The Mortgage Norm in North Vancouver???
Apr 11th 2010, 9:01 pm
#1
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Thread Starter
Joined: Sep 2008
Location: England
Posts: 46
The Mortgage Norm in North Vancouver???
Hi,
My wife (who is Canadian) and I (and 2 boys) are in the process of getting our paperwork sorted to be able to emigrate to North Vancouver (ideally). We did a reccie trip last year, loved the place.
We would like some feedback on the norm for mortgages (size of etc) in the area. Initially we think it would be likely to move out without a job. I am in paper & packaging sales.
If we sell up in the UK we would be moving out with about CAN $550,000. Given the current exchange rate. The house prices in the area we are looking at are anywhere between $700k and $900k.
We would like to keep some $ in the bank to fund the 1st year so would want to put down a max of $400k. Is a $300 - 400k mortgage the norm in North Vancouver? We have chatted to a mortgage consultant and he indicated it would not be a problem getting a mortgage (from the new-to-Canada range) even without a job as long as we had a years worth of mortgage payments in the bank!
Suites seem a great idea to find a house with a 1 or 2 bedroom suite but obviously these are more expensive. Can the income be included in your income calculation?
How do the mortgage rules differ compared to what we are used to in the UK?
Any help, advice, experiences would be greatly appreciated.
Sorry this is so long-winded! Many thanks.
My wife (who is Canadian) and I (and 2 boys) are in the process of getting our paperwork sorted to be able to emigrate to North Vancouver (ideally). We did a reccie trip last year, loved the place.
We would like some feedback on the norm for mortgages (size of etc) in the area. Initially we think it would be likely to move out without a job. I am in paper & packaging sales.
If we sell up in the UK we would be moving out with about CAN $550,000. Given the current exchange rate. The house prices in the area we are looking at are anywhere between $700k and $900k.
We would like to keep some $ in the bank to fund the 1st year so would want to put down a max of $400k. Is a $300 - 400k mortgage the norm in North Vancouver? We have chatted to a mortgage consultant and he indicated it would not be a problem getting a mortgage (from the new-to-Canada range) even without a job as long as we had a years worth of mortgage payments in the bank!
Suites seem a great idea to find a house with a 1 or 2 bedroom suite but obviously these are more expensive. Can the income be included in your income calculation?
How do the mortgage rules differ compared to what we are used to in the UK?
Any help, advice, experiences would be greatly appreciated.
Sorry this is so long-winded! Many thanks.
Apr 11th 2010, 9:18 pm
#2
Binned by Muderators
Joined: Jul 2007
Location: White Rock BC
Posts: 11,683
Re: The Mortgage Norm in North Vancouver???
You shouldn't have a problem getting a mortgage on a $700K to $900k house if you are putting $400k down.
Banks vary about including rental income. Mine includes 2/3rds of gross rental income when calculating debt service ratios.
See here http://britishexpats.com/wiki/Mortgages-Canada
Banks vary about including rental income. Mine includes 2/3rds of gross rental income when calculating debt service ratios.
See here http://britishexpats.com/wiki/Mortgages-Canada
Apr 11th 2010, 11:10 pm
#3
Forum Regular
Joined: Feb 2007
Posts: 57
Re: The Mortgage Norm in North Vancouver???
You shouldn't have a problem getting a mortgage on a $700K to $900k house if you are putting $400k down.
Banks vary about including rental income. Mine includes 2/3rds of gross rental income when calculating debt service ratios.
See here http://britishexpats.com/wiki/Mortgages-Canada
Banks vary about including rental income. Mine includes 2/3rds of gross rental income when calculating debt service ratios.
See here http://britishexpats.com/wiki/Mortgages-Canada
For newcomers with no Canadian income the lenders would be looking for a minimum of 35% down payment. If you are self employed in the UK get a income verification letter from your accountant. If you are employed then your P45 should suffice.
Yes if you rent your basements (must be authorized) your property taxes will reflect this income potential and yes you have to declare the rental income in your annual tax return. The lender will take the rental potential but they will probably take into account vacancy periods.
My advice to you would be to rent for at least the first 6 -12 months, don't pressure yourselves into thinking that you are throwing away money renting and if you have a house in UK put off selling it until you are 100% sure you happy in Canada i.e. job, income, culture, schools, lifestyle, family isolation etc.
Apr 12th 2010, 12:01 am
#4
Joined: Dec 2008
Posts: 3,054
Re: The Mortgage Norm in North Vancouver???
Greetings - I live in the Lower Lonsdale Area of north Van. North Van is not cheap. I believe the more affordable area for detached homes would be the Lynn Valley area. 700 to 900 k is what a fairly standard home will cost, although i suspect closer to 900. Don't discount townhomes, they can be as big as houses, although with smaller gardens.
It is a nice area and an easy commute downtown for work. I agree that you should rent first till you get a feel for the area and get a decent paying job!!!. the further east you go, the cheaper it gets. Also Vancouver is not for everyone.
Many homes have basement suites to off-set the mortgage costs and the bank will accept a portion of the rental income as real income.
Do be aware that interest rates are starting to rise. prices are also the highest that they have ever been, with the average home in Vancouver proper hitting the one million mark.
It is a nice area and an easy commute downtown for work. I agree that you should rent first till you get a feel for the area and get a decent paying job!!!. the further east you go, the cheaper it gets. Also Vancouver is not for everyone.
Many homes have basement suites to off-set the mortgage costs and the bank will accept a portion of the rental income as real income.
Do be aware that interest rates are starting to rise. prices are also the highest that they have ever been, with the average home in Vancouver proper hitting the one million mark.
Apr 12th 2010, 12:21 am
#5
Born again atheist
Joined: Jul 2005
Location: Europe (to be specified).
Posts: 30,259
Re: The Mortgage Norm in North Vancouver???
I know nothing of North Vancouver, but I'd personally be extremely reluctant to take on a mortgage of the size you're contemplating without a job.
If you put $400k down on a $900k house, your looking at non tax deductable PIT payments of over $35K a year (a bit less at present but using a 5% rate doesn't seem unreasonable for forward planning purposes).
You'll need a gross income of well over $100k to support that. And guesiing from your username you're a family of four. Make that $150K.
This may be peanuts to you, I don't know, but until you have a job it could start to add up to a peanut mountain.
My advice: rent until you know (a) where you'll work and (b) how much you'll be making.
If you put $400k down on a $900k house, your looking at non tax deductable PIT payments of over $35K a year (a bit less at present but using a 5% rate doesn't seem unreasonable for forward planning purposes).
You'll need a gross income of well over $100k to support that. And guesiing from your username you're a family of four. Make that $150K.
This may be peanuts to you, I don't know, but until you have a job it could start to add up to a peanut mountain.
My advice: rent until you know (a) where you'll work and (b) how much you'll be making.
Apr 12th 2010, 12:50 am
#6
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Joined: Feb 2007
Posts: 57
Re: The Mortgage Norm in North Vancouver???
Couldn't agree more with Novocastrian, salaries in Vancouver mainland are generally lower compared to the higher cost of living. There are exceptions off course for different professions.
To make $100k - $150k gross income is not an easy task to begin with especially when one is new in the country. If you are sales you have a better prospect of perhaps making that kind of money but it will take a while especially in a small town like Vancouver.
I have been in North Van for 18 mths and overall my experience has been very positive except for the cost of living and the lower wages goes against newcomers in terms of becoming established and financially stable. 10yrs ago it was not quite bad, the same properties which are $900k were going for $200-300k.
My advice is don't give your savings to the banks! just keep it banked and test the waters first before committing yourself with a hefty mortgage and quite high property carrying costs i.e Property Taxes for a $900k property is likely to be in the region of $4-5k per year.
There is also the additional cost of HST which is going to start this July whereby everything that is being taxed GST 5% will be charged at 12%.
To make $100k - $150k gross income is not an easy task to begin with especially when one is new in the country. If you are sales you have a better prospect of perhaps making that kind of money but it will take a while especially in a small town like Vancouver.
I have been in North Van for 18 mths and overall my experience has been very positive except for the cost of living and the lower wages goes against newcomers in terms of becoming established and financially stable. 10yrs ago it was not quite bad, the same properties which are $900k were going for $200-300k.
My advice is don't give your savings to the banks! just keep it banked and test the waters first before committing yourself with a hefty mortgage and quite high property carrying costs i.e Property Taxes for a $900k property is likely to be in the region of $4-5k per year.
There is also the additional cost of HST which is going to start this July whereby everything that is being taxed GST 5% will be charged at 12%.
Apr 12th 2010, 12:53 am
#7
Joined: Aug 2005
Posts: 14,227
Re: The Mortgage Norm in North Vancouver???
I know nothing of North Vancouver, but I'd personally be extremely reluctant to take on a mortgage of the size you're contemplating without a job.
If you put $400k down on a $900k house, your looking at non tax deductable PIT payments of over $35K a year (a bit less at present but using a 5% rate doesn't seem unreasonable for forward planning purposes).
You'll need a gross income of well over $100k to support that. And guesiing from your username you're a family of four. Make that $150K.
This may be peanuts to you, I don't know, but until you have a job it could start to add up to a peanut mountain.
My advice: rent until you know (a) where you'll work and (b) how much you'll be making.
If you put $400k down on a $900k house, your looking at non tax deductable PIT payments of over $35K a year (a bit less at present but using a 5% rate doesn't seem unreasonable for forward planning purposes).
You'll need a gross income of well over $100k to support that. And guesiing from your username you're a family of four. Make that $150K.
This may be peanuts to you, I don't know, but until you have a job it could start to add up to a peanut mountain.
My advice: rent until you know (a) where you'll work and (b) how much you'll be making.
- ok that might not be strictly accurate, but the amount of future income that people here like to give the banks is staggering.
Last edited by Alan2005; Apr 12th 2010 at 12:58 am.
Apr 12th 2010, 1:09 am
#8
Born again atheist
Joined: Jul 2005
Location: Europe (to be specified).
Posts: 30,259
Re: The Mortgage Norm in North Vancouver???
ah, but in Vancouver people think nothing of getting mortgages of $500k, $600k, or even higher so they can buy a poxy starter home. They just love being in debt. Of the $1.3 trillion consumer debt in Canada those in BC owe $1.29 trillion of it and it's all secured against rabbit hutches - ok that might not be strictly accurate, but the amount of future income that people here like to give the banks is staggering.
- ok that might not be strictly accurate, but the amount of future income that people here like to give the banks is staggering.
Apr 12th 2010, 1:12 am
#9
Born again atheist
Joined: Jul 2005
Location: Europe (to be specified).
Posts: 30,259
Apr 12th 2010, 1:14 am
#10
Joined: Dec 2008
Posts: 3,054
Re: The Mortgage Norm in North Vancouver???
Couldn't agree more with Novocastrian, salaries in Vancouver mainland are generally lower compared to the higher cost of living. There are exceptions off course for different professions.
To make $100k - $150k gross income is not an easy task to begin with especially when one is new in the country. If you are sales you have a better prospect of perhaps making that kind of money but it will take a while especially in a small town like Vancouver.
I have been in North Van for 18 mths and overall my experience has been very positive except for the cost of living and the lower wages goes against newcomers in terms of becoming established and financially stable. 10yrs ago it was not quite bad, the same properties which are $900k were going for $200-300k.
My advice is don't give your savings to the banks! just keep it banked and test the waters first before committing yourself with a hefty mortgage and quite high property carrying costs i.e Property Taxes for a $900k property is likely to be in the region of $4-5k per year.
There is also the additional cost of HST which is going to start this July whereby everything that is being taxed GST 5% will be charged at 12%.
To make $100k - $150k gross income is not an easy task to begin with especially when one is new in the country. If you are sales you have a better prospect of perhaps making that kind of money but it will take a while especially in a small town like Vancouver.
I have been in North Van for 18 mths and overall my experience has been very positive except for the cost of living and the lower wages goes against newcomers in terms of becoming established and financially stable. 10yrs ago it was not quite bad, the same properties which are $900k were going for $200-300k.
My advice is don't give your savings to the banks! just keep it banked and test the waters first before committing yourself with a hefty mortgage and quite high property carrying costs i.e Property Taxes for a $900k property is likely to be in the region of $4-5k per year.
There is also the additional cost of HST which is going to start this July whereby everything that is being taxed GST 5% will be charged at 12%.
Apr 12th 2010, 1:15 am
#11
Joined: Dec 2008
Posts: 3,054
Re: The Mortgage Norm in North Vancouver???
Couldn't agree more with Novocastrian, salaries in Vancouver mainland are generally lower compared to the higher cost of living. There are exceptions off course for different professions.
To make $100k - $150k gross income is not an easy task to begin with especially when one is new in the country. If you are sales you have a better prospect of perhaps making that kind of money but it will take a while especially in a small town like Vancouver.
I have been in North Van for 18 mths and overall my experience has been very positive except for the cost of living and the lower wages goes against newcomers in terms of becoming established and financially stable. 10yrs ago it was not quite bad, the same properties which are $900k were going for $200-300k.
My advice is don't give your savings to the banks! just keep it banked and test the waters first before committing yourself with a hefty mortgage and quite high property carrying costs i.e Property Taxes for a $900k property is likely to be in the region of $4-5k per year.
There is also the additional cost of HST which is going to start this July whereby everything that is being taxed GST 5% will be charged at 12%.
To make $100k - $150k gross income is not an easy task to begin with especially when one is new in the country. If you are sales you have a better prospect of perhaps making that kind of money but it will take a while especially in a small town like Vancouver.
I have been in North Van for 18 mths and overall my experience has been very positive except for the cost of living and the lower wages goes against newcomers in terms of becoming established and financially stable. 10yrs ago it was not quite bad, the same properties which are $900k were going for $200-300k.
My advice is don't give your savings to the banks! just keep it banked and test the waters first before committing yourself with a hefty mortgage and quite high property carrying costs i.e Property Taxes for a $900k property is likely to be in the region of $4-5k per year.
There is also the additional cost of HST which is going to start this July whereby everything that is being taxed GST 5% will be charged at 12%.
Apr 12th 2010, 1:15 am
#12
Joined: Aug 2005
Posts: 14,227
Re: The Mortgage Norm in North Vancouver???
I'm surprised more hasn't been made of this by developers. Maybe they think people won't care and will continue stumping up stupid sums of cash .... they may well be right!
Apr 12th 2010, 1:18 am
#13
Joined: Dec 2008
Posts: 3,054
Re: The Mortgage Norm in North Vancouver???
ah, but in Vancouver people think nothing of getting mortgages of $500k, $600k, or even higher so they can buy a poxy starter home. They just love being in debt. Of the $1.3 trillion consumer debt in Canada those in BC owe $1.29 trillion of it and it's all secured against rabbit hutches - ok that might not be strictly accurate, but the amount of future income that people here like to give the banks is staggering.
- ok that might not be strictly accurate, but the amount of future income that people here like to give the banks is staggering.
Apr 12th 2010, 1:19 am
#14
Born again atheist
Joined: Jul 2005
Location: Europe (to be specified).
Posts: 30,259
Apr 12th 2010, 2:42 am
#15
Forum Regular
Joined: Feb 2007
Posts: 57
Re: The Mortgage Norm in North Vancouver???
The bottom line is Vancouver locals are being squeezed both by the employers and the politicians because most are immigrants from developing nations and don't know any better and as a result no one is inclined to even make a sound. There are no pay rises either, people are on the same salary for 5yrs! and should they want to move there isn't much going on around, the private sector is all family owned Maa and Paa shops and the big enterprises are either Government or a Crown agency which are all unionized.
The typical example was the MSP went up by 6% and there was not even a mention in the media about this expected rise until it got slapped on 1st Jan 2010.
For individuals who are planning to emigrate to Canada and in particular to Vancouver from the UK should keep in mind that no matter how everyone winged and complains how bad UK is my personal experience now having spend about 2yrs living here I can compare the two and can strongly say that Canada and for that matter the US are far behind UK in many respects and have a long way before they will be able to catch up.
And yes the consumer debt is on the rise as more people are getting onto the bandwagon of wanting to get rich in the property boom which is fueled by only hot air!