If you’re planning to sell a property in the UK in order to fund your international property purchase, recent developments may have an impact on how much you have to spend. However, with the right support it is possible to make your international property purchase smoother and more cost-effective…
With an unexpected general election on the way, experts expect to see the UK housing market come under increasing pressure, even if the result of the election provides greater clarity over Brexit.
The Royal Institute of Chartered Surveyors (RICS) recently noted that the number of unsold properties per estate agent branch had fallen to its lowest level since it started recording the data, even before this element of increased uncertainty was introduced to the market. As a result, weakening demand means house prices may struggle to maintain their recent growth, even if expectations point towards further increases thanks to the relative scarcity of housing in some areas.
If house prices do indeed start to ease this could put a squeeze on the budget for your international property purchase, making it more important than ever to make sure you secure the most competitive exchange rate possible when sending your funds abroad.
The discrepancy between the rates you could achieve with different providers could amount to thousands. Transferring your money at a weaker rate could limit your potential to climb the international property ladder, while a better rate would give you more money to play with.
Exchange rates offered by banks are often not the most competitive, so it’s well worth approaching a currency transfer specialist to see how they compare. While a dedicated transfer provider would offer you an excellent exchange rate (giving you thousands, or even tens of thousands, more to spend on your property purchase) they also offer additional services which could make your international buying experience smoother.
Some currency transfer providers offer a forward contract service, which allows you to lock in the current exchange rate for as much as a year. With a forward contract in place it won’t matter if the market moves against you in the weeks or months between making an offer on an overseas property and needing to make the transfer. As well as protecting your hard-earned funds from the unpredictability of the currency market, this approach will provide you with increased peace of mind.
A forward contract can also be useful for establishing your budget in advance of your purchase, making sure that you can still afford your perfect property no matter what the exchange rate does in the meantime. While you will probably have to pay a small deposit upfront to secure the rate, this could be a wise course of action considering the uncertainty of the current political and economic climate.
With the Pound likely to come under fresh pressure ahead of the UK returning to the polls on 8th June, exchange rates could see some significant shifts in a short space of time, so a proactive approach is crucial if you want to secure yourself the best rate possible. In this volatile atmosphere you could also benefit from the guidance of a personal account manager (a service offered by some specialist providers).
Buying a foreign property can be a stressful experience, but a currency transfer provider can provide you with invaluable support and access to the best services for your needs.