Holiday home abroad

With Brexit uncertainty and Boris Johnson increasingly looking like the favourite to become the next prime minister, British citizens are concerned about the prospect of buying a property abroad. The EU is now hostile towards the Tory leadership campaign rhetoric which fails to confront the reality of the UK’s position in the negotiations, and opposes any further delay to Brexit. Amidst political and economic instability, the decision to buy your holiday home abroad can create considerable stress, especially when you have not set your finances in order.

There are obviously immense rewards, such as getting resident status or a passport, depending on your nationality or the country you are investing in. There will be carefree days in the sun and cool nights sipping your gin and tonic, as cicadas buzz in the distance. But, first, there will be bills to pay, bank accounts to open and funds to transfer from overseas, so being rational and foreseeing certain obstacles will only help you overcome hurdles easier and efficiently.

 

Knowing the law

Owning your own holiday home abroad can be a dream come true, and one that might possibly come with benefits such as a second citizenship, depending on the investment you make. But knowing early on the restrictions to rules and what comes with owning a specific property could potentially save you a lot of pain. It is always safe to get legal opinion on certain aspects of buying a property, including buying a house without title deeds, which can be a nightmare.

 

Getting a loan and property taxes

Dealing with your finances early on and finding out whether you can get a mortgage in another country is probably a good beginning, if you are trying to get things in order. As a Washington Post article clarifies, “Unless you have enough cash on hand to buy the house, you’ll be requesting a loan from a foreign bank — and it probably won’t be as easy as working with one back home.” For example, foreign banks might lend less of the total value, while there might be the financial burden of additional taxes. According to the Washington Post article, “Regardless of where you buy a home, you’ll likely be on the hook for extra taxes. Spain levies a 10 percent sales tax on real estate….Nonresidents buying in Italy have to pay about a 9 percent tax on the value of the land. On top of that, there can be ongoing property taxes.” Figuring all this out, could save you a lot of time and money.

 

Costs and Renting

From tax bills, utilities and various maintenance costs, you could be paying significant costs that can be offset by the decision to rent your home, which can be potentially profitable. But earning an income, will also be coupled with taxes, and you would need to know in which country you are paying those taxes.

 

Know and secure your rights

Depending on whichever country you are and the laws regarding owning property, many professionals specialising in tax compliance and consulting recommend that your property is listed as part of your estate and that you file a will in both countries of residence. According to certain countries, “if you don’t have a will [your home] could go to the closest relative you have in that country, which may not be where you intended it to go.”

When it comes to buying your future holiday home, you will be considering, for a large part, your financial situation and ways to navigate the complexities of a volatile market and transferring funds abroad. Universal Partners FX can tailor specific solutions to help you transfer large amounts of money internationally. From mitigating the effects of currency volatility, to providing access to the best exchange rates, UPFX can deliver the most optimal prices at the most opportune time.

 

Find out what UPFX can offer you, by talking to one of their experts today.

Buying property abroad

With no-deal Brexit being on the table again, is this the right time to buy your property abroad?

Former cabinet minister Oliver Letwin was behind cross-party efforts to block a no-deal Brexit. The Labour-led attempt to eliminate the possibility of crashing out of the EU without a deal was defeated by 11 votes, after 13 abstained and eight more Labour MPs voted with the government. Despite the efforts of 10 Conservatives who rebelled by voting against the government, the option of a no-deal Brexit is back to haunt us.

Letwin, disappointed, said that the parliament was now out of options to protect the UK from a hard Brexit, after the defeat of Labour’s motion. Talking to BBC Radio 4’s Today programme, he said: “We have run out of all the possibilities that any of us can at the moment think of.” Letwin added: “If the government doesn’t bring something before parliament, parliament won’t have a chance to take a view on that.” For him, it was impossible that Tory MPs would vote against the government to prevent a no deal scenario. Letwin said: “Evidently that’s not something any of us want to do. I’m not confident as things stand that the current Labour leadership would know how to solve this crisis either.” Letwin also expressed that he was not sure whether Boris Johnson was a “no-deal Brexiteer” but he did admit that Johnson was “clearly quite likely” the next prime minister.

Another former Conservative MP, Nick Boles, who voted with Labour on Wednesday, was vocal about the lack of options on the horizon in terms of a no-deal Brexit and said that the only alternative was a confidence vote to bring down the government. He said: “No-deal Brexit on 31 October is back to being a racing certainty. It is very hard to see where any further legislative opportunities will come from. So it’s now a question of politics – specifically whether a PM pursuing a no-deal Brexit can command and sustain the confidence of the House of Commons.”

 

Government victory: Is no-deal still an option?

Leading candidate to be Britain’s next prime minister, Boris Johnson, said that he will try to have a deal in place, but he did not explain what he would do if he could not come to an agreement with Brussels. Nonetheless, he supports leaving exactly on the appointed deadline, on 31 October, with or without a deal.

As many have argued, including Boles, the only remaining option is to bring down the government. Even former attorney general and Conservative Dominic Grieve agreed that he would vote against the government in a no-confidence motion, if someone like Boris Johnson tried to take the UK out of the EU without a deal. He said: “If we get to a point where a prime minister is intent on doing this [taking the UK out of the EU without a deal], the only way of stopping that prime minister would be to bring down that prime minister’s government. And I simply have to say here and now I will not hesitate to do that if that is what is attempted, even if it means my resigning the whip and leaving the party.” Chancellor, Philip Hammond, also suggested he might act similarly. In the possibility that the government loses a no-confidence vote, alternative leaders would only have two weeks to assemble a parliamentary majority, otherwise, a general election must be called.

 

Buying Property with Universal Partners FX

The pound fell after Labour’s motion was defeated, while markets tried to digest Boris Johnson’s campaign which was launched officially on Wednesday.

As the horizon appears to continue being clouded in uncertainty, currency volatility and market expectations will be influenced by Brexit developments. So, if you are considering buying property abroad, Universal Partners FX is the best choice to offer support, guidance in times of uncertainty and competitive currency exchange rates. Operating with no hidden fees or extra costs, UPFX are the ideal partners to help you navigate the markets and transfer your funds effectively, hassle-free. With a set of comprehensive hedging strategies to provide financial stability, UPFX will aim to get you the best prices in FX.

 

Get in touch with your dedicated currency broker to find everything you need to know about international transfers and the ways UPFX can make your funds prosper in the current currency

Moving to France

Buying a property in France can be a massive commitment, especially in times of Brexit uncertainty. However, if you make the right decision, the rewards will be plenty for you and your family. This is what you need to know about the property market.

A robust property market

Unlike other countries that have been hit by the global economic crisis, France has managed to retain a healthy property market, attracting international investors, with a stable year-on-year price growth.

According to online news outlet for expats, Expatica, “in the last quarter of 2017, prices increased by 3.3% year-on-year, with older apartments (4.5%) leading the charge. The biggest increases came in Paris, where second-hand properties increased in price by 5.1% in the last quarter of 2017 and 8.6% year-on-year. So far in 2018, prices have remained robust, though transaction levels actually fell slightly, with 42% of banks reporting a drop in loan applications in February 2018. France’s property market upturn since 2015 has largely been fuelled by low mortgage rates, which in February 2017 remained very low – at just 1.61% in February 2018.”

With inflation beginning to increase at a stable level in 2018 and a weak euro, foreign buyers “can get a more attractive exchange rate for their property investments and essentially pay less for a property than compared to recent years.”

Rent first, buy later

No matter where you are considering to buy, it is always beneficial to gain a better understanding of the place and what it can offer you, all year around, by renting the property first. This will help you experience the different times of year and get a clearer idea of the possible disadvantages of the property and its surroundings.

How to search for property

When you approach a realtor, or agent immobilier, you need to make sure that the company is registered and has financial guarantee, liability insurance and license by the prefecture de police. To help protect your interests, the French government has created the Conseil National de la Transaction et de la Gestion Immobilières (CNTGI) in 2014, to maintain ethical practices and regulations for real estate agents. Once you found the right realtor for you, you will sign a bon de visite, which will demonstrate that you have viewed specific properties.

Location, location, location

France has 21 regions, so you will see variations in prices and different properties. Property prices are usually determined by location.

Paris and other big cities are more expensive, as they offer more employment opportunities and a more cosmopolitan lifestyle with a variety of entertainment and cultural events to choose from. Less expensive are properties in the city suburbs and small towns, but beware, wine growing regions, naturally, are pricey. So the price will increase with such luxuries as swimming pools, vineyards and romantic barns. If you are dreaming of that scenic stone house in the countryside, with vines climbing on the walls, then this will be cheaper than a very modern building with all the relative conveniences. According to Expatica, the eastern side of France has seen some important price falls, but possibly prices will start rising again slowly.

Costs to consider

Finally, it would be good to bear in mind, that there are extra costs beyond the property price that you will personally have to settle. As property agents French Connections warn, “Having found your ideal French property at what seems like a very reasonable price, it can come as a bit of a shock to those used to the UK market that the buyer may have to pay the agency fees and is responsible for all the legal fees – this can make your French house up to 20% more expensive than you first thought.”

Once you know what is included in the asking price and other costs you will need to pay, you might be interested in getting a tailored solution for transferring your funds from the UK. Brexit uncertainty and a volatile pound can affect your finances significantly. Universal Partners FX can offer invaluable support and guide you through the process, recommending the most optimal time to transfer and exchange your currency, giving you peace of mind. Get in touch with UPFX now and find out how much you will save through a foreign exchange broker.

Buying property as the pound drops

Buying property abroad is exciting, but you need to be aware of the constant fluctuations of the pound sterling, which has been greatly affected by recent Brexit delays.

No-deal Brexit and May’s resignation

With the European Parliamentary elections and the constant fear of a no-deal Brexit, the political and economic landscapes remain under threat. The possibility of a no-deal Brexit and a weakened pound would only aggravate the situation. At the moment, after Prime Minister Theresa May’s resignation, things have become more complicated as everyone is wondering who can succeed her in the position and how this could further affect the economy. Her succession by a Leaver and Brexiter such as Boris Johnson can only mean more uncertainty as he has insisted that the UK must leave the EU on 31 October “deal or no deal.” This is definitely not what economists and the markets want to hear.

Economists point towards May’s inefficiency and inability to secure a Brexit deal with the opposition party, as the source of her troubles. The British pound has reacted negatively by slipping for three consecutive weeks.

Brexit deal: What is happening?

The weight now falls on the next prime minister, as business leaders are pressing and demanding that the next prime minister would need to have a clear plan that could reinvigorate Brexit discussions. The worst scenario is the choice of someone that would recklessly defend a no-deal Brexit that, as many politicians and economists agree, could only have a destructive result. As mentioned, Johnson is the favorite among Tories, but the competition is high, with 20 rivals competing and others concerned about his immoderate stance. As the Guardian reported, “moderate Tories alarmed at the prospect of him leading the country to a no-deal Brexit rapidly launched a ‘Stop Boris’ campaign.”

Chancellor Philip Hammond has warned both Johnson and former Brexit secretary Dominic Raab that any prime minister backing a no-deal Brexit would face a no-confidence vote. On the other hand, Jeremy Hunt is clearly against a no-deal Brexit which he has described as “political suicide.” As the situation remains uncertain, the pound’s trajectory would be influenced by the next prime minister and the way they deal with Brexit.

Buying property in Europe: Pound/Euro exchange

The pound has had a terrible run against the euro, and finance experts have forecasted that it will continue. GBP is set to slide as everyone is waiting to see who will be the next prime minister. Sterling will possibly remain very low against the euro due to the ongoing political uncertainty.

If you are considering transferring funds to buy your property abroad, this is the right moment to get in touch with a currency expert such as Universal Partners FX.

Foreign exchange experts such as UPFX have a lot of experience in transferring funds overseas and understand the various hurdles individuals and first-time house buyers face when they want to invest in property. They take the utmost care in understanding your needs and tailoring solutions that will help your finances go further. Delivering fast and secure transfers at the lowest price possible has been UPFX’s long-term goal and they will do everything they can to help you with regular transfers. By managing market volatility and protecting your hard-earned funds from the frequent fluctuations of the pound, their expert consultants monitor the markets on your behalf. By minimizing risk and having a deep knowledge of currency volatility, UPFX will aim to give you the best possible deal. Get in touch with your dedicated dealer and find out how much you can save on your international money transfers.

Brexit

France and Spain’s property markets are among the favorites for many Brits, despite Brexit. In many ways, Brexit did not change Brits’ desire to move permanently to France or Spain, indeed, it has, paradoxically made it stronger. With Brexit strategy in tatters, the UK confused about its own European identity and a climate that cannot compete with that of sunny Spain, for example, many are determined to look for a home overseas.

Uncertainties of moving abroad

Planning to purchase property abroad is a long process, and for those who have already started or are in the midst of deciding, there is nothing that can really stop them, not even the uncertainty of Brexit. Nonetheless, there are worries about their new life in Europe. For instance, many Brits worry about the lack of affordable healthcare, long legal processes of buying property, or just simply maintaining their property back in the UK due to a weak pound. But these are issues that can be tackled, to a certain extent. Finding a place in the sun to retire is perhaps a bigger enough reason that propels Brits to move abroad, even though they are aware of the possible problems. A peaceful life in the countryside is definitely more attractive, than remaining trapped in a little house back home. Enjoying a higher standard of life is a solid fact that cannot be shaken by the uncertainties of the process or the current unstable political landscape. As many have enjoyed the perks of living abroad through their regular visits and holidays overseas, it is very difficult to resist the lure of the good weather and of long cool nights under starry skies.

More European because of Brexit?

With the European elections taking place from the 23 to 26 May, it is impossible to forget Brexit. It is interesting to see how it has affected Brits in the way they perceive themselves. According to Radio France Internationale, 23-year-old English au pair Emma has been in France since August and despite coming from Thetford, where many voted for Brexit, she feels European and wants to live in Europe. It was, ironically, Britain’s decision to leave the EU that pushed her to move to another country. Like many other Brits living abroad, Brexit has affected their decision and made them understand the benefits of their European heritage. As the article reported, “the Brexit decision has created practical problems for them but also raised questions about identity.”

Sterling and Brexit

Whether motivated by Brexit or your own personal desires and wants, the decision to move overseas comes with a lot of considerations. One of the biggest ones is making your money go further, and taking advantage of currency volatility so that it does not affect your savings. Everyone has noticed that this week the pound has suffered against the euro due to turmoil in Downing Street affecting currency markets worldwide.

The fact that Theresa May’s premiership is now being questioned after her failure to get approval for her Brexit deal, has impacted on the pound, which dropped against the euro.

Theresa May’s time is coming to an end. Initially against Brexit and later having to negotiate a deal— which for many hardcore backbenchers and hardline Brexiteers was not desirable or close to what the British people have voted for in the 2016 referendum—May was given an almost impossible task. Her replacement and the possibility of a no-deal Brexit are now appearing to be, not only the stuff of nightmares, but also a reality leading currency traders to avoid the pound.

Buying property overseas is a complex process and having a trusted currency broker by your side is a massive advantage when it comes to the current movement of the pound. Universal Partners FX can help you navigate a volatile market and transfer money internationally, mitigating the negative effects of Brexit and a weak pound, and ensuring that your funds are not impacted by exchange rates. Get in touch today with your currency dealer and find out how much you can save on your currency transfers.

Spanish property market

Buying property abroad has remained a popular investment for Brits, as Spain, France and Portugal are the top desirable locations for holiday homes. So buying property in Spain, for example, more particularly in Madrid, is currently on demand.

According to Homes & Property, Madrid “represents good value against other capitals. Prime prices are 70 per cent lower than in London and a third of those in Berlin.” Speaking to Homes & Property, Carlos Zamora, head of residential at Knight Frank Madrid, said that “Prices rose eight per cent in Madrid in 2018 against a global average of 1.3 per cent and we forecast a six per cent increase this year. Transaction numbers are increasing and building permits rose 35.5 per cent between 2017 and last year. All signs point to a clear, stable recovery in Madrid.”

While Brexit has affected the exchange rate and many have initially postponed the decision to buy their overseas property, things are now much clearer in terms of what might happen. Most possibly many privileges enjoyed in the past might be lost after the UK’s exit from the EU, but being able to own your dream holiday home and live abroad are still as feasible and attractive as ever.

So, let’s have a look at how much Spanish property costs and all the details you might need to consider before buying your property abroad.

Buying property in Madrid

Whether you are buying or selling, transaction costs are around 10-15% of the property value. If you are not certain whether you want to commit to something permanent, renting is also a valid option, especially when one takes into consideration the expensive capital gains tax.

But, nonetheless, if you are searching for sophistication and luxury and you can afford to spend a bit more, you can enjoy five-star luxury with Four Seasons residences, which are unique in Spain. As the Homes & Property website noted, “the outstanding architecture, top-quality building work and extensive wellness facilities, as well as the five-star luxury of dedicated, on-site Four Seasons service mean the remaining five residences for sale have price tags starting from £2.76 million.”

If you want something more affordable, but still modern, Javier Ferrero is a contemporary development of 87 apartments in the fashionable residential area of Chamartín, where prices are approximately half of the average in Madrid. These properties start from £254,000 for 344sq ft to 1,960sq ft, and owners are able to choose the design for their apartment. 

How it works

Once you found your dream home and your offer has been accepted, then you will sign a preliminary contract (contrato privado de compravento) and pay a deposit, usually something around 10% of the purchase price.

Mortgage

If you are thinking of getting a mortgage, this is the time to make arrangements, if you haven’t done so already. The contract of sale (escritura de compravento) is finally signed in the presence of a notary, who is usually required by many mortgages. You will be responsible for paying all related taxes and costs, as well as registering the property. Registration can be done for free by the notary who will notify the registry office about your property being sold.

It is normal that you might not be able to get a mortgage until you actually own the property, so you might need to make sure that your contract does not deter you from exiting it if you have not acquired a mortgage.

Costs you will be paying

The estate agent will be paid by the seller, as it usually happens, but you will need to pay the notary costs. You will have to deal with paying the property transfer tax 6–10% (for existing properties) / VAT (or IVA) at 10% (for new properties), the title deed tax and land registration fee 1–2.5%. Legal fees will cost you 1–2% (including VAT).

Buying property overseas will involve many considerations and especially financial complexities that a foreign exchange specialist like Universal Partners FX can help clarify and overcome.

As you make arrangements to transfer large amounts of money internationally or you are required to conduct multiple transactions, you will find that navigating a volatile market and the uncertainties of Brexit can be time-consuming and stressful. Entrusting your international money transfers to a professional and dedicated currency dealer at UPFX will significantly have a positive effect on your currency transfers. This is very important when you want to transfer your hard-earned money to buy your property abroad.  UPFX’s research and technology is coupled with professional dealers’ expertise to help you access the best exchange rates, at the most opportune moment, without sacrificing the value of your funds. Give your personal dealer a call to find out how much you can save when you buy your dream home.