Unrealized Cost of Home Ownership, First Time Home Buyers Should Be Aware Of

Home ownership is a wonderful thing and after all home ownership is the American dream. However the true cost of home ownership is much higher than first time home buyers typical think and they end up being very surprised 99 out of 100 times. For this reason I have laid out the facts about what the extra costs of home ownership are so when you due plunge into the real estate market you are truly prepared.

• First and foremost your utilities bills are typical much higher than where you are currently living. For example as a home owner you now have water bills which can be very expensive in some communities. Your electric bill will be higher since in an apartment there are owner meters but now you’re the owner and responsible for all electricity on the property. Typical renters who become buyers don’t really take into consideration that their utilities will basically double since homes are typically larger then apartments and the added utilities they haven’t paid before. If you are paying $300 per month now I would assume at least 50% higher utility bills so $450 However a far better guess would be $600 per month.
• Taxes and insurance bills increase constantly just about every year. So when you actually figure out your principal, interest, taxes, and insurance keep in mind the taxes and insurance will increase, and recently insurance costs have skyrocketed with no stop in site. Also in today’s economic marketplace where towns and cities are hurting financially who do you think they charge first? You guessed it the home owners in the town or cities.
• In most cases you have to pay PMI or private mortgage insurance when you don’t put down 20% on a property. These rates are going up all the time also.
• When owning a home maintenance and repairs are unavoidable even on new construction homes. First time home buyers always underestimate or don’t take into consideration this expense. I have owned houses that have cost me about $1,000 per month in repairs or maintenance and some that are maybe $150 per month depending on condition and maintenance required but I guarantee it won’t be anywhere near $0 per month. So please keep that in mind. However you must also be prepared if a major item like a heater, water heater or roof went this can be very detremental to your wallet.
• Misc fees occur like trash in some towns, permits (fire, home-improvement, party, etc.), snow plowing, vandalism, and on and on. All these things add up that renters typically haven’t experienced before.

Don’t be deterred, home ownership has many benefits just want first time home buyers to be fully aware that when you buy a home not all the costs are typically apparent if you have never been down that road before.

Chuck Barnes owner of http://lifeguardrealtyinc.com Since hiring a buyer’s agent is so important I would like to help you find one. If you are in Eastern Mass you can contact be directly at chuck.barnes@lifeguardrealtyinc.com. If you are located anywhere else in the United States contact me at http://lifeguardrealtyinc.com/buyersagent