Purchasing your first home is an unforgettable experience. There is little that can compare to the sense of reward that comes from closing on your deal and getting the keys to your new home handed to you. Every year, there are approximately 2 million first-time homebuyers. In some instances, their joy quickly turns to frustration because the reality of what it means to maintain the upkeep on a home comes into focus.
The hidden costs of owning a home are multifaceted and often unexpected. The truth is that most of these costs are simply unavoidable. The best thing you can do is educate yourself about them and be prepared. As long as these things don’t take you by surprise, you can manage them with poise. Here, we will highlight the most common hidden costs for homeowners.
Property taxes represent a hidden cost that most homeowners are familiar with. While this cost is not unknown, new homeowners are not aware of how expensive property taxes can be. In most states, the county tax assessor publishes the taxes associated with each home on their website. Consult with your realtor about how much the property taxes for your home will be before you make your purchase.
Home Owners Association Dues
If you live in a subdivision, the Home Owner’s Association (HOA) is an organization that consists of all homeowners in the neighborhood. The HOA is responsible for making sure that all property owners are in compliance with the regulation set forth by the association.
There are monthly dues charged by the HOA to the homeowners, and fees for violations. If there are too many violations, the association can request the removal of the property owner from the subdivision. Your realtor can inform you about the HOA dues in the area of your purchase.
Much of the hidden costs a homeowner will face come in the form of maintenance issues. Home maintenance can take on various forms since there are a host of things that can go wrong with your property. Major repairs can have a significant impact on your budget.
Appliances always seem to breakdown at the absolute inopportune time. To avoid the hit to your pockets, there is a solution. Home warranties can protect your appliances if they malfunction.
If a home isn’t sufficiently insulated, this can result in exorbitant energy costs. Depending on the home you purchase, there may be a need for insulation. Instead of removing the drywall, there are companies that will blow insulation into the wall, and seal the holes. If you have to add insulation to a home retroactively, this can accrue costs that you were not considering at your time of purchase.
If they go unattended, leaky pipes can be a drain on your pocketbook in the long run. To keep from paying excessive water bills, all leaky pipes and faucets must be repaired. It is typical for homebuyers to overlook leaky pipes during the process of evaluating the home; this is something that often comes to their attention after they move in.
The cost of pipe replacement can be avoided by having a home inspection and identifying the problem early. If you catch the problem early, you can add a contingency to the purchase contract to have the pipes fixed by the seller prior to the closing.
While it is clear that utilities must be paid in every home, the actual cost incurred in connection to these necessities monthly is often a shock to new homeowners. If a homeowner is going from an apartment to a home, the cost of utilities can be unexpected.
If you want to move into your new home without being taken off guard by the cost of your gas and electric, ask the seller to show you copies of there utility bills for the winter and summer months. This will give you an indication of how high your bills will be.
The heating and cooling system in your home has to be in working condition to provide the comfort that you require as a homeowner. The HVAC unit is at the heart of your home’s heating and cooling system. As a hidden cost, the malfunction of your HVAC unit can be a real headache.
As a new homeowner, you are obligated to take care of your homestead. The many unforeseen expenses related to owning a home can be quite daunting when you are first getting started; mitigate your frustration by being informed and prepared.