Introduction
As an estate agent or property broker, when your client agrees to buy a property overseas, often the exchange rate on the day they view feels like part of the deal.
But, between the offer being accepted and the transaction completing, which can often be weeks or even months later, the FX rate can shift dramatically.
A lot can change in a short space of time and when it does, the cost of that dream home, holiday villa, or retirement property can rise by thousands of pounds.
As a property professional, this puts you in a difficult position. You want to help your clients secure their home, confident that their budget will cover all eventualities. But when exchange rates move, you don’t have control-or so you might think.
That’s where forward contracts come in.
This blog explains what forward contracts are, how they work, and why they’re such a valuable tool for overseas buyers.
More importantly, it shows how estate agents, property finders, solicitors and any other professional services involved in the purchase can play a key role in helping their clients make better informed financial decisions, without needing to be an FX expert themselves.
The impact of FX on your property budget
The problem: movement in currency markets
Currency markets move constantly, day to day, hour to hour, minute to minute. When a client agrees to buy a property abroad, they often assume the amount they’ll pay in pounds is fixed.
It’s not.
Consider this real-world example:
- A UK buyer agreed to purchase a villa in Malta for €600,000
- On the day the offer is accepted, the GBP/EUR rate is 1.1960 (May 2025)
That means the property will cost £501,672 - But three months later, when the final payment is due, the rate dropped to 1.1405 (July 2025)
Now, the same property costs £526,085
That’s a difference of £24,413, purely due to FX fluctuation.
For many buyers, that means scrambling to find extra cash, reducing deposit amounts, or reconsidering fees and fixtures. Twice in 2025 we have already seen 5 cent moves on GBP /EUR exchange rates which have had real life impacts on property completions.
From a solicitor or Estate agent’s perspective, this kind of budget uncertainty can delay deals, spook buyers, and cause stress on both sides of the transaction. In many situations, both vendors and buyers have pulled out of transactions as a change in exchange rate has meant the resulting cost of or return from of a property sale has made the deal untenable to their situation.
If you’re looking for expert guidance on foreign exchange solutions for your international property transaction, get in touch with one of our specialist currency brokers today.
The Solution: Forward Contracts
A forward contract is a simple agreement to fix an exchange rate today for a transfer that will happen in the future.
It allows your client to lock in the FX rate the day their offer is accepted, ensuring the final price in pounds won’t change, no matter what happens in the currency markets.
How it works:
- The buyer agrees a property purchase in euros.
- They speak to an FX broker like Optimal Currency and book a forward contract.
- The broker guarantees a specific exchange rate for a fixed amount, to an agreed date in the future, with most currencies available up to a year and some even 2 years advance.
- When the Euros are due, the buyer settles the contract in pounds, at the agreed rate, not the market rate at the time.
The result: peace of mind and no nasty surprises when it’s time to complete.
A Clear Example
Let’s revisit our earlier example, but with a forward contract in place:
- Property: €600,000
- GBP/EUR rate at offer: 1.1960
- Locked-in forward rate: 1.19 (Small forward premium to lock rate in over the time period applied)
- Fixed price in pounds: £504,201
Even if the pound weakens dramatically before completion, the buyer only ever pays £504,201.
That’s budgeting with certainty.
To fix the rate of Exchange, a small deposit typically 5–10% of the exchanged amount, is held by the broker as a security deposit against the deal. It isn’t a cost or a fee and represents part payment of the total contract. In the given example, the buyer would have lodged 5% or £25,210 at the point of fixing the rate and then the balance of £478,991 on completion.
A small margin deposit fixing the rate means no exposure to fluctuating rates and no nasty surprises on completion.
Why FX matters for Estate Agents and Solicitors
- Smooth completions and fewer delays
Buyers who are protected from currency risk are less likely to delay or renegotiate. You’ll have a clearer path to completion, and fewer deals fall through due to affordability issues.
- Reduced buyer anxiety and greater confidence in the property chain
Currency worries are often the biggest unknown for international buyers. When clients understand that they can fix their costs, they feel more confident — and that confidence flows through the transaction.
- Professional service and added value
Introducing FX planning to your clients demonstrates care, foresight, and expertise. You don’t have to be an FX specialist; you just need to know the right questions to ask:
- “Have you considered locking in your exchange rate now?”
- “Would you like to speak with someone about protecting your budget?”
By referring clients to an experienced broker like Optimal Currency, you can add real value with very little effort.
When to lock in a Forward Contract
The ideal time for a buyer to consider a forward contract is:
- As soon as an offer is accepted
- When paying a large deposit in foreign currency
- When planning staged payments or phased construction
- When the completion date is several weeks or months ahead
It’s especially relevant in volatile markets — such as in 2025, where political uncertainty, interest rate speculation, and central bank divergence are all contributing to GBP and EUR volatility.
Why work with Optimal Currency?
At Optimal Currency, we specialise in international property transactions. We support both UK nationals buying abroad and foreign nationals purchasing in the UK, with tailored FX solutions and broker-led service throughout the process.
We work closely with agents and solicitors to:
- Provide compliant FX onboarding, including AML support
- Offer clients personal broker access (no call centres)
- Help clients lock in rates and manage staged payments
- Ensure funds are collected and settled efficiently, on time
We know how critical timelines are, especially when it comes to exchange and completion. That’s why we’re structured to support urgent payments, documentation turnaround, and client clarity at every step.
If you’d like to refer a client or discuss a partnership, we’re always happy to help.
For assistance for your clients, and to learn more about our services feel free to contact us
