When you acquire property in France from abroad, the exchange rate is rarely the first thing you think about. It is, however, one of the largest variables in the total cost of the transaction. A 5 % adverse move in EUR/USD or EUR/GBP between the moment you sign the compromis de vente and the moment funds are transferred to the notaire can represent tens of thousands of euros on a typical Riviera acquisition. This is also the dimension of the deal that buyers, focused on price and bank rate, tend to underestimate the most.
This overview describes how foreign exchange typically affects a French property acquisition from abroad, the main structuring solutions used by international buyers, and the role our team plays in coordinating the right partners.
Why FX matters in a French acquisition
In a cross-border acquisition, the buyer earns income in one currency (for example USD, GBP, CHF, NOK, SEK, AED, JPY, or CNY) and pays the seller, the notaire and the bank in euros. The euro amount is fixed by the contract ; the buyer's own-currency cost depends entirely on the exchange rate at the moment funds are converted.
Three FX exposures typically arise in the process :
- The down payment and notary fees. At the time of signing the compromis de vente, the buyer typically commits 5 % to 10 % of the purchase price as a deposit. At signing of the final deed, the down payment, the notary fees (approximately 7 % to 8 % on existing properties) and any registration tax are due, in euros, on a fixed date.
For a typical €1,000,000 acquisition financed at 70 % LTV, the buyer's own-currency cash requirement is approximately €390,000 (down payment plus fees). On this single moment, a 5 % adverse FX move equals approximately €19,500 of additional cost on the transaction.
Our preferred solution : 100 % financing of the property value
The most effective way to limit FX exposure on a French acquisition, for both standard files and HNWI profiles, is to finance 100 % of the property value in EUR. The bank covers the full purchase price ; the client converts only the closing costs (notary fees, registration tax, guarantee fees, approximately 8 % on existing properties) from their home currency to euros.
Concretely, on a €1,000,000 acquisition :
- Bank financing : €1,000,000 in EUR (100 % of the property value)
- Cash from client's own funds : approximately €80,000 to €90,000 for notary fees, registration tax and guarantee fees
The FX conversion the client must execute is therefore reduced from approximately €390,000 (under a 70 % LTV scenario) to approximately €80,000 to €90,000. The currency exposure of the client at acquisition is divided by approximately four to five. This is the single most impactful FX optimisation available, and it applies regardless of the size of the file.
How the 100 % structure works
For standard files, banks may agree to lend the full property value when the client’s profile and income justify it. The exact LTV authorised depends on each lender’s credit policy, the client’s income profile, and the file presentation.
For HNWI profiles, the 100 % financing is typically structured with a financial collateral pledged at the lending bank, in the client’s preferred currency (USD, GBP, CHF, NOK, SEK, AED, JPY, CNY and others, depending on the bank’s books). The principle :
- The bank lends 100 % of the property value in EUR
- The client funds a collateral account in their preferred currency, pledged in favour of the bank
- The collateral can be invested under the bank's discretionary or advisory mandate (typically in liquid instruments)
- The loan is serviced from the client's regular income or, where appropriate, from coupons and interest generated by the collateral
The client’s capital remains in their preferred currency, earning yield in that currency, while the property is acquired without any conversion of capital from USD / GBP / etc. into EUR. The FX risk on the principal is therefore largely neutralised at acquisition. This structure is offered by selected private banks and typically requires collateral commitments starting at €500,000 to €1,000,000. Each file requires individual review by the lending bank.
The closing costs (notary fees, registration tax, guarantee fees) remain payable in cash from the client’s personal funds in any structure. This is the only FX-exposed amount under the 100 % financing approach, and it is also the amount on which a forward contract is most cost-effective.
Optimising the FX conversion at notarial signing
For acquisitions that do not use the collateral-pledged structure (or for the down payment and notary fees component, which remains in cash in any case), the conversion from home currency to euros at the date of notarial signing is a significant moment. The amount in question is typically €250,000 to €500,000 or more.
Two practical considerations apply :
- Retail bank conversion is expensive. A typical retail bank applies a spread of 1 % to 3 % over the mid-market rate, plus fixed wire fees. On €400,000, this can represent €4,000 to €12,000 of explicit cost, before counting any timing risk.
- Specialised FX providers offer better rates. Regulated currency brokers and FX firms typically offer rates 50 % to 80 % tighter than retail banks, with the ability to lock a forward contract (typically up to 12 months ahead) so the EUR amount required at signing is fixed today.
Through our network, our team has access to a regulated FX partner based in London with whom international buyers can typically optimise both the rate (institutional pricing) and the execution (spot or forward). For a buyer concerned about the FX exposure on the notary fees and down payment, locking the rate via a forward contract at the time of the compromis can be one of the most cost-effective decisions of the entire acquisition.
The partner is independently regulated. We act as an introducer ; we do not execute FX trades, hold client funds, or act as a counterparty.
Notary fees and registration tax : a specific FX risk
For an existing property, notary fees and registration tax represent approximately 7 % to 8 % of the purchase price. On a €1,000,000 acquisition, this is approximately €70,000 to €80,000 in euros, paid on the day of the final deed.
This amount is :
- Fixed in EUR by the contract and the tax administration
- Due on a fixed date (the notarial signing date, generally 60 to 90 days after the compromis)
- Almost always paid in cash, not financed by the bank
For an international buyer, this is a textbook case for FX risk management. The amount and the date are known. The only variable is the rate at which the home currency is converted. A forward contract executed at the time of the compromis, locking the EUR amount required for the fees, eliminates this risk at typically marginal cost.
How Omage fits into the FX conversation
As a regulated Conseiller en Investissements Financiers (CIF) and mortgage broker, our role in a cross-border acquisition is to surface the FX dimension early in the conversation, to summarise the structuring options (collateral-pledged loan, forward conversion, EUR buffer), and to coordinate with the appropriate professionals : the lending bank for the credit, the FX partner in London for the conversion, and your tax counsel for the broader patrimonial framework.
We do not execute FX transactions. We do not hold client funds. We do not act as a counterparty. Our value is in identifying the FX dimension at the right moment, before commitment, and in connecting our clients with regulated specialists.