There are three core investments a person must have in their lives: A good and loving partner, a job you love, and a home you can call your own. Striving to provide yourself a home is a basic need for every human beings, and for most American households do own their homes.
More people today are choosing renting over buying, and the home ownership rate in the United States has actually fallen "to the lowest in more than 19 years," according to Bloomberg.
Truth be told, owning a home is more costly have you think - one of its many reasons is that millennials are more reluctant on the homeowner path. So before you contact a real estant agent, you should know these five costs homeowners pay that renters don't, that will question whether you're really ready for owning a home according to Zillow:
1. Property taxes
According to statistics, Americans have spent an average of $2,132 last 2013 on property taxes on their homes. But you can actually estimate your property taxes in advance by dividing the amount by 12 and adding it to your monthly payment. You will find this in the MLS information. Other than that, a mortgage calculator can also help you estimate your property tax costs.
2. Homeowners insurance
Homeowner's insurance costs an average of $35 monthly for every $100,000 of your home's value. Or if you intend to purchase a condo, you'll need a condo insurance policy. It is separate from traditional homeowner's insurance, which costs an average of $100 to $400 anually.
3. Maintenance repairs
Did you know the remodeled home of your dreams may pass your home inspection triumphantly, but that doesn't mean those renovations will last a lifetime. Conventional water heaters last about a decade, with a new one costing you between $500 to $1,500 on average. Air conditioning units don't typically last much longer than 15 years, and an asphalt shingle roof won't serve you too well with no less than 20 years.
Don't forget about those little repairs where you won't be calling your landlord. It can be about a fridge water filter light, a tear in your window screen, a toilet problem, or even those burned out light bulbs.
Owning your own dream house means planning beyond the down payment and your annual maintenance expenses. U.S. News & World Report advises planning on spending "between 1 to 4 percent of a home's value annually on maintenance and repairs." And logically, the amount increases as your home ages.
4. HOA fees
Yes those mortgage fees are affordable, but take into account the homeowners' association (HOA) fees. HOA fees cost anywhere from an average of $200 to $400 per month and payments for your personal leisure like fitness center, neighborhood landscaping, community pool, and other common areas.
5. Utilities
When you're rentig, you don't have to worry too much about some costs for your apartment because you have your landlord to worry that for you. But when you own a house of your own, you're in charge of water, electric, gas, Internet, and cable expenses.
Numbers wise, the casts of your utilities have a big chunk of difference from renting to actually owning your own place. Ideally, you have to learn how to estimate your budget from your personal costs to your utility coss. The most recent Bureau of Labor Statistics' report on Consumer Expenditures (published April 2015) found that homeowners on average pay $321.75 per month or $3,861 per year for "Utilities, Fuels, and Public Services."