The Hidden Costs of Owning a Home

By
Real Estate Agent with Long and Foster Webber and Associates,480 W Jubal Early Dr #100, Winchester, VA 22601

The Hidden Costs of Homeownership

If you've never owned your own property before, there are some costs you should prepare yourself for ahead of time. Should you take out a mortgage, you'll have your monthly mortgage payment, but often there are additional costs and fees added that a new homeowner will not expect. Listed below are items you should expect to pay once you become a homeowner.

Property Taxes

When you rent, you are not responsible for the property taxes on the property. But when you become a homeowner, you're expected to pay yearly property taxes, of which go to public works, wages for government workers or public school boards. Based on the current value of your home, property taxes are assessed every year and will likely change to reflect an increase (or decrease) in your home's value. Property taxes can be paid at one time, or they can be divided into 12 payments over the course of a year and added to your mortgage payment. When you're trying to determine what your mortgage payment will be each month, don't forget to factor in property taxes.

Home Maintenance

When you live in a rental property, most maintenance is performed by the landlord or a property manager. When you become a homeowner, those maintenance costs fall upon you. When you purchase a home, all maintenance items should be considered when it comes to your overall budget. Will you want to replace all the appliances? Will the property need new windows or a new roof? Does the home need basic upgrades? Most people in the industry suggest you allocate 1% of your home's worth for maintenance costs every year, but the reality is that 1% is likely the minimum – you should plan on more than 1% maintenance costs each year as a homeowner, and if you plan on any larger renovations, bet on the costs to be even higher.

Mortgage Insurance

Most people, when they buy a home or property, are able to do so by taking out a mortgage loan. If you put less than 20% of the cost of your property down, you're required to have Private Mortgage Insurance (PMI). PMI protects lenders if the borrower defaults on their loan. PMI is charged annually, and it will typically cost 0.5% to 1% of the entire loan amount. The payments are generally paid each month rather than in a large one-time payment. If you plan on taking out a mortgage loan, and you don't have 20% to put down, expect to add private mortgage insurance payments to your other monthly bills.

Supplemental Insurance

Do you live in an area prone to natural disaster? As a homeowner you'll need to have regular home insurance to protect your home or property from typical things (plumbing issues, roof leaks, etc.) that homeowners encounter. Should you live in an area that's prone to weather-related issues (floods, tornadoes, earthquakes, hurricanes) you will want to purchase supplemental insurance to make sure your home is covered should nature decide to show herself.

Landscaping and Lawn Care

When you rent a condo or an apartment, it's highly likely you are not spending a lot of time outside in a yard. When you buy your own property (should it have a yard or some kind of outdoor area), expect some hidden costs to come in the form of lawn care. Does the yard need some major landscaping? Are you going to mow it yourself, or will you hire a company to do it? Do you have a lawn mower, rakes, snow or leaf blower, yard tools, shed, and any other items needed to keep your yard looking great year-round? A yard comes with extra costs, so be sure to know how much you want to spend on upkeep per year.

HOA Fees

If you've been renting your previous residence, it's likely you haven't had to pay Homeowners Association (HOA) fees for your apartment or rental. Should you buy a house, condo or townhouse in a neighborhood with common areas, a clubhouse, pool, or any other kind of community meeting places, it's likely you'll move into a neighborhood with an HOA. HOA fees can vary in terms of what the HOA covers within the community, but unless you know through your Realtor or through the homeowner the monthly fee, you can expect to spend anywhere from $10 to hundreds of dollars per month on HOA fees.

Buying your first home in #WinchesterVA or property is a huge step in anyone's life. Before you start your property search, make sure you consider all of the items above when you're thinking of buying a home or property and during your property search.

 

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Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. Jan Sohlman 10/05/2015 03:00 AM
Topic:
Home Buying
Location:
Virginia Frederick County Stephenson
Tags:
home maintenance
buying a home
property taxes
buying a house
mortgage
winchester homes for sale

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Rainer
548,791
Jan Sohlman
RE/MAX Integrity - Eugene, OR
RE/MAX Integrity

Great blog Beth,

Do you mind if I reblog it? It hits many great points.  All the best to you. Jan

Oct 01, 2015 03:52 AM #1
Rainer
16,261
Chip Morgan
Long Realty - Dove Mountain, Marana AZ - Tucson, AZ
LSS, LSE, LMS

This is incredible information for the "other side" of home ownership.  I am going to print this and add it to my information that I give to renters whn they are trying to make  decision if home ownership is right for them!  I know we always try to justify why ownership is the best thing in the world, but there is another side to the coin.

Oct 01, 2015 03:53 AM #2
Rainmaker
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Stefan Winter
Real Estate in IL & NV | Owner of Real Estate Web Tech | Daily Vlogger - Las Vegas, NV
Owner - Winter Group & Real Estate Web Tech

All fee's that certainly have to get paid, if bought at the right market and taken care off hopefully the value rose more then costs. Have a great week!

Oct 01, 2015 06:26 AM #3
Rainmaker
798,769
Troy Erickson AZ Realtor (602) 295-6807
Good Company Real Estate www.ChandlerRealEstate.weebly.com - Chandler, AZ
Your Chandler, Ahwatukee, and East Valley Realtor

Beth - Anyone considering purchasing a home needs to know that there are additional costs, other than the mortgage, that come along with owning a home. It's much better to know this and be prepared for this ahead of time, than realizing it after the fact.

Oct 01, 2015 08:27 AM #4
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Rainmaker
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Beth Paisley Realtor with Long and Foster Webber

Winchester Virginia 540-327-2813
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