When Should You Transfer Your Overseas Savings if You’re Buying a Home in NZ?
With many Kiwis returning from overseas in the post-Covid era, buying a home back in New Zealand has become a top priority. But for those bringing foreign currency with them, one major question looms: when should you transfer your money into New Zealand dollars (NZD)?
The decision might seem small, but a few cents difference in the exchange rate can mean thousands added—or lost—from your deposit. Let’s explore how timing your currency exchange can influence your buying power and mortgage application.
Exchange Rates Can Make a Big Difference
Let’s say you’re returning from the UK with £100,000 in savings. If the exchange rate is 0.485 GBP/NZD, your funds convert to roughly NZD $206,000. But if the rate shifts slightly to 0.460, you’d only get NZD $195,600. On the flip side, if it rises to 0.547, you could land nearly NZD $218,000. That’s a difference of over $20,000 depending on timing.
These kinds of fluctuations aren’t unusual. Over the span of 18 months, it’s not uncommon to see a range like this play out—meaning your deposit can expand or shrink significantly depending on when you act.
Timing the Market: An Impossible Game?
Many returning expats hold off on exchanging their savings, hoping for a better rate. But the reality is, predicting currency movements is incredibly difficult—even for professionals with high-powered data models.
Exchange rates are volatile and driven by unpredictable global events. A sudden shift in interest rates by the Reserve Bank of New Zealand, a geopolitical shock, or changes in commodity demand can all move the NZD overnight.
Trying to guess the perfect time to exchange your money is, frankly, a gamble. And when your home deposit is on the line, it’s a risk you probably don’t want to take.
Why the Bank Wants Certainty
When applying for a mortgage, banks don’t deal in “maybes.” If your deposit is still in a foreign currency, the bank will apply a conservative estimate—typically reducing its NZD equivalent by 20% to account for currency risk.
So even if your current deposit is worth $205,000 in NZD, the bank might treat it as being only $164,000. That affects how much you can borrow. With a 20% deposit requirement, that difference could mean:
$164k deposit = approval for an $820k property
$205k deposit = approval for a $1.025m property
Converting your funds into NZD before seeking pre-approval eliminates this uncertainty and allows the bank to assess your application more favourably.
The Best Time? When You’re Ready for Pre-Approval
If you’re preparing to apply for pre-approval or actively looking for property, that’s the time to bring your money home. It may not be the perfect exchange rate, but it will give you certainty, clarity, and momentum.
Waiting too long can also delay your ability to make an offer on a property or meet the deposit requirement for auction or private treaty sales.
Choosing the Right Currency Exchange Service
While your local bank can transfer money, you may get a better rate and lower fees by using a specialist currency exchange provider. These services are often able to give you a more competitive rate—sometimes resulting in thousands of extra dollars in your pocket.
For example, some clients have reported up to 5% better results using dedicated FX providers versus high-street banks. On a £100,000 transfer, that could equate to an additional $10,000 NZD.
Certainty Beats Speculation
In the end, the best time to transfer your overseas funds is not when the rate is “perfect” (because you’ll never know when that is), but when you're ready to take the next step in buying a home. The certainty of knowing exactly how much you can borrow and the confidence to act quickly in the market far outweigh the potential gains from speculating on currency movements.
So if you're getting ready to apply for a mortgage and start your property journey in New Zealand, consider locking in your deposit now.
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