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What costs to anticipate in the first year of homeownership

What costs to anticipate in the first year of homeownership

When people buy homes for the first time, they typically do so with the expectation that their costs will drop. And while this may be true when it comes to issues like the cost of rent versus that of paying down a mortgage, there may also be plenty of unexpected expenses to face if they're not adequately prepared by a real estate professional.

For instance, if people move into an existing home that comes with its own appliances, they may have a need – or desire – to replace or repair those units at some point in the first year of homeownership, according to Money Ning. This can cost hundreds of dollars or more and may be necessary in a lot of cases, but nonetheless it is important for new buyers to think about whether this is something they might have to do, as early as the start of the homebuying process. Most appliances have a lifespan of between 10 and 20 years, so taking stock of that potential need during a sale is critical.

Other expenses to consider
Meanwhile, many owners will also be moving from smaller homes or even apartments into good-sized houses that will necessarily require more furniture, the report said. Often, furniture can be expensive if it's being bought new, but even going online and finding items on Craigslist or similar sites could end up resulting in hundreds of dollars in expenses. And while these may be necessary for a home to feel truly "lived in," it's nonetheless something new owners will have to budget for.

Paying more for common expenses
Meanwhile, many homeowners may not always think about the ways in which a larger home will often result in them paying a lot more for utilities, according to Quicken. Adding potentially hundreds of dollars per month for heating and electrical costs is not out of the norm, and it's definitely something owners will have to budget for/

The same is true of homeowners insurance, which can cost thousands of dollars per year based on a number of factors, the report said. While many people who previously only rented have renters' insurance that costs relatively little each month, homeowners insurance necessarily has to cost a lot more, and for those moving into homes that may be at particular risk for damage, the expense can mount quickly.

Adding everything up together, even beyond mortgage costs, the average homeowner might expect to pay as much as $1,200 per month for all of these expenses, according to Go Banking Rates. Property taxes, homeowners association fees, private mortgage insurance and general home repair and maintenance are some of the other common expenses that people who didn't previously own will suddenly have to pay. While these are by no means hard and fast numbers, they are certainly in the ballpark of what owners will face.

With all this in mind, it's vital for would-be buyers to really think about exactly how much home they can afford as they begin the shopping process, because there's a lot more than just mortgage costs that go into homeownership.

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