Moving Money to Spain for Your Home: How to Get a Better Rate

The easiest way to get more euros for your pounds is to compare providers on one number: the all-in rate against the mid-market rate on the day. Specialist currency providers can also fix a rate in advance with a forward contract, which suits new-build stage payments. Plan it early and it's one of the simplest parts of buying.

Once you've chosen your home, there's one more job that pays for itself: moving the money. On a six-figure purchase, a small difference in the exchange rate can add up to a meaningful sum.

It isn't complicated. Below is how it works, and how it fits around a new-build payment timetable.

How do currency transfers for property work?

When you send pounds to a Spanish euro account, the provider converts at a rate slightly different from the mid-market rate, the one you see quoted on financial news sites. That difference, plus any fixed fee, is what the transfer costs you.

Many providers advertise no transfer fee. That can be perfectly true, because the cost sits in the rate. So the most useful thing you can do is ask one plain question of every provider, including your own bank:

"What is your all-in rate against the mid-market rate today?"

Put the answers side by side and you'll see straight away which gives you the most euros.

What does a specialist currency provider offer?

Specialist foreign-exchange providers focus on larger international payments, including property purchases, and many buyers from the UK and Ireland use them. What they typically offer:

• Competitive rates on larger sums. Margins generally narrow as the amount grows.
• A named contact who knows your completion date and can talk you through timing.
• Spot contracts to buy euros at today's rate for immediate payment.
• Forward contracts to fix a rate for a future payment date.
• Limit orders, where you set a target rate and the provider converts automatically if the market reaches it.

Your own bank may also be competitive, particularly if you already hold a euro account. The point is simply to compare, and to ask for each quote in writing so you are comparing like with like.

We at MedSol can introduce you to independent, English-speaking currency specialists who handle property payments. You are always free to choose your own.

How do forward contracts help with new-build stage payments?

If you're buying off-plan, this is where a little planning helps most.

On a new-build home you usually pay a reservation deposit, then stage payments during construction, then the balance at completion. Those payments are fixed in euros and spread over the build, often 12 to 24 months. If the pound moves during that time, the sterling cost of each payment moves with it.

A forward contract lets you fix today's rate for a payment you'll make later. Providers typically offer them for up to 12 months ahead, and some go further. You usually pay a deposit up front, often around 10% of the contract value, and the balance when the payment is due.

Your stage payments themselves are protected under Spanish law. Since 2016, deposits on off-plan homes are protected under Ley 20/2015 and the Ley de Ordenación de la Edificación, which require the developer to guarantee them with a bank guarantee or insurance. A forward contract simply adds certainty on the currency side.

Whether to fix, and how much, is your decision and depends on how you feel about exchange-rate movements. A good provider will explain the options without pushing you either way.

How do I know my money is safe with a currency provider?

UK currency providers are typically authorised by the Financial Conduct Authority as payment or electronic money institutions. That authorisation requires them to safeguard client money, keeping it separate from the firm's own funds.

Safeguarding is the protection that applies here, rather than the Financial Services Compensation Scheme, which generally covers bank deposits. It's a well-established system, and checking it takes two minutes:

• Search the firm's name on the FCA Register (for Irish buyers, the Central Bank of Ireland register) and confirm it's authorised.
• Make sure the registered name matches the company you're dealing with.
• Ask how they safeguard client funds.

When should I set up my currency transfer?

Earlier than most people think. I'd suggest opening an account with a provider soon after you reserve, even if you don't transfer anything yet. Account checks take a little time, and having it ready means you can act when a rate suits you.

A typical sequence on a new-build purchase looks like this:

Remember to include purchase costs in your planning. On a new build in Murcia, budget roughly 12-13% on top of the price for VAT, stamp duty (AJD), notary, registry and legal fees.

Spanish notaries and banks need to see where your money came from, so pay from your own account to your own Spanish account or directly as your lawyer instructs, and keep the paperwork. Your lawyer will guide you on exactly how each payment should be made.

Any other tips for getting a good rate?

• Get two or three quotes on the same day, for the same amount.
• Give yourself time before completion so you're never forced to convert on a particular day.
• Ask about any fees on the receiving side, so the right amount lands in Spain.
• Keep a record of the rates and dates of each transfer. Your tax adviser may need them later.
• Ask who recommended the provider and why. If anyone involved in your purchase earns a commission from a referral, it's reasonable to know.

FAQ

What is the best way to transfer money to Spain to buy a house?

Compare providers on the all-in rate against the mid-market rate on the same day. Many buyers use a specialist currency provider for larger property payments, and your own bank is worth including in the comparison.

Do currency providers charge a fee?

Some charge a fixed fee and some don't, but the main cost is usually built into the exchange rate. Asking for the all-in rate against mid-market shows the full cost.

What is a forward contract when buying property in Spain?

It fixes today's exchange rate for a payment on a future date, often up to 12 months ahead, usually with a deposit of around 10%. It suits new-build purchases where payments are staged over the build.

How is my money protected with a currency provider?

FCA-authorised payment and e-money institutions must safeguard client money in separate accounts. Check the firm on the FCA Register, or the Central Bank of Ireland register, before you send funds.

How much extra should I transfer for buying costs?

On a new-build home in Murcia, budget roughly 12-13% on top of the price for VAT, stamp duty, notary, registry and legal fees.

Ready to plan your purchase?

If you'd like to see the resorts for yourself, I'd love to show you round. Message me on WhatsApp on +44 7424 864 684 or send an enquiry and I'll get straight back to you.

This article is general information, not legal or financial advice. Confirm your own position with a qualified Spanish lawyer or tax adviser before you act. MedSol Real Estate does not give currency or investment advice.

About the author — Lee Doherty is the founder of MedSol Real Estate. He spent two years researching the region before buying here himself, and now helps UK and international buyers find golf-resort homes across the Region of Murcia.