Brexit uncertainty increases costs of overseas property

17/07/2018 News Team

European properties have risen in price for British buyers since 2015 due to Brexit uncertainty, despite Spanish house prices still being 16 percent lower than they were in 2010.

Europe’s property markets have faced some tough times in this period, with Spain, Portugal, and France all experiencing a drop in prices.

However, British buyers can’t take advantage of these lower prices as since 2015 Brexit uncertainty has moved the pound from EUR 1.38 to EUR 1.13, meaning that if buying in pounds, prices in France have risen 29 percent, 39 percent in Spain 39, and in Portugal they have risen by 48 percent.

Chris Saint, a senior currency analyst at Hargreaves Lansdown, believes there are steps buyers can take to protect themselves from currency fluctuations.

He said: “Anyone who’d been hoping to buy a home overseas may have seen the collapse in Spanish house prices, the blip in France and the difficult years in Portugal as their opportunity to snap up a bargain. 

“However, local prices aren’t the whole story here, because the price you pay also depends on the exchange rate. Since 2015, Brexit uncertainty has pushed the pound lower, making house prices in Europe far less attractive.

“It’s bad news for bargain-hunters, but if you are planning to buy overseas, you can protect yourself from any further exchange rate fluctuations by using a currency specialist. Not only could it be cheaper than using a bank, but it’s also possible to fix an exchange rate in advance or target a specific rate.”

Bristol-based Hargreaves Lansdown is a FTSE 100 constituent and the UK’s biggest execution (XO) broker. They are used by over one million investors and manage £88.8 billion, as at 30 April 2018.

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