Home-buying is the biggest single expense most Americans will ever have. But once you have the keys to your kingdom, the costs just keep coming.
In an uncertain economy, many people are surprised by the cost to maintain that dream due to numerous hidden expenses. As a result, home improvement stores these days are seeing more homeowners doing what they can to keep their costs down.
"Right now, I'm redoing my kitchen," said Stephanie Henry.
Henry says she can no longer afford to hire contractors to fix things around her home.
"If you YouTube it, you can do it yourself instead of paying somebody twice as much," she said.
See all the things that make owning a home so expensive:
Expenses add up to thousands a year
A new study by Bankrate found that the hidden costs of owning and maintaining a home amount to more than $21,000 a year. Maintenance costs top the list, along with ongoing expenses like utilities, property taxes, home insurance, and internet and cable.
Linda Bell, home lending expert at Bankrate, says homebuyers can't just think about the cost of the mortgage.
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"We call them hidden costs because, not because homeowners don't necessarily know about them, but they don't adequately budget for them when they buy a home," Bell said.
Adding to the expense: the U.S. Census Bureau found that almost half of U.S. owner-occupied homes were built before 1980. Bell stresses that older homes may require more attention, and those costs should be budgeted.
"They need maybe a new HVAC system, maybe a roof," she said.
Some things you can do
To cut down on insurance costs, she suggests revisiting your policy each year and shopping around for a lower premium.
"Decide do I need to change my homeowner's insurance, look at the rates, look at everything, and decide whether to stay with them," Bell said.
It's crucial for homeowners to save money for unexpected expenses, according to Bell.
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"You should save about 1 to 4% of your home's value," she said.
Homeowners may consider a utility billing plan with fixed monthly payments and consider appealing their home's valuation if they are concerned it will result in higher property taxes.
Because, as Henry said, owning a home "is really expensive."
That way you don't waste your money.
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This story was reported on-air by a journalist and has been converted to this platform with the assistance of AI. Our editorial team verifies all reporting on all platforms for fairness and accuracy.
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