jamesmacc

Still not heard back from SINP but my application has been submitted and told it will be about 5 or 6 months. We own a house in UK and want to buy as soon as we know if we are going to settle or not. I spotted a few houses about 30 mins out of regina (were i will work) at about $600,000 . I thought with the money ill have after paying mortgage off in uk couple with my salary i might be able to afford something like that if the mrs gets a job too.
After my 1 st year with overtime i should manage about $75,000 a year, i typed in $600,000 mortgage into a mortgage calculator and it said i would need a salary of $150,000 to qualify. So i thought well maybe i can afford something around $400,000 and its still saying i would need a salary of £115,000.
Should i just get over it and accept the fact i wont be able to afford to buy outside of regina or is there anyone on here managed to get a similar mortgage on similar wages ?

don't take this wrong im not a snob looking at 600k houses i was simply dreaming and wondered what it would take income wise to fund such a place

Danny B

An affordable mortgage should be 3.5x your household income.

Jericho79

Depends how much equity you put down.
With 5% down, on $100k salary, i would budget for a max of $380-390k. Once you add property taxes, etc, your mortgage is likely to be in the $2,500 p/month range, which would be almost half your salary. And a house that big will be expensive to heat, especially in the winter.

Almost Canadian

IIRC lenders will lend an amount that means your monthly payments will not exceed 40% of your gross monthly income.

On an income of $75,000, I would not wish to have a mortgage of more than $250,000.

jamesmacc

kind of that , should have worked this out before i decided to move . we spend 50% of our salary on payments just now in the UK

Jericho79

I moved to Canada on a salary in the $75k range, and it was a real struggle- pretty much living paycheck to paycheck. No savings. No vacations. One car.
Granted, I have two young kids, but if $75k is the top end of what you're expecting to earn, I would definitely have a rethink about moving.

jamesmacc

well im renting out my house in the UK while im gone so i guess i can treat it as a working holiday and return to the UK in 3 or 4 years if i cant afford a similar house in Sask, atleast ill still be paying my mortgage so even though im spending a lot of money on rent in Regina i will be lowering my mortgage in the UK

Jericho79

That wont really have much impact on the overall cost of living and your outlay here in Canada. If your missus is planning to work, that's a different story. $75k probably equates to a decent british salary, and that's the mistake I made when we came over, but it's not a lot of money here.

jamesmacc

she cant work for a while as we will have a 12 week old baby. after a year or so we could look at childcare and her getting a job. she is a teacher here in the UK

Tirytory

Surely Regina isn't that expensive to live in? .... My husband earns a very respectable salary...more than the $115 000 you are talking about and we had a deposit to put down but wouldn't have contemplated that figure house purchase. I came here to live here not spend money on a mortgage... We have a perfectly beautiful wow house here in cottage country (read expensive) in Ontario which was not anywhere close to that top figure of yours. It has it's compromises but what house doesn't in reality? Other things we should have thought about in purchasing... Propane bill in winter for heating those vaulted ceilings, maintenance of that extra outdoors grounds, hot tubs are not cheap to run, length and steepness of driveway and snow clearance... Not to mention taxes.

I think it's easy to get caught up in the dream of a "canadian" house... But stop looking at the expensive gorgeous ones, bring yourself back down to Earth and then maybe get used to what you can afford to buy.... You might be pleasantly surprised!

Jericho79

Dont want to put a dampner (sorry), but you should probably rule out teaching. Canada is way-over supplied with teachers, and the industry is notoriously difficult to get in to. A Uk teacher, with no canadian experience- not impossible, but very unlikely.

dbd33

A story I know to be true concerns someone who did that. The main reason for renting the house out being that it was worth less than the mortgage owing on it. Initially things went well but then the tenants left. The house was then worth even less so selling it wasn't an option. It also needed redecorating so there was a period with no tenant and the cost of paint and whatnot. Once that was done, but before new tenants were found, passers-by broke in and stole the plumbing. They left the water running causing a great deal of damage. The house was then worth even less.

This situation is common enough that there are firms of people who negotiate with the mortgage holder to split the shortfall when the house is sold. The owner can then walk away owing only a few tens of thousands of pounds to the bank and a couple of grand to the negotiator. That's grim but it's better than being stuck with a house in another country.

This doesn't happen to everyone, some people rent out houses happily for years (I know someone who left the UK in 80s and still has the same tenant in the house he left behind) but it's a cautionary tale. I suggest that, when moving abroad and renting out the house at home, one needs a financial cushion to support the house.

I don't think $C75,000 provides such a cushion and would be nervous about that. Separately, I think people who are not in fear of their lives in their home countries who elect move to Regina want their heads examined, but each to his own.

Tirytory

I thought teachers were in the same category as nurses and police officers in Canada...exceptionally awkward to get into profession?

rivingtonpike

What would you be coming here to do? If you treat the experience as a very expensive life adventure then great. But on $75k, unless your wife can work as well, I'm not sure how many of Canada's glories you're going to enjoy. I'm not sure where you're coming from either and so what rental income you're likely to get from your UK house. If you're renting in SW London and getting $4000 a month on a property with a comparatively small mortgage and you can treat the difference as (taxed) income, then maybe it's do-able. But if not.......

withabix

We've just gone for a $615k house on a salary of over $100K but I did put down $160k (making a mortgage of $458k after adding COMPULSORY mortgage indemnity insurance) and I've still got an inherited apartment in the UK to sell, which will cover off about 60% of the mortgage.

We got a 5 year fixed rate of 2.74% (Scotiabank - these rates aren't the advertised rates) - this gives $2108/month repayment on 25 year amortisation.

This is the upper limit of my comfort zone without my wife working and ignoring the value of the UK property (ie cautious assumptions), on the basis that at the end of the 5 year fix, rates could be double or more and there could be falls in house prices in the future.

You won't get amortisation of more than 25 years until you get Citizenship iirc.

CMHC recommends your mortgage payment + property tax is not more than 35% of your Gross income (which equates to about 50% of net income after taxes).

There are reasons why many houses have legal (and illegal) secondary suites.....although we didn't go down that route.