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How to safely transfer overseas funds to buy a property - July 2019

By Guest Blogger, Sue Watts,



If you’re looking to transfer funds from overseas to buy a property in Australia, a currency specialist may be able to help you make the most of your money and support the purchase process.

Understanding the property purchasing process in Australia

Just as you need a clear plan to find the home of your dreams, it’s worth planning how you’ll make the required payments. Once you’ve found your property and had an offer accepted, in Australia you will need to pay a 10% holding deposit immediately. It can take time to set up a currency exchange account because, like any financial application, it requires rigorous checks, so it’s best to start the ball rolling as soon as you start to look for a property in earnest.

Working through the red tape

If you aren’t an Australian citizen, or permanent resident, you will need to gain permission from the Foreign Investment Review Board (FIRB) before you can purchase a property. You should get an answer within 40 days in most circumstances and although you can exchange contracts prior to approval, it would be wise to ensure the contract is conditional on receipt of that approval to ensure you are not in breach of contract and liable for any financial penalties. If you buy a new-build property or a rural home, you may not need to permission from FIRB, but the best approach is to seek advice from a solicitor or property buyer on whether this is required.

Making the purchase

Even if you have a local bank account and mortgage, the average minimum deposit required is 20% in Australia, so there may be a need to release some equity or repatriate funds from the UK. This is when it can help to have an international payments account that allows you to move funds easily between currencies so that you can make sure the money is where it needs to be to secure your home. Settlement generally takes place in 42 days, or six weeks after exchange.

Top tips for getting value from your currency provider

When you’re making such a major investment, you want to make every cent count; the rates offered by different providers can vary and even a fraction of a percentage point can make a big difference when you’re sending large sums. Also double check the transfer fees, and if you receive a quote then ask for the overall final cost. Providers may appear to offer great rates, and then those gains are lost in high transfer fees, or similarly may promote no a fee-free service but offer less favourable rates. Look out for an established provider with a personal presence – online transfers are very convenient, but on something so important it’s valuable to have someone at the end of the phone who can talk you through international payment processes, provide guidance on the market or answer any questions you can have.

What can I do about exchange rates?

Unfortunately, there’s nothing you can do to control or even predict the exchange rate, which fluctuates all the time. However, a currency specialist does have a range of tools that allow you to track, target and even fix a prevailing rate for a set amount of time. Which approach you choose will depend on your deadlines and your attitude to risk, but a specialist can talk you through your choices and they can all be better value than simply crossing your fingers and hoping for the best.

Sue Watts is a currency specialist for moneycorp, supporting people and businesses with a range of currency transactions. www.moneycorp.com/en-au



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