Home Owning Costs You Need to Prepare For

Although owning a home is notably more expensive than renting because of the cost of buying it, it does have other expenses many don’t consider.  Not only does this mean that many new homeowners get blindsided by these costs, but even some who have owned their home for a few years may miss things like emergency spending.

Property Taxes

Property taxes are something that every homeowner dreads having to pay.  The good thing about these taxes is they help you figure out how much your house is worth. Unfortunately, it comes at a literal cost.  The average property tax cost in America for a home is between two and three thousand dollars.  If a homeowner is living month to month on their bills and expenses, this large amount could pull them under.

HOA Fees

Living in an apartment means that you’re lucky enough to avoid a homeowners’ association fee.  These associations are neighborhood groups that work together to help raise the value of your property.  Unfortunately, these can cost from fifty dollars to five hundred dollars a month, depending on the area you live.  When looking at homes, make sure to ask about HOA fees so you can add that to your house payment calculator.

Higher Electricity Bills

A larger property than an apartment means larger energy bills.  Your heating, electricity, water, garbage, and anything else that might have a monthly account will go straight to you.  This type of cost can make first-time homeowners feel like they’re getting swallowed by bills.  It’s essential to plan for how you’ll pay these bills and what you can afford.

Special Insurance

Unfortunately, some areas need specific insurance for homeowners to be allowed to live there.  In areas close to water, flood insurance is a must and can cost up to five hundred dollars a month.  Other regions have things like natural disaster insurance, earthquake insurance, and different kinds that also tack on more money every month.  There’s no way to avoid these costs except choosing somewhere else to live, so it’s important to know that they’re there in the first place.

Interest On Your Loan

No loan is completely free.  Lenders, whether they’re companies or individuals, will expect some payment in return.  Interest rates vary from state to state, and lender to lender, so do your research before accepting a loan.  You may feel excited and ready for anything when you’re buying a home, and you should be!  Still, if that excitement makes you miss some vital paperwork, you could be out a lot of money.

Emergency Spending

In a rental, most of your emergencies are covered by your leasing company or landlord.  Unfortunately, as a homeowner, the cost comes down on your head instead.  If your water heater breaks, it could cost up to two thousand dollars to replace.  Broken windows can cost you, so can an oven that doesn’t stay hot or a fridge that doesn’t stay cold.  It can’t be stressed enough how important it is that you have a savings account with at least a couple thousand dollars in it for home repairs if anything should happen.