One key difference from buying in your home country to buying an overseas property is that your budget will be subject to fluctuating exchange rates. With the assistance of our trusted partner, Smart Currency Exchange, you will be able to mitigate this risk.
At SnowOnly, we've broken down the ski property purchase process into four manageable steps to help you achieve your dream of owning a ski home. In our previous articles, we explored how to find the perfect property and secure the right financing through our network of mortgage specialists.
Now, we turn to the third crucial step in your purchase journey: managing currency exchange. This often-overlooked aspect can significantly impact your purchase price and ongoing costs. As part of our commitment to making your property purchase smooth and stress-free, we've partnered with currency exchange specialists who understand the unique needs of ski property buyers.
The impact of fluctuating exchange rates when you buy abroad
Throughout the year, exchange rates can move by up to 10%. They are impacted by socio-economic events like wars, elections (cough cough the US and the UK in 2024), interest rates. As such, as much as experts may try, they are hard to predict.
The impact of these fluctuations on your international property purchase can be profound. In the time that it takes you to complete the four steps of buying, from searching online to completing on a home, exchange rates can move against you. For example, you could pick out a gorgeous French chalet for €1,000,000. Then, due to an event beyond your control, the GBP-Euro rate moves from €1.15 to €1.10. Now, your ski chalet costs an extra £39,000.
Forking out that extra sum is bound to be painful, and for some, it could mean abandoning your plans entirely. We’ll hazard a guess that it is not the kind of risk you’d be willing to take if you were upgrading to a different property in your home country. Fortunately, there are solutions to this, so you won’t have to lie awake wondering if a surprise interest rate is going to threaten your ability to complete on that gorgeous French chalet.
Our partner, Smart Currency Exchange
We offer free consultations to anyone keen to buy a ski property. We are able to connect you with a reputable estate agent, developers, financial experts and currency specialists, Smart Currency Exchange.
In 2024, Smart Currency Exchange celebrated twenty years of assisting with overseas transactions, with a speciality in property purchases. They are also expert at handling the typical transactions that you will have to pay after buying, like bills, taxes and maintenance.
Why use Smart Currency Exchange
You may have thought that you would simply turn to your bank to handle turning your pounds into euros. However, there are many reasons that we recommend using a specialist over your bank. Here are just a few…
- A personalised experience: Smart Currency also offer a free consultation. Once you sign up, you will be assigned a personal account manager. They will chat through your plans, budget and appetite for risk. Your personal account manager will be reachable over the phone, avoiding lengthy email chains and hollow chatbots.
- Up-to-date market analysis: Keeping up with the impact of socio-economic events on currency fluctuations is a full-time job – so, you can rely on your personal account manager to do that for you.
- Safe and secure: Understandably, you may be anxious about trusting Smart Currency Exchange with your ski home budget. Rest assured, Smart is authorised by the Financial Conduct Authority and UK financial authorities. Plus, if you want to know how their average customer feels, they have a 4.9 rating on Trustpilot.
- No hidden costs: If you use a bank for a currency exchange, they may well jot up transfer, receiving and intermediary fees. Smart Currency Exchange does not charge for transactions over €3,000.
How Smart Currency Exchange can protect your budget against currency fluctuations
Smart Currency Exchange offer a forward contract, allowing you to lock in an exchange rate for up to twenty-four months. Consequently, currency rates can fluctuate, and the amount you will pay for your property will remain the same.
We advise reaching out to Smart Currency Exchange for a conversation early on in your property journey. At the very latest, it is a good idea to have made contact before you head to the mountains to view properties. Typically, the account manager locks in the exchange rate after the offer is accepted. From offer accepted to keys in your hand, it can take three to nine months. However, this is longer in the case of new builds, where a process as long as two years is common. Many chose to marry up the date their forward contract ends with completion.
If there is a particular exchange rate best suited to your needs, your account manager can keep an eye and let you know when the best time to lock in is.
Managing currency exchange after you buy
Smart Currency Exchange can offer services once you’ve bought, too. One is a regular payment plan, this can cover ongoing costs like a mortgage, pension and school fees. Meanwhile, spot contracts are useful for making a transfer within the next 48 hours. Your personal account manager will be able to advise on the solution best fit for your needs.
Next time we will be covering the legal process of buying a ski property, including the role the Notaire plays.
If you would like a clear breakdown of the four key steps to buying a ski property, you can download our guide to the 4 steps to securing your dream ski property.
