True Cost of Home Ownership

Americans have always loved the idea of home ownership. It's the independent maverick in us. But with ownership comes responsibility and with responsibility, cost. It's best to be prepared.

Standard On-Going Expenses

  • PITI: Principle, Interest, Taxes, and Insurance – in short, your note. Ask your lender what the estimated PITI will be on your potential home purchase before putting in your offer. Your Principle and interest will stay the same for the life of the loan. The taxes and insurance are open to fluctuation.
  • HOA: Home Owners Association fees: Basically, these cover your common areas. In a small, suburban neighborhood with few amenities it may only be a few hundred dollars a year. In a gated community or high-end condo in town, that cost can quickly escalate to over a thousand. Pay attention when comparing properties; many will have special assessments – one more bill --while some may include trash pick-up or water – a few less.

Other On-Going Expenses

  • Exterior Maintenance –
    • The Structure:
      • This can be minor, like touch up paint or cleaning or a major expense like total roof replacement. It's a good idea to set aside money every month for both anticipated and unanticipated repairs. Roof life in Houston is considerably less than other parts of the country and our hot summers are particularly tough air conditioning units.
      • Gutters are essential to keep water off your foundation and assure that your yard drains properly.
      • Windows need cleaned, caulked, and occasionally replaced.
      • When purchasing a home, including a home warranty as part of the deal is one way to avoid getting hit with expensive repairs the first year.
    • The Equipment:
      • Ladders
      • Power Tools
    • Yard Maintenance
      • Lawn Mowers
      • Rakes, shovels, & Pruning shears
      • Power Washer
      • Hoses
      • Sprinkler Systems – this is a solid investment in the Houston heat. It will not only save your lawn, it will save your foundation

  • Interior Maintenance
      • Appliances
      • Flooring
      • Paint
      • Plumbing & Electrical
      • Flooring
      • Pest Control
      • Utilities – Ask the seller for a break down so you have an idea as to average costs.

  • Transportation Costs –

In Houston this is a big consideration. Traffic can be difficult and time consuming. Many people prefer the lifestyle afforded by our suburban sprawl, but it does take a toll on vehicles. Budget for wear-and-tear on your car as well as gas, or consider the park-and-ride as an option.

One Time Expenses

WAIT to make major one time purchase until AFTER you've closed. You do not want to jeopardize your financing with a large purchase and you will want to live in your space awhile before you know exactly what suits your new home and the way you live in it.

  • Appliances – sometimes these need upgrading. Be sure to consider the water heater and the HVAC system as well.
  • Furniture -- One word – MEASURE. Furniture looks much smaller in a giant, open show room.
  • Remodeling – Be sure and get estimates before you purchase a home that needs major renovations. What you can't see behind that wall or under that slab can cost you.

Home Ownership is one of the most coveted of all American ideals and is an amazing experience once you're prepared.