LOCAL RECORDS OFFICE: Congratulations you just purchased the house of your dream, but right after you moved in you noticed it comes with some strings attached, is it too good to be true? Maybe. When you’re buying a new home (and that could be a new build or a used home that’s new to you) you are caught up in a whirlwind of things to do, people to see, papers to sign, and plans to make says, Local Records Office.
Being a homeowner has been your dream since you were a kid and you finally accomplished it.
READ MORE: 5 Things Homeowners Insurance Won’t Cover
Then, moving day comes. Once all the boxes are unloaded, and the furniture is shoved roughly into the right rooms, you grab a coffee and take a breather. And that’s when it dawns on you. This is only just the beginning.
As a new homeowner, there are whole lists of things you need to take care of, and almost all of them cost money. A lot of money. Watch more videos here.
So, if you’re planning to buy a new home, have just signed the paperwork, or are moving in next week, this list is for you. And if you know someone who’s moving in, be a buddy and warn him or her as well.
- Property Tax – Up to $10,000
When it comes to property tax, a lot of people get sticker shock a year after they move into a new construction. The reason for this is simple; the taxes are based on the empty lot the home was built on says, Local Records Office. But a year later, the assessors come around and put a new valuation on the lot, which now has a beautiful home sitting on it. Many people see their initial tax payment double, or even triple, in just one year. You can also face much higher taxes based on the particular school district you live in. And of course, taxes vary greatly by state. The average property taxes paid in New Jersey are almost $8,000, as opposed to $2,000 in Colorado.
READ MORE: Forced to Sell Your House Due to a Divorce
- Major Appliances – Up to $10,000
New home builds usually include a dishwasher, microwave, and stove, with the option of a fridge/freezer, washer, and dryer. They are basic, unless you opt for the upgrades in your contract, but if you do, they could add a chunk to your monthly mortgage payment. If you buy a used home, you may not have any appliances included, especially on a repossession, short sale, or foreclosure. You could always hunt around on Craigslist for used appliances, but they won’t come with a warranty. So figure on spending a nice chunk of change when the time comes to upgrade.
- HOA Fees – Up to $700 a Month
Many new homes come with a Home Owners Association, and most used homes have HOAs as well. In theory, they’re a sound idea. They are their to keep the neighborhood looking great, and deal with trash collection, playgrounds, community pools, street lighting, common areas, snow removal, and so on. Of course, in practice many people hate the HOA because they extend their reach far beyond what most people consider fair. They can tell you what colors you can and can’t paint your house, what type of blinds and window treatments are allowed, what you can and can’t put in your yard, and the list goes on. Oh, and it costs you. A typical HOA can run $100 a month. Some are just a few hundred a year, while in the higher-end neighborhoods; you may not see much change out of $1,000 every month.
- Insurance – Up to $2,000 Annually
There are a few different types of insurance you need to have when buying a home. First, you must have homeowners insurance. The average cost of this is around $700 annually, but this again varies by state. If you live in a duplex or other type of connected building, the insurance may be covered in your HOA dues or your monthly escrow. You should also have contents insurance, based on the value of your possessions. You could, of course, skip this payment. But if tragedy does strike, you could lose everything.
- Utilities – Up to $400 Monthly
Again, if you live in the Playboy mansion that figure will be greater. And in a new one-bedroom apartment, much less. But on average, when moving into a new home, you will see utility bills in the hundreds of dollars. This can be quite a shock, especially if you were formerly in a small apartment or even living with your parents.
- Repairs and Maintenance – Who Knows!
I saved the worst till last. One of the biggest unknown expenses of owning a home is the repairs and maintenance costs that can hit you out of nowhere. If you were formerly renting, that was all taken care of. Now it’s all on you. If the boiler blows up, you pay. If the roof leaks, you pay. If strong winds blow your fence down, you pay. If vandals put rocks through your windows, you pay.
Yes being a homeowner is the American dream but it doesn’t always come cheap. There are a lot of hidden fees and expenses that new homeowners find out the hard way.