For most, owning a home is the all-American dream. However, this step into adulthood can be more costly than you think. Before you set up your house-buying meeting with the real estate agent make sure you consider these five homeowner expenses that renters don’t have to pay.
The Taxes on Your Property
The amount you will pay on your property taxes depends on your home along with the location of your home. This number can be pricey but on average people pay between $2,000 and $3,000 a year in property taxes. There are a few ways you can find out how much this will cost you monthly: one is to use an online mortgage calculator and the other is to take the yearly cost and divide it by twelve.
Paying for Homeowner’s Insurance
Whether owning a condo or a home you will need some type of homeowners’ insurance; this price will vary. When owning a condo you will on average pay between $100 and $400 dollars a month. With homeowners’ insurance this expense will depend on the cost it would take to rebuild your home in case of a disaster. On average, you will pay $35 a month for every $100,000 of your home’s value.
Having to Make Repairs
There will be no more late night calls to your landlord to report that there is a leaking pipe in the ceiling. This will now be your problem to fix. Some of the maintenance you will do on your own can cost you a lot. A new water heater on average costs anywhere between $500 and $1500 and has a lifespan of about 10 years. While not all of your repairs will be very costly, they can still add up.
Homeowner’s Association Fees
Depending on where you buy, you may need to pay this extra fee on top of your mortgage to cover the maintenance of the landscape, community pool, and fitness room in your neighborhood. This can be an extra $100-$400 a month.
Other Monthly Costs
As a renter you are most likely used to your rent covering things such as water, sewer, heat and electricity. Once you sign the papers for the new home, you also assumer full responsibility for all of these bills.
When prepared, owning a home can be an enjoyable and satisfying experience. Before making any final decision on purchasing a home make sure you have researched and considered these five homeowner expenses.