Why use a currency specialist when buying property in Spain?
When you’re thinking about buying property in Spain, whether for an investment, holiday property, or emigration, currency exchange is unlikely to be at the front of your mind. Few overseas property buyers realise how important using a currency exchange specialist is to the property buying process and how currency market movements affect the price of your property and the overall costs of the buying process.
Managing your Spain property budget
We recommend spending some time considering the impact that currency has on your budget. While you may already have a certain amount of Euros in the country to pay outright for your purchase, the majority of people will need to their Spanish property purchase.
The currency market is constantly moving, with exchange rates going up and down in response to a range of factors, such as economic and political events – both planned announcements and activities; and unforeseen events. This means that when you are purchasing a property in Spain in Euros, the amount of the currency you are transferring to pay for the property, such as Sterling, will go up and down in line with the exchange rate. This exchange rate moves when key influences, such as Brexit negotiations or announcements about the economy, boost or weaken currencies and affect the market mood.
Uncertainty means market volatility
Times of political and economic uncertainty make the currency markets volatile, with rates often swinging up and down considerably, at very short notice. Given how quickly these currency market movements take place, the exchange rate you achieve on your currency transfer could represent a dramatic difference in the cost of your property in Spain.
In many cases, a buyer will find their dream property in Spain, find out what the exchange rate is that day and then use that rate to decide whether or not to purchase. The wheels are set in motion to make this purchase, but the buyer does not actually exchange their funds until they need to send the money through to the seller. In response to the second-by-second fluctuations in the currency market, this means that the amount needed to transfer into Euros could be dramatically different from the price of the property that was originally budgeted for.
How does using a currency specialist, such as Halo Financial, work?
For example, during the course of summer 2017 GBPEUR rate fluctuated between 1.19 and 1.07. If you agreed on the purchase a €300,000 property when the rate was 1.19, this would have cost you £252,100; if you did not complete the transaction until a few months later when the rate was 1.07, your property would cost you £280,373 – a significant loss of almost £30,000. Using Halo Financial to move your money between countries takes a significant amount of risk out of this process and helps you stick to your property budget.
Register early to be prepared
It’s worth registering with Halo Financial as soon as you know you wish to buy property in Spain, so you can benefit from a dedicated Currency Consultant, who can talk you through the markets and what they mean for your Spanish property purchase.
“Forewarned is forearmed”
We have a number of tools that you can use to your advantage to save money when purchasing your property.
A particularly useful tool is the ability to book a Forward trade, which allows you to book the exchange rate when that rate suits your property budget; and pay for this currency trade at a later date – this could be up to one year in advance.
By agreeing a Forward trade, no matter how the currency rate moves before you are able to settle the cost of your French property, the amount you pay will not change. This is particularly useful when exchange rates are volatile, as it ensures you can plan your purchase with price certainty.
Another benefit of using this tool is that you can transfer a lump sum initially and then make multiple payments over a period of time; for example, you could pay your deposit, the rest of the purchase price, taxes, fees and anything else from the one initial transfer, protecting your funds from market movements and allowing you to budget effectively.
Why use Halo Financial to make your currency trades?
In addition to specialist currency tools, there are a number of other reasons to use a currency specialist over your local bank. While many people will immediately go to their bank or the Post Office to make their currency exchange, not realising that they can save money on larger transactions by looking elsewhere.
As soon as you sign up with Halo Financial, ideally before you even put your plan to purchase in Spain into action, you will be assigned your own personal Currency Consultant who will work with you to understand the market and assess the best course of action for your needs. They will be able to advise you on the best course of action for you depending on the fluctuating exchange rates, and explain how these can affect you and your property purchase.
Your dedicated Currency Consultant
Your Currency Consultant will also monitor the currency markets for you to ensure you get the best deal. Unlike your local bank, you will not be charged a commission on your transfers, and there are no additional fees on any transfers over £5,000 – saving you money before you even access the market.
Your Currency Consultant can also offer you a number of regular free news updates and insights to help you gain a greater understanding of the currency markets yourself, and how their movements can affect you.
There are many different combinations of currency services and tools that you can use to make your trades, depending on your own personal circumstances.
One-off payments to and from Spain
In addition to Forward trades, you can also make quick one-off payments if you find yourself needing additional funds quickly – and your Currency Consultant will help you target the most favourable exchange rate so that you can continue to make the most of your money.
Regular payments to and from Spain
Another useful tool you can use after you have bought your property in Spain is the ability to make Regular currency trades (RCTs). For example, if you are sending money regularly to Spain to pay your mortgage and monthly bills, you can set this up as an automated process, so you don’t have to worry about making separate payments each time, or missing any important payment dates.
You will not be charged a transfer fee for each payment, and you can rest assured that your Currency Consultant will offer you the best available rate. There is no maximum limit to how much you can transfer, and the minimum amount you can send is £250 per month.
You can also combine this service with a Forward trade, so you always know how much you need to pay or will have in your account.
Get in touch with Halo Financial today and find out the best way to make your currency transfers for your Spain property purchase.
Residency
Due to the EU’s Freedom of Movement pact, if you are planning to move to Spain as an EU citizen, there is no need to apply for a specific visa. Providing you can provide proof that you can support yourself financially, and not be a burden on Spain’s welfare state, then deciding to live in Spain should not be an issue. However, in order to live in the country and enjoy the same benefits as any other Spanish resident – including those pertaining to healthcare, employment and your child’s education – you will need to be in possession of a Certificado de Empadronamiento. This is a resident’s card, which you will be given when you register with your community’s padrón (city roll). This can be done at your local town hall. To register to become a resident you will often need ID – such as an EU passport and proof of your new address
You should register as a resident within three months of arriving in the country. The current uncertainty over the UK’s future relationship with the EU means it is currently unknown exactly how residence requirements will change for Brits looking to move to Spain post-Brexit – or indeed for those expats already living there. Whether UK nationals will be subjected to the non-EU rules, or whether a freedom of movement pact will be included as part of the exit negotiations, is as yet unknown. It’s worth remembering that Spain does offer a Golden Visa scheme, which offers residency to non-EU nationals who purchase a home for more than 500,000 Euros. Currently, non-EU residents who are planning to live and work in Spain will need to qualify for an EU Blue Card. To qualify for this, you will need to have higher professional qualifications, such as a university degree, and an employment contract or a binding job offer which offers a salary higher than that of the average for the same position. If you are a spouse or partner of a Spanish citizen, then you will be required to prove you have ‘reasonable prospects’ of staying permanently in that country. In other words, the onus is on you to prove that your relationship is genuine.
Removals
Whether you’re moving to Spain in search of a sunnier climate, or you’ve made a career move, it is essential that you send your belongings safely and securely onto your new destination. Having a reliable international removals firm on board is one way to avoid any mishaps along the way. Give yourself plenty of time to research companies that offer the service you require and gather quotes. Whilst many may offer a similar service, or indeed cheaper quotes, it’s worth doing your research. International removal companies are governed by an array of official bodies, which make their service adhere to strict rules and regulations.
You should always look out for the following accreditation before making your final decision:
- FAIM Accreditation, the only independent Quality Assurance standard for the International Moving Industry.
- Membership of the FIDI Global Alliance, which sets a quality benchmark for its members.
- Membership of the British Association of Removers Overseas Group. BAR Overseas is covered by the IMMI Advance payment guarantee scheme for your financial protection.
Choosing the right removals company can take some of the steam (and stress) out of the move. Once you have decided which company is going to take care of your move they should take you through each step of the process. If you have moved house before, then much will be familiar – you will be working towards a date, deciding whether to have someone pack for you, or whether you will be doing it all yourself. Removal Companies will assign you a move coordinator, who will advise you on the process and dates and timings. As the moving date moves closer, you’ll be kept informed of what’s happening and when. If you’ve decided to pack your own belongings, you’ll be given professional boxes, material and cartons in which to do this. Remember to give yourself plenty of time to pack up. It’s easy to underestimate what you’ve got to do. If professional packers are completing the process, you’ll be given a moving date and they will arrive and make sure everything is safely packed away. They’ll give you an inventory of what has gone onto the lorry.
Providing you are an EU member, you will need the following documents to move your belongings to Spain:
- Passport
- Certificate of residency confirming they have been working and living for more than 12 months in the current country of origin.
- European Certificate or NIE number.
- Removal inventory in Spanish
- Valuation form for Shipment Protection Cover
- Purchase receipts (only applicable if you are importing any newly purchased goods)
Please note, this could change as the ongoing Brexit talks take shape. Check with your international removals firm for exactly what you need to provide. When shipping your personal belongings to Spain, the transit time between removal in the UK and arrival at your new home will be approximately three to seven days for dedicated loads and one to three weeks for part load shipments.
Transporting Pets
If you want to take your furry, feathered or even scaled family members with you, then you will need to find out the rules regarding the transportation of pets. These rules will differ slightly depending on where you are travelling from and the type of animal you wish to bring.
Unsurprisingly, bringing animals which are native to Spain is more straightforward than bringing those that aren’t. Pets will usually need to be microchipped before they are allowed to enter, possess a pet passport or third-country official veterinary certificate, and cats and dogs will need to have been vaccinated against rabies. Depending on the country you are travelling from (not the UK), and the animal you are relocating, some airlines will allow small pets like cats or dogs to be taken with the passenger in the cabin. However, it’s always worth checking with a pet transportation specialist first as they will be able to advise you of all the rules and regulations.
Healthcare
In Spain, most basic healthcare is provided for free – or at least at low-cost – throughout the country for all residents, providing they are contributing towards the social security system. This usually means that you will need to work for a company or be registered as self-employed. If you are self-employed, you can apply for your social security number at your local Social Security Treasury Office (Tesorería de la Seguridad Social). If you are working for a company, then your employer should sort this out for you. Once you have a social security number, you will need to visit your local medical centre to obtain a medical card. You will then be assigned to a particular GP and that will be the person you see from that point on.
Residents from some EU countries who are over 60 years of age may be able to get their country’s health system to cover them for any treatment providing they are in possession of the European Health Insurance Card (EHIC); formerly known as E111 health insurance. The EHIC can also be used to cover any EU residents for emergencies that may occur in the time between arriving to live in Spain and receiving the medical card – although it should not be used as full-time cover! It’s worth noting, that even if you don’t have a social security number and are younger than 60 years of age, then you will still be entitled to free emergency care in any public hospital, providing you have a Certificado de Empadronamiento – this is a resident’s card which you will be given when you register with your community’s padrón (city roll). While those who are eligible to take advantage of Spain’s public health system will receive most healthcare free, there will still be costs (albeit subsidised) for things such as prescription medicines, dental care and eye care.
It is worth noting that healthcare standards do vary depending on where you live and some rural areas – especially those that are inland – provide only very basic medical facilities. If you are not entitled to free public healthcare in Spain, which could potentially be the case for British residents post-Brexit, then you will need to look into taking out private healthcare. There are a number of providers throughout the country. Many expats – whether they qualify for free healthcare or not – do choose to take out at least some form of private healthcare. There are a number of reasons for this, such as to avoid the often lengthy waiting times for non-emergency treatment that exist through the public healthcare system and to ensure they will be treated by an English-speaking doctor (this will not necessarily be the case in the public system).
Education
While many children in Spain attend pre-schools from the age of three, children don’t actually start compulsory education at primary school (Educación Primaria) until the September of the calendar year in which they are six years old.
Some children may be allowed to start primary school before this, but that will often be down to the discretion of the Government in the region that you live. In Spain, education is overseen by the regional governments, although the system is similar throughout the country.
Primary school lasts for six years – typically between the ages of 6 and 12 – after which children move on to Compulsory Secondary Education (Educación Secundaria Obligatoria – commonly referred to simply as ESO). ESO lasts for four years (12 to 16).
At the end of the fourth year, children will take exams in an attempt to earn their Graduado de Educación Secundaria (Secondary Education Graduate certificate) at which point they can then choose to leave school. Most Spanish families choose to send their children to free state schools. However, the standards of state schools vary dramatically.
Generally, if your child is of primary school age, they will simply attend the school closest to where you live, although there is a little more choice at secondary school level where you will be able to apply to any schools located within a certain geographic zone.
Halo Handy Hints
It is essential to note that the teaching language used in all state schools will be Castilian Spanish, alongside any co-official languages that may be used in the particular region in which you live (for example, Catalan, Basque, Galician, or Mallorquin). Therefore, if your child struggles with the Spanish language, they will find school hard going at first; you should also not assume that their teacher will speak any English, especially if you are not moving to a popular expat spot.
There are other options aside from state schools, including international schools (which will teach in English) and private schools (which are sometimes bilingual). It will cost parents money to send their children to either of these types of institutions, but international schools will almost certainly be more affordable than their private equivalents. There are also faith-based schools while homeschooling is another option.
Last minute checklist
No doubt you will have remembered to have handed in your notice at work, book your one-way flights and other such essentials. However, there are a host of other tasks than can easily be forgotten about in the excitement of emigration. It’s an obvious point, but it’s worth checking your passport is in date; this will save any unwelcome surprises at the airport. On the subject of important documents, make sure you also keep all relevant paperwork in one place and in a clear order so it can be easily accessed. These documents include:
- all correspondence with immigration departments
- your medical records
- school reports
- references from employers
- anything else you think you may be asked for. Make sure all bank accounts and similar services that you will no longer need have been closed and cancel any direct debits.
Finally, and it may sound obvious, but take time to say goodbye to all friends and family that you may be leaving behind. The stress of moving to a new country and sorting out all that needs to be done could mean that you run out of time to say proper farewells.
Need more advice?
Since 2005, Halo Financial have helped thousands of customers to take control of their currency when emigrating or buying property abroad, and we have many clients who purchased in Spain. We understand the process that you’re going through and have trusted partners and advisors on hand to help at every stage. Get in touch to see how our team of experts can help you.
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