Finding a place of your own is a big deal, especially if it’s you are buying your first home. There are so many factors to consider even before you get to the “let’s put in an offer” phase that when you get there it will feel like you are entering an abyss.
Never fear, Millennial Homeowner has your back! We’ve identified the home ownership costs that you need to know before you put in your offer. That way you can make sure you’re getting the right home for your budget.
When you started looking, you probably qualified for a mortgage, or at the very least played around with a mortgage calculator.
That’s an ok place start. But there is more to it than just a mortgage payment.
Remember the banks job is to tell you how much you qualify for, it’s your job to figure out how much you should actually spend and what you can afford.
Depending on how much of downpayment you have you will need to factor in mortgage insurance.
Whether it’s through the bank, or a private insurer, this is an important consideration.
If you are purchasing a house, you will need to pay property taxes. This is an essential component to owning a house.
A thing to remember about property tax… They rarely go down, and you may owe the rest of the years worth when you are purchasing the house.
Water and Waste
This is another one that you may not have considered in your last place. It’s helpful to know how many people lived in the house you’re buying.
A family of two seniors will use a lot less water than a family of five with three teenagers.
It’s just good to know and it will also help you budget for your monthly expenses.
Your electricity bills will most likely be higher than your last place. Moving from an apartment to a larger place of your own means more of everything.
More lights, more sockets, more things that can suck power. When you’re estimating your costs make sure to factor in the previous owners costs as well as your current use in your place.
If you use A/C (air conditioning), it’s a big suck on your electricity bills. Just another good thing to know.
You want heat in the winter right? That is going to cost you too.
It’s important to know what it will cost you to heat your house through the cold months.
Best way to budget this is to look at the cost during the coldest month of the year and go with that.
If you can get the annual costs and divide it by 12 that will give you a better monthly budget, but know that this is going to fluctuate depending on the weather and frequency of use.
Homeowner Association Fees and/or Condo Fees
Depending on where you live you can have homeowner association (or HOA) fees.
It’s a good idea to ask your realtor how much these are, what they cover and when they are due.
Cable and Internet
If you plan on streaming you will most likely want some sort of Internet package and possibly a cable package.
Make sure you choose a package that represents both your budget and your needs.