Do you think that only you have to consider the mortgage payments when you buy a home? You might be calculating the cost of mortgage payment and including it into your budget plan and counting how many years are left to own the full equity in the property. Or, you may also looking for options to lower your mortgage payment or to pay it off fast. But, when you own a home, there are other costs to consider some of which you have to bear lifelong since they’re unavoidable.
These costs are discussed in the following lines:
Paying the property tax
You have to pay a local property tax to the government. This money is used to develop schools, sidewalks, parks and for public expenses. If you want to get an idea regarding the current annual tax on your property, you can ask the seller’s real estate agent. However, even if you have to pay the property tax, you can deduct the amount from your income tax.
Buying a homeowners insurance policy
You should also purchase a homeowners insurance policy, the monthly payment of which is usually included in your monthly mortgage payment. How much you have to pay will usually depend on the market value of your house along with the deductible amount and the type of coverage you’re opting for. However, you can reduce the price by installing certain safety features like security systems, deadbolt locks, etc. in your home.
Repair and maintenance work
You will have to include the cost of repair work and maintenance in your annual budget. This is because, you’ll have to do certain basic maintenance work. However, if you’re buying a home from a seller, make sure you hire a qualified home inspector, who can suggest the required maintenance work. The idea will help you negotiate the price of the property.
Replacement of certain structures and items
You will have to replace certain structures and items from time to time. For example, you’ll have to replace the roof of your house usually after every 15-30 years. I know it’s a long time; but a roof replacement might cost several thousand dollars, every time. And, you’ll have to shell out more if you replace it after a long time. Similarly, exterior door may also need to be replaced after about 15 years. You need to replace the main exterior door frequently if you experience extreme weather conditions.
Monthly utility expenses
Apart from considering the cost of electricity, water and internet, you may also have to keep an amount for sewer and garbage service and recycling. So, if you’re buying a home, then ask the seller to provide you the record of utility bills for past 1 year. Doing so, you’ll get an idea regarding the monthly utility expenses in that area.
Tree removal and yard maintenance
Apart from the things discussed above, there are some things which buyers often overlook while calculating the real cost of owning a home. One of these overlooked cost is tree removal. You may not find out while buying a house, whether you buy a new home or from a seller. After sometime, you may notice that you need to cut some trees, for which you’ll have to hire a professional, because it might not be possible for you to cut large trees.
Expenses related to changing decor
Yes, this is perhaps an expense which you may have to bear frequently. It’s quite obvious that you won’t like the same decor for a long time. And, a minimal project will cost you a significant amount. However, you can choose DIY option to reduce the cost of any project.
In short, I want to say that when you analyze your finances to buy a home, also consider these expenses and some miscellaneous ones. This will help you take out a mortgage loan, which you can manage comfortably. Otherwise, you may fall into debt problems when these real costs will creep in.
So, be a smart homeowner and be ready to shell out extra money to make your living a comfortable one, and to turn your house into a sweet home.