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A Guide to Buying Overseas Property

Managing exchange rates and risk is an important factor in all overseas property purchases

The motivations for buying overseas property can vary considerably, although one common reason is that it could seem undervalued and therefore likely to appreciate in future. For example, if your local currency is particularly strong relative to that of a foreign country, the cost of buying overseas property can seem especially inexpensive, and could present a lucrative real estate investment opportunity over the long term.

Saving Money on Mortgage Payments

When transferring funds denominated in your domestic currency to either make a payment in full, a down payment, or a series of smaller mortgage payments, you will probably want to find a better foreign exchange solution than simply using your regular bank.

Typically banks provide poor forex services, which often involve very wide dealing spreads and limited transaction sizes. Fortunately, you can usually do much better by transferring your money through one of our partner providers in our comparison tables.

Preventing Exposure to Currency Movements

Foreign transfers related to overseas property purchases are typically for larger amounts at a fixed settlement date in the future.

Therefore you need to be aware that any currency movements of just a few percent can have a large cost to you when you come to settle.

You should consider using one of our BER partners specialising in foreign payments who can advise you on Forward Exchange Contracts that allow you to lock in a rate for some or all of your transfer. A forward foreign exchange rate is the exchange rate at which one currency can be exchanged for another currency for settlement on a predetermined future date (maturity date).

David Brown Author: David Brown

David has extensive experience in foreign exchange markets after multiple roles at investment banks and fintech startups in London and Sydney. He founded the BER platform with the goal of providing Retail and SME customers access to the same exchange rate transparency and competition previously only available to larger institutions. BER is now the leading specialist FX comparison website in Australia and a growing list of countries.

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