when you’re exchanging pounds into euros or dollars – firms like Smart Currency Exchange will do this for you by offering far better exchange rates than your high street bank, typically 2-4 per cent better.
Opening an account with Smart Currency Exchange would give you direct access to a personal account manager who could give you a quote for a currency transfer, either pounds into a foreign currency or vice versa, at any time. They would then make the transfer to your overseas bank account for you.
The other very effective way they can protect your money when buying abroad – which is especially useful during spells when a weak pound could weaken further – is agreeing a fixed exchange rate to buy a specified amount of foreign currency, which you can action at some point during the next year. To do this, you will be required to pay a small deposit. Called forward buying currency, this means the price of your property won’t change – in both its local currency and pounds – once you have agreed to buy it, as you know you have access to an exchange rate that won’t change.
Using a currency exchange specialist is always advisable for anyone sending money overseas, but given the weakness of the pound and the uncertainty over its recovery going forward, using one in today’s climate is especially advisable.
For more information on how Smart Currency Exchange could save you money when making foreign currency transfers, visit the Currency Zone or download their free report.
The views and comments herein are those of the author and do not necessarily reflect the views or opinions of Rightmove Overseas, Rightmove Group Ltd or Rightmove Plc