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If you are looking to buy or sell a property in France, one of your considerations should be how you’re going to transfer your currency, as the difference in exchange rates can really make all the difference to the amount this will actually cost you. Some buyers and vendors automatically assume that using their bank is the easiest and cheapest way of doing this, however this often isn’t the case.
Foreign Currency Direct transacts in excess of half a billion Pounds per year and as such this gives far more buying power than an individual would have when purchasing currency. In addition to the savings that you could achieve on your currency exchange, our service is extremely personal and you will have one point of contact here throughout your dealings with us. Your account manager will take the time to get to know about your plans, and use their expert market knowledge to keep you up to speed with exchange rate fluctuations so that you can make an informed decision when to perform your transaction. Our traders have been with us on average for over 8 years, and you can use their vast experience to help you navigate the French buying and selling process, whilst helping you best time your currency exchange.
Not only are we able to offer extremely competitive rates of exchange when compared to the high street banks, but we also understand the nuances of the French property market. Having helped thousands of clients to buy and sell properties in France, we are perfectly positioned to organise the transfer of your currency. We can also send payments directly to your Notaire for your property purchase, or funds can be sent directly from a Notaire to our French Euro bank account following completion of a property sale, all to help you to avoid potential bank charges.
Foreign Currency Direct are authorised by the FCA as an Electronic Money Institution, so you can be safe in the knowledge that your money is being handled responsibly, held in segregated client accounts which are used to keep client funds and company funds completely separate.
We also offer a number of contract options designed to help you to capitalise on favourable exchange rates. A forward contract for example allows you to purchase currency in advance, so that if the exchange rate falls you are safe in the knowledge that your currency is already secured. This can remove the risk of market volatility which could impact your return significantly, while you wait for your property completion.
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The pound continues to remain under pressure and has begun the month of July close to the lowest levels to buy Euros in almost 3 months, with the Interbank level hitting 1.128 on 2ndJuly. The EU Summit which took place at the end of last week caused the Euro to strengthen against the Pound and US Dollar, amongst a host of other major currencies. This Euro strength was put down to many EU members edging much closer to agreeing on how best to deal with the current migrant crisis.
UK economic data has been relatively poor of late, with GDP (Gross Domestic Product, a key barometer of economic Growth) figures being released at just 0.2% last month. To put this into context, the Growth rate in the US is currently at 2.2%.
There was, however, some respite for the Pound in June when one more member of the Monetary Policy Committee than at the previous meeting voted in favour of a hike in Interest Rates. The currency markets reacted positively to this news, as although rates were left unchanged at 0.5%, this sparked further speculation that a rate hike could be seen in the near future - potentially at the Bank of England’s next meeting in August.
However the main topic keeping Sterling’s value pinned down is Brexit. Discussions haven’t really made any progress for some time, when it had been hoped that this would be a priority discussion point at the EU Summit. Teresa May is expected to release a White Paper during a cabinet meeting on Friday 6thJuly at Chequers, which could be make or break for both Brexit and also her leadership. Mrs May has had a constant struggle recently in trying to get her party to agree to key issues, and a divide has been growing for some time between those who want a hard Brexit, and those who are pushing for a soft Brexit. If Friday’s discussions don’t go to plan, a vote of no confidence could potentially put her leadership in jeopardy, and would almost certainly be Sterling negative if this were to happen.
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David Morley describes his move to France over 10 years ago
Planning retirement in our early 60s, we were looking for a substantial family home, somewhere in a truly ‘fun’ part of France. We quickly discovered that the Provence, made famous by Peter Mayle’s books, was sadly no longer what it was and, after further research, we thought that it was the South West of France that now had so much more to offer.
We needed a strategic location with easy access to international airports and high-speed trains and road routes. We wanted a peaceful setting that was private but not remote, somewhere close to outdoor opportunities and cultural facilities into which we could dive for inspiration! The Aveyron Gorge seemed to fit the bill so off we headed for a look.
Right at the point where the mighty River Aveyron enters its beautiful limestone gorge, we found the charming village of Bruniquel, described as being one of the finest in France. Two chateaux perch precipitously above the river valley dominating the village’s medieval cobbled streets providing mystery and intrigue. Beneath them lies a cavern concealing the oldest evidence of Neanderthal man dating back some 175,500 years!
Nearby an ancient, stone-built presbytery in a delightful calm country setting was seen to have huge potential, a euphemism for its demanding complete and immediate restoration! Here it was that our adventure started over ten years ago. All around us there was so much going on and we quickly made many English and French speaking friends, all the more amazing since I spoke almost no French at all when first we arrived!
Now restored and resplendent, this fine property is for sale and with it comes a lovely lifestyle and much potential (if such were to be desired!).
Read more about David's beautiful house, La Verrouille, here:
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The beginning of April showed some really positive signs for the UK economy and therefore GBP/EUR rates, as Average Wage Growth and Unemployment figures impressed, highlighting the lowest unemployment levels seen in 43 years. However, Sterling came under increased pressure towards the end of April as the chances of an Interest Rate hike at the Bank of England’s next meeting in May rapidly diminished. A wave of poor economic data from the UK, including Inflation and Retail Sales figures disappointed during April, which was rounded off with the worst Gross Domestic Product (GDP) figure announced since 2012, falling to just 0.1%.
This shift in sentiment has meant that GBP/EUR Interbank levels have fallen by 2.3% over the last month, meaning that a £250,000 transfer in to Euros would now achieve €6,500 less than it would have at the middle of April.
As such, Economists are now predicting that the Bank of England will not make any changes to monetary policy at their next meeting on Thursday 10th May, and one of the UK’s largest Banks have predicted only a 20% chance of a rate hike at this meeting. This could mean that the Bank of England could either wait until August, or some economists are even predicting no change at all this year. It will be really interesting to see whether the Bank of England surprises the markets by raising rates in May, but if they do choose to hold off I would expect GBP/EUR to fall considerably. The minutes released shortly afterwards could provide clarity around their next moves, and will likely be a key mover for GBP/EUR exchange rates. Clients looking to buy Euros with Sterling in the short to medium term could be sensible to transfer ahead of this key announcement, as the current trend is that good news is usually creating small gains, however bad news is creating much larger losses.
Brexit negotiations are of course still ongoing and are also playing a big part in holding down the value of the Pound, in particular the subject of the UK’s relationship within the Customs Union. The divide within the Conservative Party appears to be widening, however hopes are that an agreement on whether the UK stays in the Customs Union is reached by the time of the EU Summit in June.
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…or an apartment, manoir, smallholding, chateau or gite…
Whichever category your French property falls into, or whether it is something else entirely, we want to help you make the most of marketing what can be your biggest asset. So, at the time of year which traditionally signals the start of the property hunting season here are some ideas to help you sell your French property:
Unless you are selling a renovation project it needs to look well maintained, straightforward and easy to run. A buyer must not be frightened off at the thought of costly maintenance, structural problems on the horizon or something that is going to be time consuming or expensive to live in. So:
· Attend to routine maintenance
· External woodwork should be recently painted
· A fresh coat of neutral colour paint inside if rooms look tired
· Outside cut the grass and prune trees and shrubs, and keep them that way
· A load of fresh gravel on the drive or parking area gives the area outside of your house a relatively inexpensive lift
A buyer must be able to imagine themselves living there surrounded by their own possessions, so you want your house to look as light, spacious and neutral as possible.
· Get rid of all of the junk you have been meaning to recycle for ages
· Clean out cupboards, tidy and streamline bookcases and shelves
· Pack away as many personal effects as you can bear to be without
· Neutralise colour schemes and minimise patterns wherever possible
So does the price
It is very hard to accurately gauge the true value of your own house, and well-meaning friends don’t always understand the true state of the property market, so
· get several valuations (you may be very surprised at the variations in valuation you are given). Places to go to for a valuation include local and national estate agencies, notaires (particularly if probate is involved), our own E-valuation service and independent web sites such as www.immoprix.com and www.meilleursagents.com/prix-immobilier/
· if you are dealing with an estate agent, make sure you understand the mandate. Mandates are binding contracts and they vary – has the agent included their commission in the selling price? Are they trying to penalise you if you sell privately? Are they asking for exclusivity? How long are you contractually obliged to use them for and how do you bring that obligation to a close?
· Make sure you are happy with the price you finally decide to put your house on the market at – don’t be browbeaten or flattered into making the wrong decision.
A picture speaks a thousand words
The importance of photographs cannot be overstated. You can get them taken professionally but as a homeowner with a smartphone you can usually do a perfectly good job yourself. Remember – you own the copyright of photographs you have taken or commissioned and can use them as you want. If an estate agent takes them they are theirs – and you need their permission to use them.
· The “hero” shot (or lead photo) is your most important marketing tool. It is the bait that first hooks the fish and so has got to be right for the job.
· Consider your property’s best angle. This need not be the facade…it could be an architectural feature or something which sums up the character and charm of your French home. This is one of our most successful “hero” shots at the moment. The house being sold is a town house in a wine producing region and this picture sums up why many people want to move there:
· The hero shot does, of course, need to be backed up by other photos which tell the wider story of your property but still leave something further to be discovered by an interested buyer.
You need to kiss a lot of frogs…
………before you find your prince.
As a rule, French property takes much longer to sell than British, for example. We do sell property in a month (or two) of taking it onto our books, but everyone knows of property which has been on the market for several years and one to two years is not an unreasonable time to allow for selling your house, even if you have the price, presentation and photographs absolutely right. The fact is that there is a lot of property around and the dynamics of the French housing market are different to elsewhere. To maximise your chances of a sale:
· Make sure you have the correct paperwork to hand and that it is up to date
· Deal with all enquiries about your house for sale promptly and honestly - and keep records of who has seen your house, a summary of their visit and how they found it in the first place.
· Be professional – showing people around your house is a skill and there are tips and techniques which can make a viewing much more likely to result in a sale.
…Be patient – Buyers can take a long time to materialise and then make up their minds. The legal process is slow and can be frustrating. Remember you bought your house didn’t you. And, sooner or later, so will someone else.