The cost of owning a home is not limited to your mortgage payments; there are major expenses for new homeowners that you should be aware of so that you can prepare and not be caught by surprise when they come up. Here are some major expenses for new homeowners to keep in mind when shopping for or building your new home in Colorado Springs:
- Homeowner’s insurance. Also known as “hazard insurance” on mortgage documents, homeowner’s insurance protects both your investment and the lender’s from losses in the event of property damage, theft and even liability. Homeowner’s insurance prices vary widely between companies and policies. You may be able to save money by buying homeowner’s insurance from your auto insurance provider, as many companies not only offer discounts for insuring more than one vehicle but also offer a multi-line discount when purchasing different types of insurance policies.
- Private mortgage insurance (PMI). This insurance is required if your down payment was less than 20 percent of the mortgage value of your home. This insurance protects the lender in case you default on your loan. You will need to plan for this expense, as it can add as much as a couple hundred dollars per month to the cost of owning a home, depending on the size of your loan.
- HOA fees. Be prepared to pay HOA fees, which cover maintenance of the community’s common areas, if you bought into a neighborhood with a homeowner’s association. Fees vary widely depending on where you live and what services your community offers. Contact your local HOA for a list of their rules and restrictions, and what your HOA fees get you as a member of their community.
- Property taxes. Mortgage interest will probably be the largest expense of owning a home, but property taxes are a close second. State law usually governs your property taxes, but they are assessed and collected by your local County government, which assesses taxes owed according to the value of your property.
- If your new home is significantly larger than your previous one, the extra square footage can make your monthly utility bill much more expensive. If you are buying a pre-existing home, you can contact your local utility company and ask for a 12-month history of that address. This will give you some idea of what to expect to pay for your utilities if the family size is the same. Your cost may vary, depending on lifestyle, but you will at least have a ballpark idea of the cost of heating and cooling your new home.
- Cable, Internet, telephone. Be prepared for initial set-up costs for these services, if you cannot transfer your existing accounts to the new address. Consider an internet subscription service such as Netflix or Hulu to reduce the cost of television. Many internet providers offer packages that can also help lower your bill.
- Appliances, window treatments, and furniture. If you don’t already own them or they weren’t included in the purchase of your home, be prepared to spend some money to equip your new home with furniture, appliances, window treatments, lighting, outdoor furniture, accessories, grills, and other amenities that will make your house a home.
- Home maintenance necessities. If you have been living in an apartment or condo with a maintenance man on call, you may not be thinking about all the things required to run a house without that luxury. As a homeowner, it is now your job to mow the lawn, remove leaves in fall and snow in winter, clean the gutters, fix, repair, or replace appliances that fail, and maintain heating and cooling systems. You may need to purchase a lawnmower, tools, and equipment to keep your new home well maintained.
- If your home does not have the curb appeal you desire, you will need to either supply it yourself or be prepared to pay a landscape architect to achieve the look and feel you want.
- If you are buying a home that you want to change or upgrade, consider the cost of purchasing paint and other materials (are you adding stone to the fireplace front, installing pavers, adding a pergola to the back patio?) as well as any labor involved if you are hiring a contractor to do the work.
To help keep extra expenses to a minimum when it comes to your new home, Jayden Homes can help. When we build a home for you, you choose a floor plan that meets your needs and you also choose all of your home’s fixtures, colors, and other essentials so that the extra costs once construction is complete are minimized. We have been making homeowners’ dreams come true since 1988, and would love to create one just for you. Contact us today at (719) 535-9030 or (719) 499-4400, and let us help make your dream home a reality.