Well, making the transition from rented home to being a homeowner is nothing short of a dream come true.
However, when you are planning to buy a home, you need to plan for a number of things rather than just the cost of house or the monthly mortgage payment.
You have to deal with basic upkeep and property tax.
Moreover, you also need to remain prepared for unexpected expenses in the form of surprise assessment and emergency maintenance.
Let us take a look at the different types of hidden costs you might incur following home ownership.
All homeowners must pay this tax.
Property tax is not determined by your bank. On the contrary, it is determined by the city or the township you are located in.
Though you do not have much say in determining this amount, there are a few strategies that can help you to bring it down substantially.
Homeowners insurance helps to protect your investment in home.
This insurance protects your home against loss or damage.
Your monthly premium will depend on the loan granted for your house.
If you have purchased your home through financing, your bank will need this insurance.
Well, what we should spend and what we end up spending varies.
It changes from one person to another.
While some shells out a lot of money for world class remodelling, others neglect basic maintenance and repair jobs.
You certainly do not require world class remodelling, but if you avoid basic repairs, you may end up spending more, later.
Let us find out what exactly determines the cost:
- Condition of the house during purchase
- Quality of materials used for remodelling or building
- Willingness, and of course, the ability to handle a few things yourself
- Climatic conditions in your location
If you want a rough estimate of the cost, you can get in touch with a home inspector.
A bargain house usually turns into a money pit. So, it is always advisable to opt for the better maintained houses.
Few new homes need little to no work.
You will need some redecoration and building works.
You can do the redecoration yourself to cut down cost, but even then you tend to end up investing a lot.
All of us love to decorate our space? Don’t we?
No doubt, the amount of money spent here will depend on the amount of work done.
You may need to buy some furniture too. You can cut down the cost by opting for second hand furniture.
If you plan to move in a few things from your rented apartment and have a few energetic friends, you are good to go!
Have a lot of things?
Once again, you end up spending money by hiring the professional packers and movers.
After you are done handling all costs of home ownership, create a budget. This will help you have an estimate and plan the additional but necessary costs, like painting the exterior of home, caring for your lawn, clearing rain gutters or replacing the floor, accordingly.