What could we afford?

[Dorsetbrit]

Was just wondering what sort of rental budget then later to buy on expected earnings jointly of £150,000 to £200,000 a year in Brisbane south or north not in the centre. Or any suggestions on what areas suit that budget.

 

Thank you kindly. Darren.

[Guest The Pom Queen]

Hi @Dorsetbrit it’s hard to say which area to choose as it is all personal preference, ie are schools required, do you want country/beach, where will you be working in the city/suburbs, how far are you willing to commute, will you need public Transport, do you want a new build or old build, if renting first are you looking at buying in that area (the reason I ask this is that when we came over we made the mistake of renting somewhere we could never afford to buy).

Sorry for all the questions.

In regards to how much you should be able to borrow, now that is hopefully an easy question now we have a financial advisor and mortgage broker on here, I can vouch for them first hand as they got us our mortgage when others couldn’t help. Hopefully @Carol from Vista Financial Or @Andrew from Vista Financial Will see your message here otherwise you could send them a message. Vista Financial went above and beyond for us.

 

[Dorsetbrit]

I feel my question was a bit silly now, your right so many factors. I guess I was seeing what would be an appropriate budget to for renting if we were on around 12000 per month, that way we could at least look at what areas we could afford.
Sounds like you wouldn’t waste time renting? We’d hope to sell our house and have 100k sterling to invest in an Australian property once we know we’ve settled and all is well ( not to much home sickness I hope) seems logical to rent I thought.

[Andrew from Vista Financial]

Hello Dorsetbrit

Don't worry so much to think about and just not knowing things you feel you should or want to know is frustrating but it will all slot together in time.

Have a look here at our borrowing power calculators, just bear in mind these are just a guide and that what they tell you know could be very different to what they tell you when you arrive as things change such as banks lending policies and interest rates (as they are connected to borrowing power here): http://www.vista.financialknowledgecentre.com.au/kccalculators.php?id=1

Also this is a good one for costs of buying a house (note that foreign purchaser should be YES if temporary residents): http://www.vista.financialknowledgecentre.com.au/kccalculators.php?id=19

Hope this helps a bit.

Regards

Andy

[Dorsetbrit]

That’s very interesting thank you. What sort of deposits are needed?

[Guest The Pom Queen]

15 hours ago, Dorsetbrit said:

I feel my question was a bit silly now, your right so many factors. I guess I was seeing what would be an appropriate budget to for renting if we were on around 12000 per month, that way we could at least look at what areas we could afford.
Sounds like you wouldn’t waste time renting? We’d hope to sell our house and have 100k sterling to invest in an Australian property once we know we’ve settled and all is well ( not to much home sickness I hope) seems logical to rent I thought.

@Dorsetbrit your question wasn’t silly at all. No question is silly, you should have seen all mine when we were moving over.

I think we just forget how large Australia is. 

‘I would highly recommend renting prior to buying. It gives you time to settle in an area, look around others and find employment. There are well over 450 suburbs in Brisbane. Then you have all the outer areas, Lockyer Valley, Sunshine Coast, Gold Coast.

When renting a property the agents usually look at not more than 30-40% of your income for rent. Anything more and you are likely to be refused. So based on $12,000 you would be able to budget up to $4,800 a month. I wouldn’t recommend stretching yourself so much, you can rent some beautiful 4 bed houses for $400 a week.

Have a look here for some areas and ideas https://www.pomsinoz.com/articles.html/where-to-live-in-australia/queensland/

 

 

 

[Dorsetbrit]

We would like a nice place with a pool and I know it will depend on the area you live, we’re really only at the start as we were told the wife needed superior in the language test which she now has so she will now get assessed. She’s an accountant so not easy but hoping for a 189 on 75 points[emoji45] in the mean time I’ve Skyped an employer in oz and I might get a job offer through in a few weeks if all went well, I’m landscaper self employed for 17 years so we’re not sure where it will leave us after that. Visas are a mine field. We want the quickest rout but I need at least 3 year visa to start or I don’t think I’d settle so permanent is really for us. Just wish there was an easier way but I know it will be a long process. We’ll get a Mara agent once we have been skill accessed. We’ve contacted two but say not much we can do until assessed.
See how we go just nice to budget for the future.

Thank you for responding.

[Guest The Pom Queen]

21 minutes ago, Dorsetbrit said:

We would like a nice place with a pool and I know it will depend on the area you live, we’re really only at the start as we were told the wife needed superior in the language test which she now has so she will now get assessed. She’s an accountant so not easy but hoping for a 189 on 75 points in the mean time I’ve Skyped an employer in oz and I might get a job offer through in a few weeks if all went well, I’m landscaper self employed for 17 years so we’re not sure where it will leave us after that. Visas are a mine field. We want the quickest rout but I need at least 3 year visa to start or I don’t think I’d settle so permanent is really for us. Just wish there was an easier way but I know it will be a long process. We’ll get a Mara agent once we have been skill accessed. We’ve contacted two but say not much we can do until assessed.
See how we go just nice to budget for the future.

Thank you for responding.

It is early days for you and there is so many stages and hurdles to jump. I can say for us it was worth it all (I don’t think I said that back then lol). The process was a very long 4 years for us.

As you said, getting the visa is your main priority, who knows you may end up getting your visa but deciding to try another state. 

‘I definitely think you are doing the right thing in getting advice and seeing what your quality of life will be like here. Have you had a look at realestate https://www.realestate.com.au/rent this is the main website for buying and renting. 

‘Your budget would get you a 2 bed apartment in the CBD overlooking the river https://www.realestate.com.au/property-apartment-qld-south+bank-423925146

A 4 bed new build luxury resort in Brookwater https://www.realestate.com.au/property-house-qld-brookwater-421946974 

Or acreage https://www.realestate.com.au/property-acreage+semi+rural-qld-mundoolun-423861926

Now obviously you could rent cheaper and you could increase your budget higher,  but what I’m trying to show you is that you have lots and lots of choice, unfortunately for you too much lol. 

‘I remember when we started looking I would see posts asking which is the best Suburb and if three people said the same place it went on my list. I spent 4 years choosing areas based on others opinions and google maps. When we arrived we preferred somewhere totally different.

 

[Dorsetbrit]

When we visited we were lucky enough to have friends in the north so did a fair bit of driving around and like so much so like you say set up base temporarily then spend weekends driving around and see what suits to our jobs.
I expect wife will be in CBD but I’ll be in suburbs plus we will have a sixteen year old from a previous relationship and a 1 year old. Lots to arrange and just hope we can get our EOI in as soon as possible then at least the ball is rolling.
I take it you don’t regret the move? Things are getting very toxic in England and when we visited Australia we didn’t want to come home. If it wasn’t for the flight I’d do another holiday but really I’d like the next time to be a one way ticket.

[Tootsie]

On 30/05/2018 at 03:39, Dorsetbrit said:

 

Was just wondering what sort of rental budget then later to buy on expected earnings jointly of £150,000 to £200,000

Wow.

That is a nice wage

If I have worked it out correctly, then £200,000 is about $352,000

That is a pretty good income for many people, especially in Queensland

A friend lives in Kangaroo Point in Brisbane (although won't suit you, as you said not centre) but I can only tell you about it, from first hand experience

She rents a fantastic really modern unit with views for $500.00 per week. Single parent with one child. She does not need to keep a car, as she walks to her job in the CBD.

There is another suburb on the outer fringes that many people rave about. Cannot remember the name presently. It is ruralish. But people commute into Brisbane CBD daily.

[Tootsie]

On 31/05/2018 at 20:47, Dorsetbrit said:

I take it you don’t regret the move? Things are getting very toxic in England and when we visited Australia we didn’t want to come home.

Hello

I personally have never regretted the move.

I visited Australia twice for holidays before making the permanent move..... and I was always depressed to return to the UK in between too.

I love it here. And the happiest day of my life, was the day I got my permanent resident visa (and then citizenship a few years later)

I made sure I embraced everything Australian upon my arrival. I didn't seek out English friends. I didn't have packets of Oxo gravy sent out from the UK. I didn't read the International Express newspaper. I didn't constantly compare prices between the two countries. I just totally embraced my new way of life, and happily settled in very quickly as a result.

Good luck to you. Hope everything works out well for you too.

[Dorsetbrit]

Sounds amazing and exactly how we intend to do things. Just need to get our foot in the door. Things are pretty rubbish in the uk and with Brexit coming I’m sure they will be worse for a while. Time for anew life down under.

[Dorsetbrit]

Wow.
That is a nice wage
If I have worked it out correctly, then £200,000 is about $352,000
That is a pretty good income for many people, especially in Queensland
A friend lives in Kangaroo Point in Brisbane (although won't suit you, as you said not centre) but I can only tell you about it, from first hand experience
She rents a fantastic really modern unit with views for $500.00 per week. Single parent with one child. She does not need to keep a car, as she walks to her job in the CBD.
There is another suburb on the outer fringes that many people rave about. Cannot remember the name presently. It is ruralish. But people commute into Brisbane CBD daily.

We would earn $150,000 between us, wish it was the higher amount!

[Guest Carol from Vista Financial]

On 31/05/2018 at 17:35, Dorsetbrit said:

That’s very interesting thank you. What sort of deposits are needed?

Hi @Dorsetbrit

My notifications and I had a disagreement so I only just saw your post sorry!

Lucky @Andrew from Vista Financial had no such problems

Deposit wise to purchase a house having 20% of the purchase price (plus costs) means you have the most bargaining power with the banks and also means you would avoid paying lenders mortgage insurance, which is a premium payable to protect the bank if you borrow more than 80% of the property price. It can be very expensive so if you can save to avoid it that would obviously be ideal.

Also good to bear in mind that if you intend to continue working self employed when you arrive that most banks will want to see 2 years financials prior to lending. There are some that may accept 1 years tax returns plus BAS but to keep all options open just keep in mind that rough time frame. If you work as an employee then it is different of course. As @Andrew from Vista Financial mentioned each lender has its own lending policy and some may be a bit more lenient if you continue to work in the same industry that you have been for the last 17 years. They all like to put their own spin on policy so best just check again once you have your employment contract.

Please have a look at my post here to read more about purchasing in Oz:

Definitely agree with @The Pom Queen that renting can be useful in the first instance to get a real idea of where you would like to live before committing to a mortgage.

If you have any other questions don't be afraid to ask!

 

Warm regards

Carol

 

[Ferrets]

On 31/05/2018 at 19:54, Dorsetbrit said:

We would like a nice place with a pool and I know it will depend on the area you live, we’re really only at the start as we were told the wife needed superior in the language test which she now has so she will now get assessed. She’s an accountant so not easy but hoping for a 189 on 75 points in the mean time I’ve Skyped an employer in oz and I might get a job offer through in a few weeks if all went well, I’m landscaper self employed for 17 years so we’re not sure where it will leave us after that. Visas are a mine field. We want the quickest rout but I need at least 3 year visa to start or I don’t think I’d settle so permanent is really for us. Just wish there was an easier way but I know it will be a long process. We’ll get a Mara agent once we have been skill accessed. We’ve contacted two but say not much we can do until assessed.
See how we go just nice to budget for the future.

Thank you for responding.

I definitely recommend renting, if only to work out what area you like - although parents have always thought buying quickly was the right idea the cost of buying and selling in a short time-frame is a bit prohibitive if you buy in the wrong place!

Going a little off thread topic suggest that it might be worth consulting a MARA agent now due to a couple of points; 1) At the moment 75 points won't cut it for an accountant, but there is a backlog of 80+ at the moment (accountants not currently being invited) and 2) you have mentioned in another post that you have a 16 year old from a different relationship which can have it's own complications.

Given the low cost of an initial consultation would recommend that as a priority to make sure you have the optimum strategy for your circumstances in place.  If your wife is chartered then assessment should be straightforward, and shouldn't delay speaking with a MARA agent - in fact some of the agents that post here are accountants!

Best of luck sorry for going off topic 

 

[Ferrets]

On 02/06/2018 at 17:38, Dorsetbrit said:

We would earn $150,000 between us, wish it was the higher amount!

 

On that you could assume a maximum borrowing capacity of approx AUD $700k - $750k, in addition to what you have as a deposit from the UK.

Individual circumstances would affect that, and you also need to factor in stamp duty, etc. but should allow you to start having a look at what that could buy in certain areas.

Good luck!

[Dorsetbrit]

I definitely recommend renting, if only to work out what area you like - although parents have always thought buying quickly was the right idea the cost of buying and selling in a short time-frame is a bit prohibitive if you buy in the wrong place!
Going a little off thread topic suggest that it might be worth consulting a MARA agent now due to a couple of points; 1) At the moment 75 points won't cut it for an accountant, but there is a backlog of 80+ at the moment (accountants not currently being invited) and 2) you have mentioned in another post that you have a 16 year old from a different relationship which can have it's own complications.
Given the low cost of an initial consultation would recommend that as a priority to make sure you have the optimum strategy for your circumstances in place.  If your wife is chartered then assessment should be straightforward, and shouldn't delay speaking with a MARA agent - in fact some of the agents that post here are accountants!
Best of luck sorry for going off topic [emoji6]
 

We went to two Mara agents and one told us about several different option but not to worry until she’s had her skills assessed, and best to go for 189 and the points will drop in time.
The second didn’t want to know until her skills were assessed.
I know having a daughter from another relationship is tricky but we have her mother’s permission and she’s very keen to go so just have to take it one step at a time. The wife said she needs to get together a while load of paper work for the assessment so not a five minute job. I’m not even sure what you get at the end of it?

[Ferrets]

5 hours ago, Dorsetbrit said:

We went to two Mara agents and one told us about several different option but not to worry until she’s had her skills assessed, and best to go for 189 and the points will drop in time.
The second didn’t want to know until her skills were assessed.
I know having a daughter from another relationship is tricky but we have her mother’s permission and she’s very keen to go so just have to take it one step at a time. The wife said she needs to get together a while load of paper work for the assessment so not a five minute job. I’m not even sure what you get at the end of it?

After assessment you get an approved or not status, but can also include a review of skilled work to establish points.  Note you will also need to have finished the IELTS exam as well prior to assessment.

You are right about the amount of paperwork, but it can be used multiple times.  Around work mine took 5 months to pull together, but that included a detailed work description  (even then I got 5 less points for experience than I assumed) and I needed to chase my Uni for copies of an old transcript and syllabi.

All in the cost was around £1500 but that did include CPA Australia membership (I used the same paperwork to get reciprocal membership).

A lot to do but very worth it.

Good luck.

 

[s713]

Just my opinion, and I have no idea about what deposit you would have but, personally, I wouldn't borrow 750k on a 150k salary, too expensive. I know rates are low but they won't be for ever.

[Ferrets]

6 hours ago, s713 said:

Just my opinion, and I have no idea about what deposit you would have but, personally, I wouldn't borrow 750k on a 150k salary, too expensive. I know rates are low but they won't be for ever.

We have just got a mortgage and they were stress testing our monthly spend with a massive hike in interest rates.  I think on 150k it would be closer to 700k max (our theoretical borrowing limit came down by having credit cards, etc).

I do not see any long term downturn in Brisbane house prices coming - overseas migration to Sydney and Melbourne is driving interstate movement to Brisbane and that is not going to change, so if you find an area you like I think it makes sense to stretch a bit at the moment.  I could of course be wrong though 

 

[Dorsetbrit]

Yeh some good advise I just need to get over first I miss it so much. I think rent for 6 months and if we’re still all good buy somewhere after lots of research and I’m sure we’ll get told what we can borrow then take it from there. So much to sort first seems stupid discussing but I also need to know what money I could accept with a job offer so all worth knowing.

[Guest Carol from Vista Financial]

On 05/06/2018 at 19:19, Dorsetbrit said:

Yeh some good advise I just need to get over first I miss it so much. I think rent for 6 months and if we’re still all good buy somewhere after lots of research and I’m sure we’ll get told what we can borrow then take it from there. So much to sort first seems stupid discussing but I also need to know what money I could accept with a job offer so all worth knowing.

@Dorsetbrit Not stupid to be thinking about it at all, good to be prepared as much as you can.

Just keep in mind that the mortgage industry is under the spotlight at the moment due to the banking royal commission and things that may have been possible under bank criteria even a few months ago may be harder or not possible in the future. Things are changing that rapidly. You may well find the criteria may be more stringent by the time you are ready to buy.

Long story short, wait until you know the details of your job/circumstance then seek a fully assessed pre-approval from a lender. I would suggest doing this before getting too caught up in the research to avoid disappointment if you get your heart set on an area you can't afford.

Important to note that unless you have an official fully assessed pre-approval letter from a bank, the amount you can borrow is still just an educated guess. I stress the words "fully assessed" here. There are some banks that offer pre-approvals that are not fully assessed which means yes we are happy to lend to you subject to your income, valuation, full analysis of your application etc. etc. (i.e. we haven't actually assessed it, but come back to us later and we will do it properly!) These types of 'pre-approvals' are not worth the paper they are written on, can give a false sense of security, and keep you open to more risk so just be aware.

As @Ferrets mentioned, every bank does have its own 'stress testing' built into their application process. In terms of rate they assess your ability to repay on 2.5% above the current rate (so 7.25% for most). Some even assess at 8%, depends on the lender. This is just one example but is designed to ensure you can repay even if rates go up as obviously it is in the banks interest that you pay them back!

That being said keep in mind that whilst it may be ok on paper, you also need to be comfortable with repayments assuming worst case scenario. Seeing the money actually go out of your bank account is very different to being told the calculations say you can afford it.

@s713 is right, rates are lower than they have been in over decades, but what goes down must come up. But as to when, that is a crystal ball question. Alot of economists would be out of job if there was an easy answer. If this is something that concerns you, or you would prefer the certainty of knowing your repayment then a prudent lender should discuss fixed rate options with you - both pro's and con's.

All the best with the research! Keep us posted

 

Warm regards

Carol