Currency Conversion

If you are buying a property using funds offshore you will need to change your money into the appropriate currency. With fluctuating exchange rates, the home or investment property you are considering could cost you more than you intended.

Fluctuating exchange rates can increase or reduce the value of your currency. This is called foreign exchange risk. Specialist currency brokers are able to establish your foreign exchange risk and put in place strategies to avoid significant potential loss.

Banks offer this service however, unless you are exchanging less than $10,000 or a couple of million dollars, they do not offer the best rates. Other companies such as www.ozforex.com and www.HiFX.com offer competitive rates of exchange. They provide access to a range of currency purchasing products so you don’t have to have all of your currency available immediately to secure a great exchange rate.

They consider your individual circumstances to identify how best to protect you from adverse movements in the exchange rate.

Many people also believe that there isn’t much they can do with their currency until they have the funds available in their account. Quite often people will leave their currency purchase to the last minute and are left disappointed with the rate they achieve. There are however several ways that this situation can be avoided!

An Example

On 3rd Feb 2007, Client A is living in the UK and signs a contract to buy a property in Mosman for $1,000,000 AUD (Australian dollars).

On this date, the exchange rate was 2.5505. The client is expecting to pay 392,050 GBP.

On 11th April 2007, the property settles and the exchange rate is now 2.3833. If the client sent over 392,050 GBP, it would not only convert to $934,444 AUD and not $1,000,000.

The client is now $65,556 AUD short.