Exchange Rates and Property

There are several reasons for doing this, but most importantly, now seems to be an opportunity not to be missed to take advantage of the relative strength of the against the Euro.

Even during the last few weeks, we have seen clients affected by the steady reduction in value of the . One client's purchase has not proceeded as a direct consequence of the demise of the pound. At an exchange rate of 1.62 their dream home would cost in the region of 350,000, but at a reduced rate of 1.55, it had increased to 366,000 and all of their associated fees had increased as well. They had to opt out of the purchase because they had failed to take our advice to lock into the currency in the preliminary stages of their property search.

There is daily comment in the tabloid press about Britain entering the single currency, and it is widely acknowledged that to do so upon suitable terms, that must weaken against the Euro, which in real terms means that the cost of a house in France goes up. Don't wait for the inevitable to happen and then say, if only I had fixed the currency

It also surprises me that, after negotiating hard for a reduction in purchase price, that so many buyers then arrange their currency via their own banks, who promptly provide them with inferior exchange rates, charge higher fees for transmitting the currency, and overall do a pretty average job. I prefer our clients to use a professional exchange dealer, hence our association with Foreign Currencies Direct, who have given us 2 dedicated dealers (Peter Ellis and Robin McEwen), both of whom write regular articles for the French Property press.

Even better news for our clients is that by quoting our business relationship to the dealers, you will receive preferential exchange rates, simply quote Allez Fran�is or the reference XAPE (imprinted on the attached form).

One of the best recommendations that I can make is to confirm that we use Foreign Currencies Direct for all of our personal and business transactions. To date, we have enjoyed a 100% success rate getting money into the Notaire's bank accounts on time without any problems and everyone of our clients has been complimentary about the service.

Please call FCD on the numbers given below or complete the online form, which will open an account for you with no obligation to use the arrangement. It is merely getting everything in place for when you decide to proceed, by which time you will have a hundred and one other things to remember. Even for clients who have made the move to France, we still advise the account, it is quicker and more cost effective than using your French bank to transfer money back and forth.

Help yourself by taking up this facility now!

How It Works

Foreign Currency Direct is a simple straightforward solution for all commercial Foreign Exchange requirements. To utilise the service you will have to register by submitting your name, address, contact numbers, date and signature on the application form. This process takes just minutes and can be done online. Click here to view the form (PDF format / 50K) . using the form attached. Once your completed document is received, credit control will allocate a personal account reference and number. This will entitle you to buy or sell currency over the telephone without putting any money "upfront".

FCD do not charge any fees or commissions for the service. All transactions are sent via priority telegraphic transfer and on sums over 50,000, funds are transferred free of charge, (under 50,000 a flat fee of 15.00 is included.) Payment in settlement can be made by cheque, bankers draft, bank transfer or same day transfer.

If you are intending to buy a property in France later this year, or indeed, the next, you may have concern about the future strength of Sterling (GBP). There are two ways to purchase currency, Spot and Forwards. A Spot contract secures a currency with a view to take delivery of, or have the currency made available within two days. The funds are available for immediate delivery upon receipt of the clients cleared funds. We also have the facility to hold the funds on account until you are ready to pay them away. However, clients of Foreign Currency Direct can protect themselves against the uncertainty of adverse exchange rate movements, and in this respect a forward contract may be worth considering. This is particularly useful in cases where a purchase or completion is not immediate, or if there is a requirement to make several payments in the future.

In general terms, a forward contract can be utilised to guarantee that currency can be bought or sold at a predetermined rate for anything from three days up to two years ahead. In the case where the specific dates are uncertain, the same principle can be applied by employing a time option forward which allows the currency to be accessed or drawn down, in full or in part, as and when required between two agreed dates.

It is important to remember that the further forward a contract is fixed, the greater the premium that will be applied to the current exchange rate, as the contract allows you to buy time and takes into consideration interest rate differentials. A deposit of good faith is a market prerequisite, however the balance is not due until the final maturity date.

Most buyers of foreign property will need to pay an initial deposit with stage payments and/or balance upon completion. Securing and thereby guaranteeing their exchange rates through next year leaves the buyer in no doubt as to the eventual cost of the French property and eliminates future exchange rate worries.

Top 20 Additional Properties