Moving to Finland w/ Continuous RP and Mortgage?

[priki]

I just cannot believe how expensive apartments can be in Helsinki...
That apt would mean about 2300-2700€/month to the bank (more when the interest rates rise) and over 500€/month to the housing company. Lots of renovations still coming this and next year. Plus electricity, which of course is peanuts compared to the other expenses. Huh. The monthly loan payment is about the size of my monthly net income, as a senior salaried MSc with 15 years work experience. Rich people really are rich...

[onkko]

So you dont have a guestion, what you want to know?
This is not "whine about price"

[Rip]

This particular unit interests me a lot.

Well, can you indicate what kind of income you could show to the bank? The great majority of people already living in Helsinki would be rejected by (any) bank (excluding the fact that I could put, if I wanted, lot more than 30%, yours truly as well) because they would not be considered to have sufficient or stable enough income.

The fact you'd be a recent immigrant must make things more difficult, but the categorization between "unrealistic fool" and "a very good long term customer" must still depend mostly on the source and quantity of money you're making.

[alexnicolas]

This particular unit interests me a lot.

Well, can you indicate what kind of income you could show to the bank? The great majority of people already living in Helsinki would be rejected by (any) bank (excluding the fact that I could put, if I wanted, lot more than 30%, yours truly as well) because they would not be considered to have sufficient or stable enough income.

The fact you'd be a recent immigrant must make things more difficult, but the categorization between "unrealistic fool" and "a very good long term customer" must still depend mostly on the source and quantity of money you're making.

That is what I wonder is how I would show my income without history in Finland. I work in internet marketing. Really I would just be showing the cash I am bringing into Finland. Starting to think it might be necessary to rent for a while to show some history and then apply with my 30% towards the apartment and 10 or 15% in the bank. My expenses would be just day to day living expenses apart from the apartment. The apartment and the building seem very desirable even apart from a very good location as all the rentals I found in the building are occupied and are taking anywhere from 4500 and more euros per month depending on the size and they were just renovated in 2013.

[betelgeuse]

That is what I wonder is how I would show my income without history in Finland. I work in internet marketing. Really I would just be showing the cash I am bringing into Finland.

By providing similar papers to what Finns provide the bank, for example: account statements, job contracts and taxation decisions. It will be your job to convince them of the cash flow that will pay for the mortgage.

[GermanInHelsinki]

The bank does of course not care much about what you earned elsewhere before.

The bank of course wants to see a contract for a permanent job in Finland, and that the salary you are getting from that is sufficient for the monthly payments.

If you are working freelance, banks are of course unlikely to give you a big mortgage.

[Rip]

I think it it is obvious you need to rent for a while. Your situation would be a rarity. Buying a fairly expensive apartment, not having a steady work contract there but at least having something to make a case that you can pay back the loan. The very least, you'll be negotiating, an not just about the bank margin, and this despite the fact that the deal might look like a low risk one.

all the rentals I found in the building are occupied and are taking anywhere from 4500 and more euros per month

Forenom apparently. They ask high prices and nobody stays with them with their own money for long.

[betelgeuse]

The bank does of course not care much about what you earned elsewhere before.

They will care if not for other reason than that they need to verify the source of the existing funds. I was talking with a real estate agent the other day and he was telling how many deals have gotten cancelled when the origins for the money of Russian buyers could not be verified (so banks refused to relay them to the seller).

The bank of course wants to see a contract for a permanent job in Finland, and that the salary you are getting from that is sufficient for the monthly payments.

If you are working freelance, banks are of course unlikely to give you a big mortgage.

About all freelance (as in the Finnish terminology of multiple employers with one tax card) work can be converted to go through own company. There's no automatic refusal of entrepreneurs. The banks will just review the income statements and balance sheets of the company. My personal experience is that if you have a good counter party at the bank, it's not just filling some forms and looking at what the computer says. The problem for the OP is finding these non drones and not really being that familiar with the Finnish mortgage market.

[alexnicolas]

I think it it is obvious you need to rent for a while. Your situation would be a rarity. Buying a fairly expensive apartment, not having a steady work contract there but at least having something to make a case that you can pay back the loan. The very least, you'll be negotiating, an not just about the bank margin, and this despite the fact that the deal might look like a low risk one.

all the rentals I found in the building are occupied and are taking anywhere from 4500 and more euros per month

Forenom apparently. They ask high prices and nobody stays with them with their own money for long.

That 4500 euros was a monthly rate from Forenom on a year long agreement!

[Rip]

That 4500 euros was a monthly rate from Forenom on a year long agreement!

That is what they say, but they are mostly for the short term market as most people (or companies) would look either something more economical or would want to get considerably more for the money - unless it is short term and therefore more or less an alternative to a hotel.

Shoebox in Helsinki can cost ~650€/month, but if you search what you can get for 3000€/month, I can't understand why I would want the Forenom example, if I had the money or interest to spend it.

My main point was that you should not expect that you could have the place rented out for that kind of price.

[alexnicolas]

That 4500 euros was a monthly rate from Forenom on a year long agreement!

That is what they say, but they are mostly for the short term market as most people (or companies) would look either something more economical or would want to get considerably more for the money - unless it is short term and therefore more or less an alternative to a hotel.

Shoebox in Helsinki can cost ~650€/month, but if you search what you can get for 3000€/month, I can't understand why I would want the Forenom example, if I had the money or interest to spend it.

My main point was that you should not expect that you could have the place rented out for that kind of price.

I guess it does make more sense for at least the short term to get settled into Helsinki to rent, I love the building and location and the new modern apartment that Forenom has at Uudenmaankatu 13. I must not have the best websites to search for a rental that is similar. If I stay anywhere for the short term I want it to be recently renovated in Helsinki center (Kamppi). I seem to be having trouble finding recently renovated modern apartments both rental and for sale.

[Rip]

I seem to be having trouble finding recently renovated modern apartments both rental and for sale.

Number of rentals of the type is rather small as mostly people interested in such a thing would rather buy. Forenom does have the good point that they offer shorter periods, with rentals you'd often need to sign a one year contract.

I don't have experience of the rental market outside smaller ones, so I don't how difficult it would be to one (and should you actually use an agent). It seems you are looking at (parts of) the zipcodes 00100, 00120 and 00180. The largest websites are apart from oikotie vuoraovi.com and jokakoti.fi.

[alexnicolas]

In investment circles an expected rental return might be 4-5%. However, this is Finland, the land where renting an apartment involves expensive maintenance fees. Thus a 100k sale-price yksiö will be rented out at around the 650 - 700e / month mark. I will let you do the maths on how that translates to 300k properties, but as you can see the Forenom quote is not even in the ballpark. Forenom isn't comparable. It is a specific service aimed at business, short-term travellers staying on company money where you pay a premium for cheaply furnished apartments. If you want to know what the rental will be on a 300k property then find comparable properties on the larger rental market in Oikotie. If you want an expensive rental to be furnished, multiply it by 2 and expect that they are very difficult to find, as furnished is very rare here. Limiting your search to inner-city will have the same problem as so much of the real estate is in beautiful buildings which are neither large nor new.

Going by your 650-700 euro per 100k, then the Forenom quote doesn't sound too bad.

The 510,000 euro completely renovated apartment they have rented out for 3711 euros a month and that is furnished with electricity, water, heating, internet actually looks like a decent option to settle into Helsinki and get my bearings. I have noticed finding an old building renovated in central Helsinki with renovated apartments is hard to come by.

[betelgeuse]

Thus a 100k sale-price yksiö will be rented out at around the 650 - 700e / month mark.

Going by your 650-700 euro per 100k, then the Forenom quote doesn't sound too bad.

You misunderstood (no per 100k was said by tummansininen). The price per square meter is highest for the 100k yksiö (= single room) and it goes down the larger the apartment gets. Thus, you can't just multiple the price given by tummansininen.

[betelgeuse]

The bigger the apartment the more cost-effective it is per square metre, but the maintenance charge doesn't always follow suit. It depends on the block. Some companies charge maintenance by the square metre, some by the occupants, some by the market value, some charge a flat fee...

The basis for the maintenance charge is set by the articles of association. The two most common models are per square meter and per share. The number of shares is usually in relation to the number of square meters. The water charge is usually by the number of occupants (or by actual usage in newer buildings). I have am not aware of market value or a flat fee as basis. Using market value in the articles of association would be a source of endless disputes when the housing company and the owner would not agree on the market value.