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Is it a good time for Brits to sell up in Spain?

Property prices are falling (marginally) in Spain, and so is the Pound against the Euro (in higher proportions). What then do these two coinciding factors mean for British homeowners in Spain thinking about selling? Should they consider selling their homes now or should they wait to see how the exchange rate performs over the next twelve months or so?
In other words: is now a good time to sell your Spanish property?

British Pound vs Euro

A Glimpse At The Last 20 years

In July 2015, at its peak - considering the last 10 years only - 1 GBP was worth €1.44. Fast forward to July 2020, 1 Pound sterling equals 1.11 Euro, which is 23% less. Naturally, this has an impact on you, if you are a buyer, or seller, in a European country. Looking even further, when was the highest pound to euro rate ever achieved? Well, an all-time high of €1.75 occurred on 3rd May 2000.

Note: click
here to view the fluctuations between the British Pound to Euro Spot Exchange Rates (Bank of England)

The Coronavirus Crisis

The British Pound has suffered particularly badly in the wake of the coronavirus crisis. In recent weeks, Sterling has undergone one of the steepest declines in its history and one of the worst sustained periods of selling. Against both the Dollar and the Euro, the Pound has endured its worst weeks since the financial crisis of 2008.

The Good News: If You Sell Now, You Will Get A Higher GBP Total

As a result, when you sell property in Spain and repatriate the proceeds to the UK, you might get a higher GBP total than if you had done so at any time in the last few months, explains Peter Lavelle, a currency expert.

"Were you to transfer €500,000 at the EUR/GBP exchange rate of 0.91122, you'd get £456,100. By comparison, had you done so when you the Pound was at its strongest in recent years, in mid-February 2020 at a EUR/GBP exchange rate of 0.8310, you'd have got just £415,050. So that's a gain of £41,050 compared to if you'd sold your property four months ago!”

Lavelle adds: “The Euro has strengthened versus the Pound because the European Central Bank (ECB) continues to inject vast sums into the Eurozone's financial markets, to prop up the economy. This will support the bloc's economic cohesion in the coming months, as we bounce back from the COVID-19 crisis in the second half of 2020 and 2021."

Prices across Spain have fallen marginally in the last few months, but forecasters believe that sellers feel a more urgent need for liquidity and prices will drop further in the last quarter of the year.

The Pound has struggled to find any upward momentum against the Euro as hopes for more of the UK economy to open were undermined by concerns over a second coronavirus wave.

Brexit negotiations could also influence any movement in the GBP/EUR exchange rate, and most forecasters are predicting that a ‘no deal’ is increasingly likely. If little progress is made over the summer, the Pound could well come under even more pressure.