Understanding the True Costs of Homeownership

When you’re considering buying a home in Boston, it’s important to take a close look at your finances. As you may already know, it’s recommended that you make a 20 percent down payment at the time of purchase. The difference between the cash you put down and the sale price is covered by a loan with payments made to your lender each month. Beyond paying down the principle and interest on your mortgage, there are several other fixed and varying costs associated with homeownership. To make sure you’re prepared for the financial responsibility that comes along with owning a piece of the Boston real estate market, I’ve summarized some of the expenses you can expect on an ongoing and intermittent basis.

Fixed

Property Taxes

Once you buy a home in Boston, the amount of property tax you’ll pay will depend on the value of your home. The more expensive the property, the more you’ll pay in taxes. You can use a property tax calculator to get a rough idea of what you should budget.

Homeowners Insurance

As a homeowner, it’s highly recommended to protect your largest asset with homeowners insurance. In the event of damage or destruction, you want to be sure you, your loved ones, and your valuables are covered.

Homeowner Association Fees

If you buy a condo or townhouse, or choose to buy a home in Boston that is within the jurisdiction of a homeowner association, you will have to pay a monthly HOA fee. Costs covered under this fee can include everything from landscaping, to maintenance, to garbage and snow removal.

Intermittent

Repairs & Maintenance

Unless you live in a condo or townhouse and pay a monthly HOA fee, buying a home in Boston means paying for your own home repairs and maintenance. You’ll be on the line for everything from minor touchups to major projects, so it’s advised you have an emergency fund to dip into.

Exterior Upkeep

Even if you go the do-it-yourself route, costs associated with landscaping, snow removal, and driveway and sidewalk upkeep can add up. Be sure you factor in these expenses when setting a budget for your new life as a homeowner.

Remodeling Projects

One of the most liberating things about homeownership is having the ability to make your space your own. However, remodeling every room in your home comes at a price. Redoing your hardwood floors and modernizing your kitchen or bath can be very costly, so prioritize what needs to get done first and spread the projects out over an extended period of time.

I hope this summary has given you a clearer picture of the financial commitments of homeownership! Though there are a variety of costs involved, the pride in owning a home and the equity you’ll build over time are well worth the ongoing and intermittent expenses. If you’ve set aside enough money for your down payment, closing costs, your first several mortgage payments and an emergency fund for repairs, you’re well on your way to buying a home in Boston. Please contact me when you’re ready to kick off your search!

Ken Snyder
Keller Williams Realty Boston-Metro
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