Would you buy a property knowing the agreed price could change between the day you agreed to purchase it and completion day?
Article written by The Overseas Guides Company
You might say ‘no’, but incredibly thousands of people do exactly that when buying an overseas property in a different currency to their own. Why? Read on to find out.
For starters, can you guess how much one of these smart new apartments in Tavira in Portugal’s eastern Algarve costs? The truth is, for too many British people it’s impossible to say simply due to fluctuating exchange rates. It’s a sad fact that many buyers from the UK don’t know until the day they make a currency transfer how many pounds they’ll need to exchange to meet the agreed euro price of their property.
The current asking price of this one-bedroom property, on a development in a quiet area of Cabanas just 300 metres from the beach, is €140,000 (for more details contact OGC on 0207 898 0549). So here we demonstrate how the actual price in pounds to British buyers fluctuated at various points over just three months, thanks to nothing more than exchange rate movements – the rates shown below are the approximate rates that Smart Currency Exchange offered. The result is by a hefty £6,377 – enough to cover the cost of some refurbs if you were to buy the property!
| Date | Approx. Smart £/€ rate | Property price |
| March 27 | 1.1770 | £118,946 |
| March 20 | 1.1604 | £120,648 |
| February 27 | 1.1468 | £122,079 |
| January 27 | 1.1610 | £120,586 |
| December 27 | 1.210 | £115,702 |
The good news is, you can eliminate the effect of fluctuating exchange rates on the cost of your overseas property purchase. Using Smart Currency Exchange to make all your currency transfers is the first step to making your pounds go further when buying abroad – thanks to their bank-beating exchange rates. Speak to Smart today though, and they’ll reveal how a forward contract could help you fix the cost of your overseas home in pounds, before you have to pay for it in a foreign currency. Alternatively, visit the Currency Zone or download Smart’s 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