They bought their home in March 2022. Why this Ontario couple calls the purchase a nightmare

Fernanda Santos and Gustavo Pereira of London, Ont., knew the housing market was wildly overpriced in March 2022, but felt pressured to become owners, so they bought a three-bedroom home in the east end for $730,000.

"Everybody said to us you should buy as soon as you can — doesn't matter if you like it or not, just buy and get into the market," Santos, 34, recalled in an interview with Rebecca Zandbergen, host of CBC Radio's London Morning.

The couple moved to Canada from Brazil in 2019 for a better life. Today, they're sitting on a mortgage with a variable rate (currently at 5.6 per cent) on a house that has fallen in value by an estimated $150,000, and paying $4,400 a month — $1,600 more than they had anticipated.

"That's not what we dreamed about," said Santos. "It's just been a nightmare for us." 

In an attempt to tackle inflation, the Bank of Canada has raised interest rates eight times since the start of 2022. The central bank's rate is now at 4.5 per cent. 

As well, housing prices have dropped considerably since the couple bought their home. In fact, sales in January were the lowest for that month since 2009, down 37.1 per cent compared with a year ago, the Canadian Real Estate Association (CREA) said this week.

How the books of Fernanda Santos and Gustavo Pereira look each month:

"They're just going to raise the rates until they reach a point that they are comfortable with," said Santos. "But they don't think about all the people that they are impacting with that."

Despite both having good jobs, with a combined annual salary of $140,000, Santos and Pereira are struggling to keep up. Both worked as engineers in Brazil. Santos is now a senior estimator with a construction company in London and Pereira is an engineer in training.

"It's not only the mortgage," said Santos. "We have property taxes. It's a huge chunk every single month. We have insurance for the house, insurance for ourselves. So there is a lot of hidden costs."

The couple are also paying $500 a month towards the cost of home renovations.

On the weekends, the couple's work isn't done. Both drive for UberEats and Instacart in an effort to offset their bills.

"When you have like 60 per cent of your full income going toward your mortgage, you pretty much don't have anything left, plus we have to eat, right?" said Santos.

Santos and Pereira are also using their savings — money they diligently set aside for a rainy day — to buy their groceries.