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The cost of owning a home is much more than just your mortgage. There is a sizable list of additional costs prospective homeowners should plan for when thinking about buying a home. Here we will go over the primary additional costs of home ownership you might not have thought of.
Property taxes are common enough in real estate conversation that you probably expect them. However, what you might not expect is just how much of an expense they can be. Property taxes differ from one area to the next but average out at around 1.1% of your home’s assessed value. While it doesn’t sound like much, property taxes can cost you up to $1000 per month in some states and municipalities.
Homeowners’ insurance is another expense you were likely prepared to deal with. However, because homeowners’ insurance does not cover absolutely everything, you might get stuck dealing with costly incidents on your own financial terms. Natural disasters like floods, earthquakes and hurricanes usually require separate insurance policies and can vary in cost depending on where you live.
Issues with a home’s electrical wiring can come with both risk to your safety and your wallet. Electrical shorts are a common cause of fire that can damage or destroy your home depending on the severity. Even poorly installed outlets or switches can pose potential harm or be expensive to fix. You will need to hire licensed electricians to repair or inspect for problems with your electrical system to make sure everything works properly and up to local codes and safety standards.
Plumbing problems like clogged toilets or shower drains are fairly common household issues that you can usually handle on your own. A little basic plumbing knowledge and the right tools will help you fix the smaller problems, but sometimes your plumbing can work against you behind the scenes. If you have an older home, the pipes might have mineral buildup which can affect your water pressure, allow clogs more easily and in the worst cases weaken the pipes to the point of leakage. Pipes have to be replaced by a licensed plumber which can add up quickly—regardless of any potential water damage that may occur.
Termites can cause extremely expensive damage to your home. Termite damage, whether existing or ongoing, affects the structural integrity of your home and can lead to safety issues. Specialized termite damage inspectors can help you identify any risks or existing damage so you can avoid the much more expensive task of cleaning up the mess later.
For many, one joy of homeownership is having their own outdoor spaces. Unfortunately, the upkeep of your outdoor spaces can be more costly than many homeowners expect. Landscaping projects come with the obvious upfront costs of labor and materials, but there is also an ongoing cost to make sure everything stays alive and beautiful. There can also be unexpected landscaping expenses, like damage from roots or cleaning up fallen trees.
Many of these costs are potential rather than guaranteed. However, the more prepared you are for an expense, the easier it will be to handle the issue when the time comes. Keep these costs in mind when determining the cost of buying your own home.