Hidden Costs of Home Ownership
It’s the American dream – home ownership. And while there are many financial, emotional and personal benefits to owning a home, there are some hidden costs that are not frequently discussed.
In addition to the mortgage, insurance, and property tax costs that are estimated before closing, there are so many other undisclosed amounts of owning a home. Some of those include:
- Window Coverings
- Lawn Maintenance and Pest Control
General home maintenance expenditures are generally between 1 to 4 percent of a home’s value annually, according to U.S. News & World Report and various other sources. Older homes will be on the higher range of that estimate, due to aging roofs, windows, HVAC systems, and appliances which need to be periodically replaced.
The cost of maintaining a newer home may be closer to 1 percent of the value, but there are other amounts associated with buying a new home. Window coverings are typically absent on original construction, and the expense of plantation shutters, blinds, shades or drapes can be pricy for the entire home. To offset the investment of new window treatments and interior shutters, shop online for the best deals. Internet retailers save you the cost of scheduling a consultation with a salesperson and coordinating a separate appointment for installation. While some new homes have a landscaping allowance, it is rarely enough to landscape the whole property, leading to another substantial expense. New furniture, rugs, towels, light fixtures and other items to fill a new space can also prove costly.
When purchasing an older home, the main structure is often more fully complete, with windows covered, yards landscaped, and some appliances in place. However, sometimes those items are out-of-date or in a different style than desired. Consider the replacement costs of interior shutters or blinds, carpeting, painting rooms, removing wallpaper, even remodeling kitchens and bathrooms when evaluating an older property for purchase. Such expenses are above and beyond the estimated 1-4% maintenance costs estimated by experts.
If you purchase home well within your budget, and estimate generously for maintenance costs, the hidden costs of home ownership should not cause added stress to a budget.
By Brian Wright