Avoid These New Homeowner Mistakes!
Premier Property Solutions’ Tips for New Homeowners
Making the down payment on your first home is just the first expense in a new homeowner’s world. It’s important to realize that there are going to be large monthly and yearly expenses for as long as you own your home.
To help encourage you and plan for the cost of being a new homeowner, below are ten expenses that you should include in your budget:
Mortgage
Your mortgage payment is going to be the largest bill you pay each month, for the next 30 years, so this is one you definitely need to have in your budget.
Property Taxes
Depending on your state, property taxes will vary. Usually, these taxes are paid twice a year, and can actually change year to year.
Homeowner’s Insurance
Homeowner’s insurance is going to cost you between $500 to $1,500 a year (or more – depending on where you live). If you can bundle this insurance with auto or life, your company will usually give you a discounted rate.
Hazard Insurance
Hazard insurance is different than homeowner’s insurance. Hazard insurance helps cover damage from natural disasters, including damage from tornadoes, hurricanes, earthquakes, floods, etc. Check with your insurance company to see what type of natural disaster damage is specifically covered.
HOA Fees
If you are moving into a condo or townhouse, you are mostly likely going to have to pay a monthly or yearly HOA fee. These fees are used to keep up on building repairs and groundskeeping. Some communities may also have a fee to maintain common amenities – swimming pools, club houses, recreation centers, and playgrounds are included in this.
Utilities
Paying utility bills is probably not a new expense for you, especially if you are a renter. Keep in mind that paying for a home is much more expensive than an apartment, and will include fees for trash removal and sewer.
Major Home Repairs & Renovations
Hopefully you had a home inspection completed before buying your home and you know what repairs were recently done or are needed. It’s important that you have money saved up to cover the costs of these repairs. For example, replacing a leaky roof can cost at least $10,000. Aside from fixing major problems, at some point you will probably want to renovate areas of your home, such as the kitchen. These projects can be expensive, so make sure you have saved enough to complete the project.
Regular Home Maintenance
Being a homeowner is exciting, except when it seems you need to replace something every month. Homeowners average spending a couple hundred dollars a month for home repairs, like new faucets or appliances.
Landscaping
Maintaining your outdoor space can be quickly add up, even if you plan on doing most of the work yourself. Also, there are some projects that will require the help of a professional, such as replacing your pool liner or removing dead trees. Have money set aside to cover these repairs as well.
Moving/Furniture
Moving is going to be a one time expense, not a monthly bill; however, most people who buy a home are upgrading to a larger living area. This means that you will most likely require more furniture and decorations to make your house seem like home.