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The high street banks are squeezing overseas property investors for an average of more than £4,000 for every €200,000 they ‘buy’ according to foreign exchange broker Foremost Currency Group.

As the global economic situation appears to stabilise and investors tentatively return to the overseas property market, Foremost Currency Group is releasing findings from a series of ‘mystery’ calls to a selection of high street banks and foreign exchange specialists, disclosing the exchange rate offered to individuals wanting to ‘buy’ €200,000 (the approximate price of a 2/3 bed villa in rural France). The findings will not make for happy reading for investors that entrust international payments to their high street banks; buying a property worth €200,000 will cost them on average £178,303.09 versus £174,211.47 with a specialist broker.

Commenting on the findings, Robin McEwen, MD, Foremost Currency Group says, “Overseas property investors know that the quick returns characteristic of the late 90s and the ‘00s are a thing of the past, for the time being at least. However investors on tight budgets taking a long term view are returning to the market and financial institutions should be encouraging them to do so. By taking such a large margin on foreign exchange the high street banks are doing exactly the opposite.”

The ‘mystery’ calls were conducted on 22.08.09 from 10.30 to 10.45am (within a 15 minute window to prevent movements in the money markets skewing the results).

McEwen continues, “It’s not just the prospect of saving thousands that should tip the balance in favour of a specialist. A broker’s day job is to specifically monitor the money markets; high street banks on the other hand are split across a number of key remits and foreign exchange is not their primary focus.”

Getting through to an individual at the bank that could offer a genuine exchange rate was also difficult; it took more than 20 minutes to reach someone that could discuss foreign exchange in one case. McEwen comments, “By its very nature playing the exchange game requires swift action – if the markets move in your favour then you don’t want to wait an hour for the bank to confirm a rate they can actually stick to.”

“At Foremost Currency Group we have returned to the old-fashioned way of banking, where clients are allocated a personal account manager to look after their transaction from start to finish.”