Buying with certainty

Fluctuating exchange rates can be a nightmare for the British buying property in France. Luckily help is at hand – for those who know where to look


For millions of us Brits, owning a holiday home in France is a long-cherished dream. The appeal of French food, wine, culture and the lifestyle is so great that a remarkable 200,000 British people have bought homes in France.

With the opening of the Channel Tunnel almost exactly 20 years ago and better transport links making France even more accessible than ever, plus a buoyant lettings market, the trend seems set to continue.

Part of the appeal of France as a place to buy a holiday home is its variety. The most popular areas remain the Charente and Dordogne with their traditional farmhouses and châteaux. The Languedoc, stretching across the south coast to Provence, offers higher-end beachfront properties while the Alps have long been very popular among British buyers and holidaymakers. Normandy and Brittany, meanwhile, are the places in which to find spacious, traditional farmhouses offering better value and closer proximity to the UK.

But buying a property in France means paying out for a number of charges and costs, and of course, it involves the unpredictability of the currency exchange rates. As a result, the price that you agreed with a vendor can vary as sterling fluctuates daily against the euro. So, given this uncertainty, how can buyers keep to their budget? Traditionally most of us have looked to a bank for help.

However, a growing number of canny property buyers are discovering more cost-effective ways of transferring their money – and this often involves using a currency specialist. For many of us the Moneycorp name is a familiar and trusted place to get our holiday money as we travel through the airport. But more and more people are discovering that the UK’s leading currency exchange provider, which has been in the business since 1979 and now has around 70 bureaux de change across London and the UK’s major airports, can also help them buy their dream holiday home in France or almost anywhere else in the world, for that matter.

“Here at our head office we’re very much focused on delivering a seamless, cost-effective and efficient international payments service for businesses and people,” says Moneycorp’s Tanya Uniacke, country manager – France. “Most of those individuals are looking to fund property purchases abroad. For France alone, for instance, in 2013 and so far in 2014, we’ve already registered over 2,000 people who are either buying a property or moving to the country.”

Currently, given the strength of the pound against the euro, France offers great opportunities for both property buyers and holidaymakers. As experts in currency exchange, Moneycorp will be watching with particular interest to see whether this favourable rate continues.

“With sterling currently sitting at a 22-month high against the single currency, it is clearly a great time to be buying euros. Investors like the pound because they like the UK economy and they like the prospect that sterling interest rates will start to move higher before euro rates head in that direction,” says David Kerns, private client dealing manager, at Moneycorp.

More and more people are discovering that Moneycorp can help them buy their dream holiday home in France

“On the other hand, European Central Bank president Mario Draghi continues to remind investors of his announcement in early June of the ECB’s intention to keep interest rates low ‘for an extended period’ as part of the attempt to reunite the eurozone’s 0.5 per cent inflation rate with its 2 per cent target. The eurozone may have exited recession, but growth for 2014 remains dire and unemployment stubbornly high at 11.6 per cent.”

What happens to the euro-sterling exchange rate remains to be seen. However, one thing is certain – it’s essential to have an expert such as Moneycorp that can help you fix rates for up to two years, taking advantage of current levels, and explain the details in simple language, working with you to make sure you get the most for your money.

SWIMMING POOL OR NO SWIMMING POOL?

Imagine that you want to buy a property in the Dordogne for €350,000. Typically, the buying process takes just over three months from when the offer is put in to signing the “compromis” (exchange contracts) and then to completing the “acte de vente” (completion).

Three months ago the sterling-euro exchange rate was just under 1.21. Three months later, on July 7, it was comfortably over 1.26. Happily that has just made this house purchase of €350,000 less expensive by a massive £11,500, simply by getting you an extra five cents for every pound.

But what if the exchange rate moved the other way? If it fell then you could be faced with paying an additional €15,000 for no reason at all. You could even have to give up the purchase, or at least give up on the prospect of buying a car or installing a swimming pool.

Typically, rates offered by Moneycorp are 3 to 4 per cent better than those offered by high street banks.  In addition, banks may charge an international transfer fee, usually around £40, and offer little or no assistance with making the transfer.

Property buyers need partners who are experts in currency exchange. This is why buyers are increasingly coming to Moneycorp. “You’ll be offered a competitive exchange rate, but more importantly you’ll be assigned a dedicated contact to help you make the transfer at the optimum moment within your time frame based on expected rate movements and historical trends,” says Tanya Uniacke of Moneycorp.

For more information about Moneycorp contact: Tanya Uniacke Tel: +44 207 828 7000 or e-mail: france@moneycorp.com