Any French Home owners who reside in UK

[Ballistic Banana]

With the current interest rate rises would it better ( are the rates better? is the market stable there) to get a French Mortgage for a property in France or would you still borrow here and keep it all easy in Sterling and buy outright.
We have been toying over the last few years over to buy land and build, buy new, renovate..
Just recently a property we have been after for a while has come for sale exclusive to us, its not on the market. So gotta get our arses in gear.

Cheers for any help

BB

[MitchT]

If you want to minimise risk you should borrow in the currency that your wage is paid in... unless you're a highly competent currency trader who can successfully trade Forex to hedge yourself against exchange rate fluctuations. The European Central Bank seems even less reluctant to put their rates up than the Bank of England, so if you borrowed in Euros you could be hit twice... Once by the increase in Eurozone interest rates and again by the increase in the value of the Euro, relative to that of Sterling (I'm assuming your wage is paid in Sterling). This is because currencies are always strengthened by rate rises, so not only would you have to pay more Euros due to the rate rise but the Euros would actually cost you more in Sterling to purchase due to the Euro being strengthened relative to Sterling. At least with a Sterling mortgage you only have the rate rises to worry about and not the exchange rate too. Of course, if you did borrow in Euros and Eurozone rates flatlined while UK rates rose further you'd be quids in as you'd get more Euros for your Sterling. Basically, borrowing in a currency other than that in which you are paid is a riskier proposition which can lead to greater savings or greater losses. Without the aid of a crystal ball I'd stay well away though.

[neil-f]

Ballistic Banana said:

With the current interest rate rises would it better ( are the rates better? is the market stable there) to get a French Mortgage for a property in France or would you still borrow here and keep it all easy in Sterling and buy outright.
We have been toying over the last few years over to buy land and build, buy new, renovate..
Just recently a property we have been after for a while has come for sale exclusive to us, its not on the market. So gotta get our arses in gear.

Cheers for any help

BB

As far as I am aware you can only borrow up to 20% of your salary in France to purchase a property so this might make your mind up

[neil-f]

If you have the funds in the Uk you can sign up to a company like HIFX (free) and they will allow you to agree an exchange rate (comercial rate) and time scale with them for the tranfer of Euros and the first one is commission free this exchange can be paid direct to the Notaire to hold for payment or into your French non resident bank account..
If you are purchasing a property in France you will need to open a French bank account to sign up for EDF etc.
Good luck

Edited by neil-f on Tuesday 10th July 13:33