- Sterling dropped to a post-Brexit low of under $1.31 on 5 July 2016
- Purchasing in pounds avoids holiday home buyers suffering Brexit’s financial impact
- Three bed townhouse with private pool costs just £239k in Albufeira (Ideal Homes Portugal)
The political whirlwind stirred up by the UK’s historic vote to leave the EU on 23 June 2016 will have far-reaching consequences. The pound has proven particularly sensitive to the news, falling below $1.31 in early July, a low it hasn’t seen for more than 30 years.
Those holidaying overseas this summer have found that their break is noticeably more expensive than it would have been pre-referendum, but the same doesn’t have to be true for those buying property abroad.
Chris White, Founding Director of boutique estate agency Ideal Homes Portugal, explains,
“We’re working with our clients to offer them a way to avoid being stung when it comes to the exchange rate over the coming months. Many of our vendors – over 200 of them, in fact – want to sell their homes in Portugal and then access the proceeds of the sale in the UK. At the same time, we have buyers in the UK whose sterling is suddenly worth less if they convert it to euros.
“As such, we’re offering a win-win to both parties: they can buy and sell entirely in pounds. This means that the buyer doesn’t lose out as a result of the pounds fall in value and the seller gets to have their money in the UK, where they want it. Both vendor and buyer save money by not having to pay for currency exchange services.”
The service is already proving popular with clients at both ends of the transaction.
Portugal offers one of the most family-friendly holiday destinations in Europe, along with abundant sunshine and a short flight time. Properties there provide excellent value for money, particularly for those still able to buy in pounds through Ideal Homes Portugal.
A smart, three bedroom, three bathroom townhouse with private pool and built in barbecue in the popular town of Albufeira, for example, costs just €285,000 (around £239,000 at the time of writing).
Many of those who buy holiday homes in Portugal do so with rental income in mind, as well as personal usage. Tax on rental income in Portugal is just 3.75%, regardless of where the property owner lives. Add to that the fact that the Algarve’s population increases between three- and four-fold over the summer season and the potential for excellent returns is clear.
Using rental income to offset mortgage costs is a popular choice, according to the Ideal Homes Portugal team. Ever keen to support those who buy from them, Ideal Homes Portugal is also offering free property management for the first year to anyone who buys through them at the moment.