Currency exchange rates?

If you are planning to buy a rental home, or you're thinking about what to do with one you have just acquired, this is the place for any questions about starting out in the rentals business.
genie
Posts: 7
Joined: Sat Feb 24, 2007 12:40 pm
Location: Camposol Costa Calida

Currency exchange rates?

Post by genie »

"Yes another Newbie" We haven't put our property on the market yet, just putting out the details to friends, however it has been pointed out to us that we should not only state the prices in sterling but also in Euros. But what is a fair exchange rate to apply, when converting the currency.
:? :?

Genie
istrianholidays
Posts: 41
Joined: Wed Feb 14, 2007 6:55 pm
Location: Istria, Croatia
Contact:

Currency Conversion Rates

Post by istrianholidays »

Hi,

I think it helps to also display prices in Euro to get Irish and other continental European clients. I would suggest you do a combination of the following:

- check roughly the standard exchange rate which you will get from the bank over the last few months

- add a "little" to account for any currency fluctuations

- round it to make the figure look acceptable in Euro (eg not €431)

- ensure it is competitive with the other properties based on the Euro price also.

- be prepared to update the prices on your website if there are significant currency movements in either direction.

- make sure your contract states that bank changes are to be paid by the client.

... our rate is differs across the year in order to be competitive and so it looks reasonable across the year.

Also remember that if you take a damage deposit in Euro - and then return it in full - you could lose money in bank fees included in the transaction. You need to to aware that this will happen and reflect in your rental price (my preference) or make it clear in your correspondence that regardless, the deposit returned to the client in Euro will be slightly less than the client paid in the first place.

Rgds,

Jen
A-two
Posts: 2091
Joined: Mon Oct 25, 2004 10:05 am
Location: USA

Post by A-two »

Hi genie,

Good suggestions Jen. There's also a useful little tool at www.oanda.com called FX converter. I'm careful not to lock into a rate too far ahead of a payment due date. e.g. I received an international inquiry this weekend for July 2008. I'm happy to give an approximate idea of what it would cost them in their own currency if they were to pay me in full today at current rates, but if it goes ahead, our contract would be stated in our own currency and conversion to any foreign currency would not be fixed until closer to the date of actual payment.
genie
Posts: 7
Joined: Sat Feb 24, 2007 12:40 pm
Location: Camposol Costa Calida

Post by genie »

Hi once again.
Thanks for the advice and the help. The web site was very helpful. I took your advice and ask around, but could not pin down any set rate for this country, unless you wanted to buy euro, then the rate was approxamitely 1.42 So I went into a renting web site at Camposol on the Costa Calida (this is were we have our property) and had a look at the rate of exchange others were charging, all of the owners were working to a rate of 1.49.

Reg
genie 8)
KathyG
Posts: 3274
Joined: Sat Jan 28, 2006 9:31 am
Location: Le Faou, Brittany
Contact:

Post by KathyG »

Hi Genie,

We use http://www.xe.com and just ask them to use whatever the rate of excange is on the date they're making the payment.

Kathy
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