What are the costs associated with homeownership? When you own a home, you can’t call a landlord when something goes wrong. After all, you are your landlord. There are a ton of benefits to this, but you might be surprised at the costs you are now responsible for if this is your first time owning a home.
First of all, you have your mortgage payment. This includes principal, interest, property taxes, homeowners insurance, and sometimes mortgage insurance. You should verify with your mortgage company that they’re paying your taxes and insurance on your behalf. Generally, they do, but it’s always good to double check.
You will also need to pay your utilities. You might’ve already paid these as a tenant in some situations, so this might not be a shock. You’ll need to pay for water, gas, sewer, electric, cable, your landline (if you still have one), and internet.
You’ll also be responsible for the exterior of the home. That means lawn care, your roof, painting, and siding. If you have a stucco home, you’ll need to make sure it remains in good condition. In Colorado Springs, we get these lovely hailstorms, and after one of those, you’ll probably need to replace your roof.
Don’t forget about your appliances either. This means both your kitchen appliances and items like your water heater and furnace. You’ll want to keep these maintained, but when they go kaput, you’ll have to pay for the replacement.
“When the big-ticket appliances in your home go kaput, you’ll have to pay to replace them.”
You’ll also have to pay for disaster mitigation. If your basement floods or a tree falls on your house, you’ll need to pay for that. Sometimes homeowners insurance will cover these, but it’ll still be your responsibility to work through it all.
If you live in an area with a homeowners association, some of these costs might be rolled into your HOA fee. For example, your homeowners insurance may be included in the fee, or if you live in a townhome community, the exterior costs may be maintained through the HOA.
You can also get a home warranty to help mitigate some of these costs. It will cover a lot of the big-ticket items and appliances that may be hard to replace out of pocket. You might want to buy a good warranty when you buy a home, and some of them will even let you buy it after the fact.
Hopefully, this list gives you a better idea of all the costs associated with owning a home. If you have any questions about this or other real estate topics, feel free to give me a call. I’d love to hear from you.