As a tenant you’ve never had to worry about paying property taxes. That’s going to change when you become a home owner. It won’t be surprise – The Northumberland Home Values Group agent you’re working with will make sure you know what to expect. But these are costs that can increase every year and you need to plan for them.
Perhaps you’re used to leaving the lights on, or turning up the thermostat, because all those costs were included in your rent, or your mom and dad paid for them, you will have to include them in your monthly budget, and don’t forget, those costs fluctuate with the seasons.
As a tenant you probably always had “renter insurance” or “contents” insurance. This is a policy you take out to protect against loss or damage to your personal items inside the space you’re renting. When you become a home owner you’ll need to several other types of protection as well. You’ll need to get insurance on the structures and property in case of fire or other damage. You’ll also have to arrange liability insurance. Protection against someone getting hurt on your property, maybe slipping on the sidewalk or tripping a cord. Prices can vary, depending on your home and neighbourhood. Do your research! Talk to an insurance broker to negotiate the best terms and price for your needs.
As the home owner you’ll now need to connect to and pay for the local municipal services. Some areas charge extra for water, garbage removal and recycling.
If you had an apartment before this may not be a surprise, but you’ll need to make arrangements for cable, internet connections. Maybe even a landline !!!
Increases Because of Your New Address
Will you have to drive further to get to your job? What about parking? If you take public transit, will it cost you more or is the commute shorter. This is a hidden or soft cost that many don’t think about until they realize they are filling up the car more often, and the oil needs changing sooner. Over time these costs can be significant.
If you have a security system, you have to consider monitoring fees.
Cleaning New Property
Home maintenance, like carpet cleaning, changing furnace filters, clearing eaves troughs and touching up interior and exterior paint is very common. Especially when you move into a new place. You may want to change some colors or replace some carpet. Even if you do a lot of it yourself, it will still cost money to seal the wood deck, buy mulch for landscaping and few additional plants you think you should put in.
The never ending repairs, some big like replacing the roof, furnace and air conditioning and some smaller like appliances and furniture always need to be planned for. . Experts recommend that you set aside at least 1% of the value of your home each year for this.
Keep all this in mind when you are looking for a home and financing. Don’t leave yourself “house-poor”. You will enjoy the house a lot more when you budget for all these costs and know that you still have a bit left over for your “fun” times.