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hi this is Anita from Real Estate Crunch
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you know everyone has this dream of
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owning property owning owning a home but
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what a lot of people don't realize is
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with anything there can be hidden costs
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associated with home ownership and I'm
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going to go through some of the major
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ones here some of the major hidden costs
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so that you can be able to understand
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them and this again is so that you can
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make the best informed decision possible
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when you are looking to purchase a home
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the first one is property
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taxes one of the most substantial
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outgoing expenses for homeowners is
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property taxes you know these taxes can
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vary on location property value and
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local government tax you know once well
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some buyers account for this in their
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mortgage calculations others may
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suddenly be caught off guard when they
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realize how much they must pay annually
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before you look to purchase a property
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you need to understand what will be the
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property taxes and also understand are
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those taxes going to go up what will
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cause the taxes to go up just so that
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you're not caught off guard by these
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property taxes you know taxes are
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calculated by the local government and
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they will assess the home's value the
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rates can vary from state to state even
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from you know different areas of the
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same city for example a homeowner in New
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Jersey might pay significantly more in
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property taxes than someone in Wyomi due
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to different tax rates you know so it
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even really depends upon where the
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home's located how much the tax will be
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and all of those other things you need
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to really budget for property taxes
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many mortgage lenders will require
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borrowers pay property taxes through an
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estro account which spreads the cost
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across monthly mortgage payments however
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homeowners who pay property taxes
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separately must set aside that money
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monthly to cover the annual bill and
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this is really essential here because
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you don't want to be caught off guard in
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not paying your property taxes another
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one is homeowners insurance now this has
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really lately has been quite a big deal
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especially as we've looked at the fires
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in in California and some of the natural
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disasters in other places you know
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specifically in natural disasters in a
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place like North Carolina where many
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people they did not have the flood
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insurance even though their house
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flooded you know homeowners insurance is
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essential that a buyer you know needs to
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consider mortgage lenders typically
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require homeowners to carry insurance to
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protect against damage or
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loss you know so insurance is highly
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recommended but there again there's can
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be many factors that affect insurance
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and a lot of insurance companies now
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especially as they're dealing with a lot
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of natural disasters which have been
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extremely costly a lot of them are
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saying they won't insure for this they
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won't insure for that you know maybe
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maybe like in California we're not going
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to insure for the fires you know they
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may not insure for floods and other
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things like that which could happen one
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of them is the location of your home you
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know areas prone to natural disasters
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tend to have higher premiums the home's
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age construction material the coverage
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amount and deductible and security
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features that you have such as alarm
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systems or do you have is your home you
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know resistant to some type of um you
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know fire or other types of things can
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make a difference as to what the
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insurance cost would be you know
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standard homeowner policies may not
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cover certain events such as floods or
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earthquakes so you need to really assess
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and understand whether or not you are in
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a flood area an area which could be a
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fire area an area which is
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earthquakerprone or other natural
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disasters when you're looking at your
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insurance another big one which has
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really come about a lot lately is the
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HOA fees and when you purchase a um a
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home in a community there are usually
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homeowner association fees they'll
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likely be paid monthly or an annually
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there'll be some kind of HOA fee these
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fees can really vary for some areas
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these fees could be one or $2,000 or
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higher even a month in other areas they
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could be you know a couple hundred
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dollars a month a lot of times the HOA
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fees will cover things as landscaping
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exterior maintenance community amenities
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if there's a gym there's a pool there
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security services and trash removal of
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course the more of these type of things
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that you have in your community the more
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you're going to pay for them you know if
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for example if you're in a community
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with a pool but you're not going to ever
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use a pool you may want to decide maybe
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being in another community if if that's
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not what's important for you if it's
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something that is important for you
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maybe paying the HOA fees is great you
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know HOA fees can be a significant
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expense and can increase over time you
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know like an HOA association could
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decide to increase this is I know what
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happened to somebody who bought you know
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into a condo and then suddenly the HOA
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decided they were going to hire a
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management company and the HOA fees
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doubled or tripled almost overnight and
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she wanted to sell her property and had
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a hard time selling it because people
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didn't like the HOA fees you know HOA
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fees in in some cases can cost almost as
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much as a mortgage or rent or something
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needs to be put on top of it so you know
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if your mortgage payment is say $2,000
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and your HOA is you know $7 or $800 a
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month that right there is
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$2,800 plus on top of that is taxes so
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you know you're looking probably close
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to three or $4,000 for for something so
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that really you need to really
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understand what your monthly cost will
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be when you're looking at this not just
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the cost to pay back your mortgage you
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know maintenance and repairs can be
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another thing that you know things like
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the heating air condition systems the
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roof repairs plumbing and electrical
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work and lawn care and landscaping you
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know depending on the size of the
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property can all be things which can
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cost money you need to also plan for
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unexpected repairs it's suggested that a
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homeowner set aside 1% of their home's
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value each year for maintenance and
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repairs for example if the home is worth
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$300,000 the homeowner should have
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around 3,000 annually for upkeep so
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that's just kind of a good thing for you
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to do make sure you have this little you
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know like rainy day fund for u repairs
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and that type of things uh utility and
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energy costs can be something too which
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could which you need to take into
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account you know utility costs can
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fluctuate depending on the size of the
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home the location and the efficiency of
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the appliances for example if you're
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living in a place that's extremely hot
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like you know Arizona you need to run
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your air conditioning all summer long
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this of course could be very expensive
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if you're in a place which is cold and
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you need to wear you know have you know
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heat all winter long can also be
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expensive so larger homes have higher
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electricity bills especially in regions
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with extreme temperatures you know water
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and sewer costs can vary my father years
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ago we had an old farmhouse and we had
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our own well but then the the city came
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in and made us put in a sewage system
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and and put you know get the city water
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and you know he ended up having to sell
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some land because our house was far back
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from the road and they took it from the
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road onward and and so you need to look
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at that and see if you're buying you
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know property you know will the future
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mean that you'll have to you know buy
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into the sewage system or or the city
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water you know all of those type of
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things things you need to understand
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that and maybe put money aside for that
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um you can look at you know energy
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efficient appliances you can look at
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solar panels and other things to be able
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to reduce some of your utility cost you
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need to really look at the cost of
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moving and cost of closing expenses you
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know closing expenses can be very
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expensive there can you know be
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appraisals and inspection fees you know
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title insurance attorney fees you know
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prepaid property taxes also moving costs
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can be very expensive too that you can
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um you know find yourself having to hire
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movers you're going to rent a moving
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truck are you going to purchase packing
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supplies all of those things you should
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look at when you're looking to move into
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a property uh pest control and and
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landscaping can be um expensive
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especially if you live in an area where
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maybe you know pests can get into the
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roof or or other types of things where
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you're going to have to deal with it you
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know that can be costly be expensive or
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something you need to look at lawn care
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you know regular mowing fertilizer
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irrigation systems if you can do all
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that yourself that's great if you're not
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able to you might need to hire someone
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out to do it you know termite
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inspections mosquito treatments and
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rodent controls they can all be
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expensive if if you can do that yourself
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that's great then you know then you can
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do it also um home renovation costs if
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there's things that you need to renovate
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you need to look at that you know common
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home improvement costs include things
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like kitchen and bathroom remodels uh
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flooring replacements exterior paint and
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you know other smart home upgrades so
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these are all things that you need to
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look at these are basically eight hidden
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costs that most home own home owners
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anyone looking to buy a home you should
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look at ahead of time and see exactly
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what these costs are so you can budget
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and plan for it we've written a a blog
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post on this called eight hidden costs
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of home ownership what buyers need to
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know we'll put a dis we'll put a link in
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the description below so that you'll be
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able to check that out we like to thank
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you so much for joining our community
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for being part of uh Real Estate Crunch
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