Smart property buying: Safeguarding against currency fluctuations

If you are a foreign buyer looking to purchase property on the Costa Blanca, it’s important to understand how currency fluctuations can impact your transaction.

This often-overlooked factor can affect your ability to finalise the purchase.

The property buying process can take several months, during which the exchange rate between your home currency and the euro might change.

Local Currency Variations

Although the property price in euros remains constant from the signing of the contract to the completion, the cost in your local currency can vary.

For instance, if your currency loses value by 3 per cent against the euro, the cost of the property in your currency increases by 3 per cent.

This added expense can be significant, depending on the property’s price.

Currency Exchange Expert

To manage this risk, it’s wise to consult a currency exchange expert before you start viewing properties or signing agreements.

They can help you set your budget in euros and prepare for possible fluctuations in your currency.

One effective tool is a forward contract, which allows you to lock in an exchange rate for the full property price.

This protects you from future rate changes and helps you avoid unexpected costs at completion.