Top 3 Hidden Costs of a Homeowner
It’s always exciting when you buy a new home; you’ve been through months and months of planning and searching for the perfect place, and now that you have your heart set on one, the next big, nerve-racking step is making an offer. Once you’re willing to dole out that kind of money, you want to know what you’re getting into, right? There are a lot of things overlooked by first-time home buyers that go unnoticed to the eye. Whether it’s something you forgot or simply inexperience, continue reading below to find out which costs homeowners incur the most often.
1. HOA Fees
Ever wonder how a neighborhood or complex has such great amenities or how all the residences look so symmetrical and well-kept? You have HOAs to thank for that! HOAs, or homeowners association fees, usually come in the form of monthly or annual payments that each resident makes in order for upkeep and amenities to happen. Depending on how strict maintaining a certain look to your home is or the extent of the amenities offered, HOA fees can vary tremendously. Be sure to look into HOA fees in the neighborhood you’re eyeing and whether or not it will be fluctuating in the coming years from new improvements.
2. In-home Repairs
Whether fresh new appliances come with your new home, or you have to budget for new ones, one thing’s for sure: things inevitably break. In a NerdWallet article, financial planner Matt Becker shared this- “While every situation is different, the typical rule of thumb is to expect to spend an average of 1% to 2% of the value of your home on repairs each year.” While yes, most new or recently improved systems in a home will last for an average of ten years, one can never be too sure, and it’s better to budget at the start then wait for a mishap down the road. Make sure to find out the year built, installed, or refurbished of every appliance and system in your home, and use this handy infographic to learn the average lifespan of each.
3. Energy & Insurance
Another price tag that (unfortunately) doesn’t come with your brand new home’s asking price is utility bills and homeowners insurance. According to Zillow, the average American homeowner pays around $3,000 a year in utility bills and almost $1,000 a year in insurance costs. While we do suffer from the occasional hurricane, Florida is on the lower end of the spectrum in average energy costs at $292, being substantially lower than other states that suffer from earthquakes and heavy winters (WalletHub). Don’t let these varying costs catch you by surprise! Research is your best tool in uncovering how much this hidden price tag will cost you.
We here at Collins & Company Inc. know the ins and outs of homeownership like the back of our hand. Don’t hesitate to call us with questions or concerns regarding costs like these!