News: Forward contracts explained, fixing the cost of Costa Blanca property
Written by Inmo Investments - 14 Jun 2018
Using Forward Contracts to fix the cost
of property purchases in Spain
Protecting your overseas property purchase from exchange rate movements
We wrote recently about how the risk that a change in the exchange rate can drastically increase the price of a Spanish property you have agreed to buy, in the time between making your offer and making your final payment.
Over the past two years the Pound has strengthened against the Euro in the late springtime – when many of our customers view and make offers on properties – but then fallen just when people come to complete their overseas property purchase.
That´s bad news, and it can add thousands to the price that you thought you were paying. If you can't make up the shortfall in your Euro currency, you might have to pull out of the deal and lose your deposit.
Why take the risk? Just when you should be enjoying the prospect of completing on your property in Spain – choosing patio furniture, brushing up on your Spanish, taking that tapas cookery course – instead you´re fretting over exchange rates!
Forward Contracts: fixing your Spanish property purchase costs for peace of mind
It is only for those buyers who know they are going to buy, because it involves paying a 10% deposit and making a legal agreement to change the rest of your purchase currency within a year.
You then pay the rest of the money when the property sale completes, at the fixed exchange rate set when you made the contract. It really does buy you peace of mind.
You can use a forward contract for regular payments too. Suppose you are paying for a property to be built in stages, or are having work undertaken over time, or after you move to Spain you are receiving an income from rentals, pensions or investments in British Pounds or Swedish Krona.
Those costs, or income, will vary by the minute unless you lock in an exchange rate, making responsible budgeting impossible.
By securing your regular payments exchange rate with a forward contract you know exactly what your costs or income will be for at least the next year.
Speak with us about currency exchange solutions, and find out how a forward contract might help you manage the costs of buying a Costa Blanca property. We work with Smart Currency Exchange, rated as "Excellent" on Trustpilot for money transfers and currency exchange.
We have properties for sale in Villamartin to suit your budget
Do you like the property featured in this article? This simply stunning detached villa in Villamartin has just received a significant price reduction. Offering 4 bedrooms, 3 bathrooms, a solarium with a sunroom, underground garage, and both communal and private swimming pools. For more quality Spanish homes, click here to see all of our properties for sale in Villamartin right now.
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Town house - Resale - Blue Lagoon
Spain - Costa Blanca South - Villamartin79.995€
Fantastic townhouse with sunny garden located in the quiet area of Blue Lagoon.Comprises sunny garden area,glazed in terrace/breakfast room,lounge with open plan kitchen,1 bedroom and 1 bathroom,storage room,gas central heating,upstairs is a south facing terrace,lounge/bedroom,1 bathroom.The property is in good condition and sold furnished.80 105 2 2
Villa - Resale - Las Filipinas
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Beautiful 3 bedroom 2 bathroom detached Villa with seaviews in Las Filipinas , Villamartin. This property has been renovated throughout, with completely retiling, the big kitchen has been moved into its own independant room opening up a large living/dining room. We then have the ground floor bathroom with walk in shower, and the ground floor double bedroom with fitted wardrobes. Remarbled staircase. On the 1st floor we have the family bathroom refitted with Jacuzzi bathtub, 2 double...3 2
Town house - Resale - Las Filipinas
Spain - Costa Blanca South - Villamartin112.000€
Fantastic south facing townhouse situated in a quiet location close to amenities.Comprises sunny front garden,good size lounge with separate kitchen leading to rear glazed in courtyard,2 double bedrooms,family bathroom,private solarium.The property is in excellent condition and sold part furnished.75 2 2
Villa - Resale - Blue Lagoon
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A charming detached villa in the Blue Lagoon community of Villamartin. The property offers accommodation over the main floor consisting of a living room, an open-plan kitchen with adjacent utility room, family bathroom with walk-in shower, 2 bedrooms, and a sunroom toward the rear of the property. A converted underbuild provides a storage space and is currently being used as a leisure area or snug. Upstairs the roof terrace has been modified to provide additional accommodation, with a...54 213 2 2
Town house - Resale - Las Filipinas
Spain - Costa Blanca South - Villamartin89.000€
South facing town house for sale situated in Las Filipinas, Villamartin. The town house offers a large open plan living/dining room, a modern fitted kitchen, utility area, family bathroom, WC/Cloakroom and 2 bedrooms - one with doors leading to the balcony terrace. The property boasts charming low maintenance garden/terrace. Sold part furnished.This lovely home is set within a popular community with access to the landscaped communal gardens and four community swimming pools. Located close...70 110 2 2
Villa - Resale - Montegolf
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Well appointed detached villa for sale in Montegolf, Villamartin. An extensive home and ideal for large families or rental investment. The villa offers 4 bedrooms, 2 bathrooms, 2 kitchens, 2 dining/lounge areas and is perfect for extended families. Ample outside space and sun terraces including 40m2 solarium with distant sea views. Community offers pool and gardens for residents Walking distance to local amenities. The villa is less than a 10-minute drive from Real Campomar Golf Club...145 228 4 2
Town house - Resale - Las Filipinas
Spain - Costa Blanca South - Villamartin94.500€
Well-loved and renovated corner town house for sale, situated in a popular location in Las Filipinas. The property was renovated to a good standard in 2019 and offers a modern feel for a traditional Spanish town house. The property offers 78 m2 of living space and comprises on the ground floor, glazed entrance porch, perfect for additional dining space, ample lounge with fireplace, fully renovated American style kitchen with adjoining utility and laundry room, and guest...78 2 2
Villa - Resale - Villamartin
Spain - Costa Blanca South - Villamartin149.999€
This is a 2 bedroom 2 bathroom detached villa in Villamartin. This property has an open plan living/dining room with open fireplace, american style kitchen, 2 double bedrooms with fitted wardrobes and 2 bathrooms, 1 shower and 1 bathtub, the master bedroom having ensuite bathroom. As we go into this properties underbuild you will notice a lot of potential has been uncovered. The current halted project was to create a self contained 1/2 bedroom, 1 bathroom apartment. Both floors and the roof...72 240 2 2