Costs of Homeownership
- Property Taxes average about 1% of the value of the home, although this can vary from city to city and state to state. These taxes can either be included in your monthly mortgage payment or will be billed to you annually. Your realtor and your lender should go over these with you so this is not a surprise.
- Homeowner’s Insurance rates can vary depending on many factors such as size of the home and its age. Rates in general average about $35 per month/ $100,000 home value. Some lenders require certain amounts of coverage and may require flood insurance in certain areas. You will need to contact a few companies and compare rates and coverages to find a policy that suits your needs.
- Inspection and Appraisal fees will need to be paid either at the time of service or through closing. An inspection of the home is one of the wisest choices before you complete your purchase. They can cost about $500 and up depending on the home and what is included in your inspection. Appraisals can cost about $300 and up and payment may be required earlier than closing.
- Preventative Maintenance and Repairs can be needed without warning from time to time. It is good to set aside about 1% of the value of the home per year for maintenance and/or a repair.
- Closing Costs can vary depending on the loan program you have chosen. These can also vary from about 15% of the value of the home. These usually include attorney fees, loan application fees, appraisal fees, recording fees and title insurance. The Lender and Your agent will go over these costs so you understand all fees associated with the loan and purchase.
- Mortgage Insurance is an additional insurance that lenders may require when borrowers have less than a 20% down payment. If required the payments will be added to your monthly loan payments.
- Homeowner Association Fees are required in some neighborhoods and condominiums. These fees are to cover the costs of maintaining the common areas. Fees can be higher in neighborhoods with more amenities, such as pools and tennis courts. Your Realtor should know what the fees will be for each home you tour.
- Home Warranty Coverage can protect the buyer from expensive repairs or replacement when home is not brand new. These warranties average from $300-500/year for basic coverage and $100-$300 more for additional coverage. It is also good to ask your seller to purchase one for you in your offer to purchase if they have not offered such in the listing.
- Lawn Care costs can be overlooked when buying a home for the first time. You may choose to purchase equipment to maintain your own lawn or hire landscaping services. Lawn service can vary from $3050 per cut and more depending on size of lot and contract with service company. Mowers can be anywhere from $100 used to hundreds for new.
- Moving Costs if you need can typically run about $1200 for an in state move and about $5500 or more for a long distance move.