A year ago your property would have cost you 10% more with the exchange rate and at least 10% more due to the tremendous value we now see in Spain and Portugal.
Property prices overseas are now heavily discounted and the GBP-EUR rate is 11% higher now than this time last year…… If you have been holding off then now may be a great time to take the plunge as you are saving both on property prices in Euros and of course the currency conversion.
The Sterling Euro rate had been down at 1.10 at the start of July 2011 and many people do not even take this into account during the early stages of buying a property overseas.
The key to a savvy property purchase is considering all the direct factors that may affect the cost and putting together a plan of action.
Currency exchange is one of the more volatile matters to address and there are many options available to you once you have agreed on a property to protect yourself from adverse market movements inclusive of a forward contract, stop loss order or a limit order.
Just imagine, if you bought a property for a certain price for example €120,000 and the currency market was at 1.20 it would initially cost you £100,000.
Should the market move against you and rates are at 1.16 by the time completion comes around suddenly the property is costing you £103,448.27 (An extra £3448.27!). Just think would you have agreed to pay more than £3000 more when you signed for your property – probably not.
Also that £3448.27 could be used to pay for your furniture or fees – Now you have to find the money from other sources.
Using a dedicated currency broker can actually save you thousands of Pounds both in terms of assisting you along every step of the way from getting over your deposit to paying for completion and from sending over money for building work to bringing back currency should you ever sell. A good currency broker will also get you a much better rate of exchange than your bank in a secure and efficient manner.
If you do have a pending property purchase either or indeed you are looking to sell overseas in the coming months then it is worth having a discussion with me at Foreign Currency Direct. You can explain your circumstances and I will be able to put together a plan of action with you as to how to combat what is an extremely volatile market.
You can email me directly on email@example.com or call me directly 01494 787 462 please mention ound Euro Exchange and I will be more than happy to assist you and secure a great rate and give you specialist advice.