Spain is in the Eurozone of course and for many clients of the Spanish Property Network the exchange rate has no effect on their Spanish Property purchase because their country uses the Euro and so do we. However this is not the case for a large percentage of our customers who come from outside the Eurozone; the UK, The USA, Canada, The Middle East, The Far East and more.
Obviously in order to purchase a property in Spain a client needs to make a transfer of funds into the country, usually into a bank account they have previously opened, and then draw a bank draft for payment on the day that they sign to buy their property.
The good news for many of our clients, and we are going to use the UK as an example, is that the Euro has weakened in the last few weeks to levels not seen since 2008 and the financial crash. Against the Pound the Euro hit 1.25 this week. In theory this is good news for buyers but what does it mean in practice? Well in practice it is even better news.
A client of ours is currently buying a property at 325000 Euros in Valencia. If they had made their transfer last week at the 1.22 rate it would have cost them just over 266000 Pounds Sterling. By making the transfer today it will now cost them 260000 pounds a saving of 6000 pounds or put another way 7500 Euros extra has appeared in their account this week to use as they wish.
However, do not think that it is your bank that will pass you on the greatest savings. That is far from the truth. We work with various Currency Transfer companies and they are very keen to save our clients a lot of money and do a much more efficient job than the banks of course. Typically our clients save up to 5% on transfers compared to the banks. One of the companies we work with is Currencies Direct. We are very happy that they now have representatives in most of the areas we cover and even more excited to learn that they can now work with our American clients, something previously not possible, when transferring Dollars to Euros for Spanish Property Purchases.
Remember though that all of your transfers into Spain can be done in this way, your mortgage payments, if you have a mortgage, will be at a much better rate for your monthly recurring payments, that car you have your eye on will also be cheaper if you use a currency company, your bank will not get a high percentage of your pension payments if you are drawing your pension in another currency and transfers back to your home country are also at a better rate. It makes sense, it is usually quicker and because of arrangements in Spain the money coming into your account will not be charged a receiving fee by the receiving bank as it does sometimes when coming from your bank abroad. Click on the image below to be taken to Currencies Direct Homepage and sign up below to get a quote for your transfer. They guarantee to match or beat all quotes you have on transfers into Spain.
One last thing you should also know. Don’t be afraid to ask questions. You can fix your rate against the Euro if you fear that it may drop between when you make an offer on the property and completion, often a period of up to 60 days (Ask about Forward Ordering). This makes your planning a lot easier for paying at the Notary on the day of the signing. And guess what? If the rate goes in your favour in the intervening time you can take the higher rate but you have made sure you have hedged against the rate falling. A win-win situation which most banks will not offer even at their significantly lower rates.
My only question is, why would anyone ever use a bank to make a currency transfer? You lose money, it is slower and there are always extra charges. It makes no sense.