Take Advantage of Currency Rate Movement to Maximise Your Property Budget

Moneycorp brings to you today a case study demonstrating how a currency broker can help to maximise your budget and time your transfer effectively. Follow the case below, where we take you through Kate and Joel’s journey, a young couple looking to move to France permanently in the coming years.

The case of Kate and Joel

Kate and Joel spent their Christmas in the UK searching for a property in France, as after long deliberation, Joel agreed to take a life changing opportunity at a new role working for a film company. Joel’s role requires him to work in France for the summer period between May and September but Kates Job doesn’t give her the flexibility to work remotely and so will remain in the UK. Joel plans to return to the UK for the remainder of the year to be with Kate until she finishes her degree and moves to France permanently as a makeup artist. As they will only be living in France for parts of a year, they are hoping to rent the property out for the remainder. They had been looking at properties over the Christmas period and finally found an apartment in the heart of Paris that they were looking to proceed with.

On the 3rd of January 2022 they agreed to pay the deposit of 10% of the 400,000 EURO apartment in Paris.

FrenchEntrée referred them to Moneycorp, as they wanted some guidance on when would be the best time to transfer their funds and also whether they had any tools available to them to make the most of their money. A member of the partnerships team called them for an initial consultation and talked them through the mechanics. They were happy to proceed and were transferred instantly to the account opening team. The team opened their account within 5 minutes and flagged with their dedicated market specialist that they needed to make a payment on the day.

Their dedicated dealer picked up with them straight away as they understood their urgency.

After speaking with their dealer they were offered the exchange rate of 1.1896, meaning their 40,000 EURO deposit cost them £33,624.

Although they had to pay the deposit at this rate, they did not want to use to settle with that rate to pay the full amount at the rate on this day as they hoped it would improve so with the help of their dealer at Moneycorp they decided to monitor the rate.

On the 19th January, their dealer rang them back and let them know that GBP/EUR had moved across the 1.20 line for the first time in 2 years, pre pandemic. They were delighted with the call and decided to take advantage of that rate to pay for the rest of the price. Kate and Joel didn’t have all the funds available at that time, however they were told that they could lock that rate via a forward contract for which they only had to put down a 10% deposit of the total final amount. This meant their remaining 360,000 Euros cost them £300,000, taking their total to £333,624.

On the day of completion the exchange rate had hit a low of 1.176. If Joel and Kate had waited for the day of completion to pay their funds their remaining 360,000Euros would have cost them £306,122, taking their total to £6,122 worse off.

Through the guidance of Moneycorp and the ability of using a forward contract, Kate and Joel not only achieved a better income for their budget but it also provided them with a certainty about the final cost of the property, avoiding the impact that any negative fluctuation would have had on the price of the property.

Now the property purchase is out of the way, Joel and Kate are still using Moneycorp to manage their payments between UK and France. From repatriating the rental income to manage smaller payments to cover the cost of utilities and other maintenance expenses. They do that by using the Moneycorp online platform, which is accessible from France and UK 24/7, supported by a great customer services and dealing teams whom are always available and happy to speak with them.