Buying property in Portugal? Your exchange rate could make a substantial difference.

Buying property in Portugal? Your exchange rate could make a substantial difference.

Buying property in Portugal? Exchange rates can make a significant difference to your final purchase price. Learn how favourable currency movements and expert guidance from Lumon Pay can help international buyers save thousands on their Portuguese propert

Published on

For international buyers, the price agreed for a Portuguese property is only one part of the final cost. The exchange rate used to convert pounds or dollars into euros can materially increase or reduce the capital required to complete the purchase.

For example, last week, the US Federal Reserve decided to hold its interest rate, as did the Bank of England. These types of decisions, and the guidance accompanying them, could have moved both sterling and the dollar against the euro.

Current developments have been broadly encouraging for international buyers. Sterling recently reached its strongest level against the euro in more than a year, while the dollar has also remained relatively firm. The pause in military strikes between the United States and Iran has helped oil prices fall, reducing some of the immediate inflationary pressure affecting currency markets.

What could this mean for your purchase?

A 3% movement in the exchange rate can change the cost of buying a property by approximately:

€500,000 purchase: €15,000
€1,000,000 purchase: €30,000
€1,500,000 purchase: €45,000

The property and agreed price remain exactly the same. The difference is simply when and how the currency is converted.

A favourable exchange rate could provide additional purchasing power, reduce the capital required for completion, or release funds for taxes, furnishings, improvements or other acquisition costs.

Protecting your property budget

PortugalProperty.com works with the experienced, highly regulated provider, Lumon Pay, to help international clients manage the currency element of their Portuguese property purchase.

Depending upon your circumstances, it may be possible to secure an exchange rate in advance for funds required at a later date. This can provide greater certainty between agreeing a purchase and completing it, rather than leaving your final cost exposed to market movements.

For a complimentary, no-obligation conversation, please contact us:

Published in: Money / News and Updates / Property