Buying a property overseas is a dream for many Britons, and turning it into reality will take a lot of time and effort in finding the right property for the right price, and working through the potential language barriers to get a good deal.
But with property prices in some areas of Spain still around 50pc below where they were back in 2007, and France also offering a wide range of property that is well below the prerecession price level, now could be a good time to buy a home in sunnier climes.
When it comes to buying overseas, getting a great exchange rate is as important as finding a bargain property. The City A.M. International Payments service offers you bank-beating exchange rates that could typically save you as much as 3-4pc on the final price of your property. On a transfer of £100,000, that would equate to a saving of around £4,000.
Buying your property when sterling is at its strongest will make your money go further, but the market is volatile and if you time your exchange badly it could derail your plans to buy abroad altogether. For example, at the end of last summer the pound was languishing at around €1.14, while at the time of writing it was closer to €1.28. So if you had a budget of £300,000 you could get around €384,000 today rather than the €342,000 - €42,000 more just because of the stronger pound.
Of course, exchange rates change constantly throughout the day, and any bit of news that spooks the market could potentially cost you dearly. The most recent example of a significant weakening of the pound was just before the Scottish Referendum vote.
On July 2 the pound reached a 2- year high of €1.26, but a shock YouGov poll which suggested there was a real chance of Scotland voting for independence rocked the markets, and saw2 cents slashed from the value of the pound on September 8, with it falling to €1.24. If your payment of, say, €300,000 had to be transferred that day to finalise the purchase of your property, you would have had to find an extra £3,840 to complete compared to when the rate was at €1.26.
To protect yourself from market movements like this, the City A.M. International Payments service – provided by leading currency exchange specialists Moneycorp – gives you the option of locking in a rate for up to 24 months in advance with a ‘forward contract’ so you can budget for your overseas property with confidence- and these fixed rates are also available for regular payments.
And the fees are also often far cheaper -for example, your bank will typically charge you anywhere from £20 to £40 to send your money abroad, costing £480 a year if you need to make monthly transfers to deal with agents’ fees, mortgage payments and so on. While the City AM service offers free online transfers, rising to a maximum of £10 for a transfer made over the phone.
The currency experts at Moneycorp - which has been trading currency since 1979 and is authorised and regulated by the Financial Conduct Authority for the provision of payment services - will give you expert guidance on your international transfers, so you will be well-placed to decide which of the specialist tools available will be right for you. You can also get up-to-the-minute information on currency markets and any news that is expected to affect them.
Using the online service gives you full access to your transaction history and the ability to move money abroad 24/7, so no matter where you are in the world you can buy or sell any of the 34 currencies available. Payment details are stored too, so you can make regular payments with ease.
So why not take a look at the City A.M. International Payments service to see how much you can save?