Exchange Rates & Property Purchase Pitfalls

Wow, a few chilly nights this week, lower than I have come to expect. If the temperature gets any lower I will have to resort to long sleeve shirts! Thankfully the daytimes are still very pleasant.

For the numerous british that thought they could find a cheap holiday on Madeira, the decline of the pound against the euro must have come as a bit of a shock. A quick check today shows that £1 will only buy €1.32. My source in Funchal tells me that numerous tourists are complaining about the rates they are getting, in some cases as low as 1.25 euros to the pound. Others who think they are doing better are probably paying a conversion charge for the privilege. The euro is pretty strong at the moment, but sterling is weakening also, having dropped around 10c against the US dollar in just a few months.

Finally the Xmas season here has ended! The day before yesterday I was walking around town with ‘Jingle Bells’ still being piped through the streets, and it must be even worse in Funchal, where Xmas starts a month earlier. 

Source : Diário de Notícias 16/1/2008

Interesting story today about a man in South Africa who brought 20,000 sq metres of land in Caniço (here on Madeira) to expand his international business interests. The deal was concluded in 2002 and he has all the necessary documents to prove it.  All was well until 2005 when someone approached him, also having the same documents of purchase but seemingly more valid than his. His efforts to resolve the situation have been unsucessful, so he is taking the Portuguese State to the Europen Courts, citing that the Conservatórias and Public Notaries, who are responsible for property registration and checking of property transactions made a mess of matters. Presumably someone also got paid twice for selling the same piece of land, so sounds like corruption here is still alive and well.

I remember well buying my place on Madeira several years ago. Quite extensive fees were payable for public notaries and registrations, as well as considerable purchase taxes. My solicitor at the time (unecessarily and without consulting me) paid bribes to public officials to ‘grease’ the purchase process, and then tried to add those costs to my purchase bill. I refused to pay them and we nearly ended up in court about it, and that’s aside from the fact that the solicitor tried to rip me off and didn’t do half the work supposed to be included in the agreed rip-off fee. And I have heard stories from others who had far worse experiences. It’s really important to make sure you get someone decent to manage property transactions, although theoritically you can do all the work yourself without the need for a solicitor / lawyer.

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