We all know that homeownership comes with many benefits, but many new homeowners are surprised to discover it comes with some unexpected expenses. When renting a home, you make one rent payment and don’t have to worry about paying for anything else. When you’re a homeowner, you pay your mortgage payment but then have to pay other people for house-related expenses as well. All of these expenses can really add up.
To prevent you from any unwanted surprises, we’ve put together a list of some of the most common hidden expenses that new homeowners complain about.
Property taxes. There’s no avoiding them, and they can add a lot of extra money to your monthly payment. Property taxes vary based on where you live and the value of your home. The national average cost of property taxes is 1.07% of the home’s value.
Have you ever thought about how many different mechanical systems you rely on in your home? The hot water heater, stovetop & oven, the fridge and a number of toilets are only a few things in your house that will eventually need to be repaired. Then you have something like your roof or HVAC. These are necessities but replacing them can be extremely costly. Setting aside money each month to make repairs when needed is an excellent idea for a homeowner.
Unless you are incredibly handy and don’t mind spending your free time on maintenance tasks, be prepared to pay between $50-$300 for home services. These can include maintenance services for your yard or pool.
Having a professional do these tasks for you will ensure that your yard is always looking fresh and that your pool remains in good condition to prevent you from major repair expenses down the road.
Another service to budget for is pest control. Keeping spiders, scorpions, mice, and other unwanted pests out of your home is a worthwhile expense, but one that many homeowners do not prepare for.
Another expense you may not have known about is homeowner’s insurance. If you’re getting a mortgage on your home, you will be required to have homeowner’s insurance. But even if you pay cash, you should definitely have homeowner’s insurance. This would cover you in case of fire, vandalism, hail, lightning, and even medical care coverage if someone gets injured on your property.
Is Homeownership Worth It?
Even though the unexpected costs seem like a lot of extra money to spend, homeownership is still worth it. No doubt about it. In most cases, the amount of rent a person pays is still more than a mortgage payment plus taxes and insurance. Plus, with homeownership comes the benefits of building equity which can be used in the future to help you buy another home or to cushion your retirement account. Plus, let’s not forget about the tax incentives that are out there for homeowners. Those will save you a lot of money.
If you’re interested in learning more about homeownership, we are here to help. Let’s connect and discuss your questions and concerns.