Home Ownership Costs That Are Often Overlooked
How much it costs to own a home depends on the home you own. Most people make monthly mortgage payments that includes taxes and homeowners insurance, and sometimes, mortgage insurance. It costs money to pay for electricity, heating, and water, and homeowners have to be prepared for unexpected expenses such as replacing a roof. If your home sits on a large property, yard care may be an expense, and if you live in a condominium or gated community, you will likely have HOA fees as well."}},"@type": "Question","name": "What Are the Benefits of Owning a Home?","acceptedAnswer": "@type": "Answer","text": "There are many benefits of homeownership. It can be financially beneficial because every mortgage payment helps you earn equity. Some mortgage payments may be lower than rent payments over time so that you may earn money in the long run. Homeownership may offer tax benefits, as well, and it can help you build your credit.","@type": "Question","name": "How Much Should I Save for Home Repairs?","acceptedAnswer": "@type": "Answer","text": "Some financial experts suggest budgeting for 1% or 2% of your mortgage balance as a yearly maintenance and repair fund, but the amount you should save depends on your home's age, condition, and size.","@type": "Question","name": "What Monthly Costs Are Included In Home Ownership?","acceptedAnswer": "@type": "Answer","text": "Most homeowners pay a monthly mortgage. Other potential monthly costs include taxes, homeowners insurance, private mortgage insurance (if you have an FHA mortgage), and HOA fees, if applicable. You will also likely pay monthly heating and cooling, electricity, and water. If you have taken out a home equity loan or a home equity line of credit, you may pay those each month as well."]}]}] Investing Stocks Bonds Fixed Income Mutual Funds ETFs Options 401(k) Roth IRA Fundamental Analysis Technical Analysis Markets View All Simulator Login / Portfolio Trade Research My Games Leaderboard Economy Government Policy Monetary Policy Fiscal Policy View All Personal Finance Financial Literacy Retirement Budgeting Saving Taxes Home Ownership View All News Markets Companies Earnings Economy Crypto Personal Finance Government View All Reviews Best Online Brokers Best Life Insurance Companies Best CD Rates Best Savings Accounts Best Personal Loans Best Credit Repair Companies Best Mortgage Rates Best Auto Loan Rates Best Credit Cards View All Academy Investing for Beginners Trading for Beginners Become a Day Trader Technical Analysis All Investing Courses All Trading Courses View All TradeSearchSearchPlease fill out this field.SearchSearchPlease fill out this field.InvestingInvesting Stocks Bonds Fixed Income Mutual Funds ETFs Options 401(k) Roth IRA Fundamental Analysis Technical Analysis Markets View All SimulatorSimulator Login / Portfolio Trade Research My Games Leaderboard EconomyEconomy Government Policy Monetary Policy Fiscal Policy View All Personal FinancePersonal Finance Financial Literacy Retirement Budgeting Saving Taxes Home Ownership View All NewsNews Markets Companies Earnings Economy Crypto Personal Finance Government View All ReviewsReviews Best Online Brokers Best Life Insurance Companies Best CD Rates Best Savings Accounts Best Personal Loans Best Credit Repair Companies Best Mortgage Rates Best Auto Loan Rates Best Credit Cards View All AcademyAcademy Investing for Beginners Trading for Beginners Become a Day Trader Technical Analysis All Investing Courses All Trading Courses View All Financial Terms Newsletter About Us Follow Us Facebook Instagram LinkedIn TikTok Twitter YouTube Table of ContentsExpandTable of ContentsProperty TaxesHOA and Condo FeesHomeowners InsuranceThe RoofThe HVAC SystemThe Electrical SystemPlumbingTermitesMoldLandscaping and Lawn CareHomeownership Costs FAQsThe Bottom LineHome InsuranceHome OwnershipThe Hidden Costs of Owning a HomeThough the perks are many, watch out for these extra expenses
Home Ownership Costs That Are Often Overlooked
How much it costs to own a home depends on the home you own. Most people make monthly mortgage payments that includes taxes and homeowners insurance, and sometimes, mortgage insurance. It costs money to pay for electricity, heating, and water, and homeowners have to be prepared for unexpected expenses such as replacing a roof. If your home sits on a large property, yard care may be an expense, and if you live in a condominium or gated community, you will likely have HOA fees as well.
There are many benefits of homeownership. It can be financially beneficial because every mortgage payment helps you earn equity. Some mortgage payments may be lower than rent payments over time so that you may earn money in the long run. Homeownership may offer tax benefits, as well, and it can help you build your credit.
Most homeowners pay a monthly mortgage. Other potential monthly costs include taxes, homeowners insurance, private mortgage insurance (if you have an FHA mortgage), and HOA fees, if applicable. You will also likely pay monthly heating and cooling, electricity, and water. If you have taken out a home equity loan or a home equity line of credit, you may pay those each month as well.
SEATTLE and SAN FRANCISCO, July 31, 2017 /PRNewswire/ -- Nationally, U.S. homeowners can expect to spend $9,080 a year on average in hidden costs related to owning and maintaining a home, according to a new analysis from Zillow and Thumbtacki. Since nearly half (47 percent) of home shoppers today are first-time buyers, many of these extra costs may come as a surpriseii.
To help with budgeting, Zillow and Thumbtack identified several common but often overlooked home expenses and calculated what homeowners could expect to pay for them around the country. The analysis also included utility cost estimates from UtilityScore.
Nationally, homeowners pay an average $6,059 per year in to cover homeowners insurance, property taxes and utilities, three common, but sometimes overlooked home expenses. San Francisco homeowners pay the most of the metros analyzed ($13,019 a year), primarily due to the market's high home values and property taxes. Indianapolis homeowners pay the least at $4,699.
Most U.S. homeowners (96 percent) have made some kind of improvement to their homeiii. While many complete these projects themselves, those who hire a professional can expect to spend more than $3,021 a year on average for carpet cleaning, yard work, gutter cleaning, HVAC maintenance, house cleaning and pressure washing, the six most common hired home projects requested by homeowners on Thumbtack. Labor costs can vary significantly by region, with Seattle homeowners paying as much as $4,052 a year on average for those six projects, whereas in San Antonio they pay just $1,962 on average.
"Determining how much a home will ultimately cost you each year and what you can afford is one of the most challenging aspects of home buying, especially for first-time buyers," says Svenja Gudell, Zillow's Chief Economist. "Before starting a home search, take a good look at your finances to determine a monthly payment range you can comfortably afford. While that big back yard or larger home may be appealing, it is important to consider how much maintaining those spaces could cost you."
"While it may be tempting for homeowners to think they can cut costs by doing home maintenance projects themselves, hiring a trained professional to take them on can save them time, anxiety and most likely money in the long run," said Lucas Puente, Thumbtack's Economist. "Across the U.S., buyers should be prepared to spend at least a few thousand a year in home maintenance costs."
To help buyers better understand the total cost of homeownership, Zillow Group, Inc. launched RealEstate.com, a website that allows people to search for homes by the "All-In Monthly Price" of owning that home, like utilities, taxes, HOA's and closing costs. With more than a third of buyers going over budget, knowing all the extra or hidden costs associated with homeownership can help buyers set more realistic budgetiv.
i Zillow and Thumbtack's Hidden Costs Homeownership report factored in three common, but sometimes overlooked monthly expenses (property taxes, homeowners insurance and utilities from Utility Score) as well as six basic home prep costs from Thumbtack. Thumbtack looked at tens of thousands of quotes from small business professionals around the country and determined the average cost for each expense within the selected metros. For the purposes of this analysis, carpet cleaning, yard work, gutter cleaning, HVAC maintenance, house cleaning and pressure washing were identified as six of the most popular home maintenance-related projects. ii According to the 2016 Zillow Group Report on Consumer Housing Trends. iii According to the 2016 Zillow Group Report on Consumer Housing Trends. iv According to the 2016 Zillow Group Report on Consumer Housing Trends.
You should consider moving costs when deciding whether to buy a home. An average local move with professional movers will cost $800-$2500, while long-distance moves cost from $2200-$5700. However, this cost can vary widely based on the distance and how many belongings you have to move. 041b061a72