You’re excited! You just decided to buy your first place. So now you’re going through the process to see how much home you can afford. Your mortgage lender will likely talk to you about some extras like taxes and insurance while you’re getting pre-approved. Here are 5 more costs to consider before you purchase your first place.
- Maintenance and repairs. HGTV recommends saving one to three percent of the purchase price of your home each year for home maintenance. So if you’re planning to purchase a $200,000 home, plan to set aside at least $2000 per year for maintenance.
- Furniture. If you’re moving from an apartment to a home, you’ll likely need more furniture to fill your new space. This is a great time to assess your needs and style to determine if you need a brand new living room set or if the hand-me-down couch from your aunt will work.
- Yard care and snow removal. Your dream home might come with a lush, beautiful lawn and you’ll need to take care of it. You may hire a lawn servicing company or purchase your own mower and trimmer, but consider the cost for both. The same goes for snow removal; you’ll either need to hire it out or purchase equipment to get the job done.
- Utilities. If you’re upgrading your living space with your new home, plan to upgrade the cost of your utilities such as heating and cooling. More square footage equals more money. And consider all utilities in your new place. Ask yourself - will you get traditional cable, or go for Netflix, Hulu or another streaming option, or skip it all together?
- Upgrades and add-ons. As you’re house hunting, consider each home and the extra costs specific to each place. Will you need new appliances? What about updating the floors? Or a new bathroom? You should have a plan for each home upgrade, and how much cost it adds to your budget.
Buying your first place is very exciting. Not so exciting? Being house-poor. Consider these hidden costs of home ownership so you will be able to enjoy your new home without the stress of how you’re going to pay for it.
Nikki Rue, Mutual 1st Federal