The news is terrible at the moment it would seem, with global exchange rates slinking down into depressing gloom. This is bad news for businesses, and for consumers. The dollar seems shaky at the moment, and the Euro seems to be running away from the pound sterling as though it has been frightened off. Certainly investors and businesses are struggling to work out the best deals, and for the global market online, rates seem to be changing so quickly that it’s increasingly important to stay on top of the game.

It used to be the case that we would simply pop to our local shop or town and buy the items we needed in our local currency. We’d think nothing of it, of course. However, with so many of us now buying products online, we no longer even think about the country that the company is trading in. Often we see that the prices are listed in dollars, or Euros, and think very little of it. Some people change the currency to their own local one, but in fact if you do a quick, independent currency exchange rate check, you’ll often find that buying products in one currency will be cheaper than buying it in another, possibly your own. Since some companies online have their converted prices fixed for a few days at a time, a significant change in rate can make a big difference.

If you’re in the property market, and in particular looking at investing overseas, this problem with sliding exchange rates becomes extremely challenging. One day the deal looks good, but within a couple of weeks you’re starting to look at the same deal and realise that, as a direct result of the exchange rate, you’ve just lost several hundred pounds, dollars or Euros, and possibly even more than this. Even investing in a fairly modest 100,000 property, a change in exchange rates between pound sterling and Euros of just a few pence can make several thousand Euros difference. If you’re quick, then this can be good news, but usually you have enough to worry about without pouring over all the bank rates and exchange rates and currency conversions.

It isn’t all bad news of course, and there are companies and opportunities which seem to either help you take advantage of the challenges which put others off, or simply challenge the rates themselves, to help offer you a better deal at what would otherwise be a tough time. I recently came across a company that helps people to invest in overseas property, and is currently offering an exchange rate which seems utterly absurd to anyone who’s recently looked into the current rates. I checked today, and the current rate is 1.26 to the pound sterling, which isn’t brilliant of course. However, the company I came across is still offering the same exchange rate that we saw back at the beginning of this year, at a staggering 1.40! To have what is equivalent to well over an 11% difference in exchange rates is phenomenal!

An exchange rate difference of 1.40 to the pound sterling represents more than an 11% difference when compared to the current exchange rate offered by banks and other financial institutions. If you’re investing in a 100,000 property, and 11% difference is clearly a not inconsiderable sum of over 11,000! Now who wouldn’t be interested in getting on to that particular bandwagon?

Obviously when purchasing property overseas it is important to bear in mind the currency exchange rate, and it is always recommended that once you start to look seriously at the prospect of purchasing property abroad you agree an exchange rate with all parties and have this included in the written terms so that you don’t fall foul of any unpleasant shocks that hit the financial world later down the path. A major change in an exchange rate can result in costing you many thousands of pounds extra, so this is sound advice. Further sound advice would be to take advantage of a company who is hopelessly optimistic enough to offer an exchange rate that refuses to move on from the sunny times at the beginning of the year, and is still offering a rate that is considerably higher than anything offered by the banks. Such an opportunity makes moving abroad more like going on holiday!

Of course, there’s another, almost hidden advantage here. When buying property there is always the danger that prices dip for a while, and you’re left with a property dropping in value. Clearly if you do your homework and buy a property that is well worth investing in, this won’t be a problem, but we all have to be realistic, and if exchange rates are low, it may well affect consumer interest in property markets. Buy managing to jump in to the overseas property market at the exact time that rates are low, but managing to secure a high rate for yourself, not only are you saving money in the short term, but you’re guarding yourself against possible variations in property prices for the longer term too. To be honest, there’s little to stop you buying a property at this high rate, and selling it on at the normal rate of exchange a little later and netting yourself tens of thousands in profit!

For the first time investor, you may be surprised just how different buying overseas property is, and you may have set yourself an initial budget. Once you do a little further research, however, you may well discover that, as a result of varying international laws, traditions, methods and requirements, your budget is shrink wrapped a little too far, and you find the whole project becoming less feasible. By managing to save yourself at least 10,000 simply by using an inflated exchange rate like this, you’ll be able to get back on budget without lifting a finger! Well, perhaps a finger- after all, you’ll have to find the same company I discovered first!