8 Ongoing Expenses to Budget for New Home Owners

buy_me_clip_art_9423You have decided to purchase your dream home and are planning your budget for the first year.  There are 8 major expenses that you need to make sure are included in your figures so there are no surprises at the end of the year!

8 Major Expenses to Consider

  1. Principal, interest, taxes and insurance – usually referred to PITI.  Of course your major concern is your mortgage payment and making sure that you budget for that each month.  In today’s market it could be lower than you paid for rent but there are additional costs associated with that mortgage payment.  Usually the mortgage company wants to include monthly payments for your property taxes and homeowners insurance so they can make sure those payments are kept current.  This is a nice feature because you know your payments are made but does add a lot to the monthly amount.  Although your mortgage payment will not change, the taxes and insurance payments may change each year.
  2. Homeowner Association (HOA) Fees – if you live in a community or condo where fees are charged, you must make sure that you include them in your budget.  These fees are usually paid quarterly and can include some of the maintenance or utilities that you would otherwise need to pay yourself.  Make sure that you understand what is included in your monthly fees so your budget is accurate.  Many communities include lawn maintenance and irrigation in the fees so this can save you a lot on out of pocket expenses.
  3. Exterior maintenance – if you pay association fees much of the exterior maintenance may be covered in those fees but make sure you know which ones are not.  If you live in a home with no fees all of the exterior repairs and maintenance will need to be considered in your budget.  Some of the jobs you can do yourself but remember you will need to buy the tools to complete the repairs and those can be a costly one time expense.
  4. Interior maintenance – if you were renting you probably didn’t have to worry too much about exterior or interior maintenance but now all those little things that break are your responsibility to fix.  Again you will need to purchase tools that you need to complete these repairs.
  5. Utilities – the cost of these will vary depending on whether you live in a community with fees or own a single family home.  Electric will always be a homeowner expense, as it was when you were renting, but the bill will increase with the larger home.  Also water and sewer can be included in HOA fees or no charge if you are on well and septic but city water and sewer can add to your monthly budget.
  6. Yard care – luckily here in sunny Naples we don’t have to worry about snow removal, but we do have year round yard maintenance to consider if it is not covered by your HOA fees.  It is always something you can take care of yourself but remember you will need to purchase the tools to take care of the yard.  In a large acreage, you will probably need to consider a riding lawnmower as it is very hot in the summer to be pushing a lawnmower!
  7. Pest control – here in Naples it is a good idea to have interior pest control on a contract where the company comes monthly or quarterly to spray.  If you want to do it yourself, make sure that you do it at least monthly to keep the pests out of your home.
  8. Transportation – gas prices are increasing all the time and it may be that your new home is further away from your job than your rental home was.  Consider the price of gas and the lower cost of living further from your job and decide which is the better value.  To pay more for a home that is closer to work or pay the additional cost of gas.

Budget Done?  What is Next?

Now your budget is complete and it is time to call a real estate professional to help you find your home and work out these expenses.  Contact me or call me at 239-601-3174 so that we can search for that dream home together.  Or start your search here to see what is available in the Naples area.

Home ownership is a wonderful part of the American lifestyle and now is a perfect time for you to plan your dream.

Remember, it is always toasty in Naples and you deserve a piece of Naples sunshine!

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