The cost to own a home is more than just your mortgage payments. It also includes insurance, utilities, maintenance and more. Here are a few examples of, and advice on how to manage, costs related to owning a home.
You’ve made your down payment, you know what your mortgage payment is and when it’s coming out of your bank account – that should be it for costs for the year, right?
When my boyfriend and I bought our house, it felt like all we were doing was spending money related to our house and paying bills. We were fortunate to have negotiated some furniture in the sale and were each bringing some pieces with us, which helped us financially, but what we didn’t realize were a lot of extra expenses, we hadn’t anticipated for. Having lived at home with my parents for my whole life, except for when I lived in Australia, I didn’t really understand all the additional annual costs that exist when you own a house.
When it comes to homeownership, there are many expenses that may come your way, without you realizing. Here are a few examples, and advice on managing these expenses, from my personal experience.
Expenses you don’t have a choice about
- House insurance – protected for the unexpected: If you own a house, you need house insurance which will protect you if something bad were to happen such as a fire or flood. Even if it wasn’t a requirement of a mortgage, which it is, you definitely want to have house insurance in place and ensure you’re continually renewing your insurance so that you’re covered if the unexpected were to happen. Tip: You can set up a separate bank account to transfer money into every month so when your insurance comes due, you have the money ready to pay it.
- Property taxes – we have to pay to play: Every year, you’re required to pay an assessed amount to the city or town you live in. This money goes to help pay for education, libraries, road repairs, and other city/town projects. For more information check out https://www.saskatchewan.ca/government/municipal-administration/taxation-and-service-fees/municipal-property-tax-tools. Tip: Paying a lump sum can be tough, but in Regina and Saskatoon, you have the option to pay monthly instalments through the TIIPS program which can make it a bit easier. If monthly payments aren’t an option for you, set money aside each month into a separate account, helping you to save and prepare for the large annual expense.
- Utilities – keeping the lights on and water running: Water and heat are essential and typically when you move into your new home you’ll have to pay a fee to install these services. Additionally, as a first-time homeowner, you may be required to pay a deposit for your utilities. Tip: Prior to moving into your home, contact your local utility companies to schedule these services and ask what fees they charge for installation. Be sure to add these expenses into your budget for the month you move in.
Expenses you may not expect
- Water softener – I prefer soft hair: Depending where you live in Saskatchewan and whether it’s a new build or not, your new house may not come with a water softener. A water softner is optional, and if you prefer to have one there are several options available to you: rent, finance or buy. All three have benefits and it’s comes down to what will best fit your needs.
- Water heater – what’s an anode rod?: You have hot water every time you turn on the tap. That should be all you have to worry about, yes? What some don’t realize is there’s annual maintenance that needs to be done to keep you enjoying those hot bubble baths. Although some things you can do yourself, sometimes its best to leave it to the pros if you’re not too handy, and call in a professional to do the maintenance work, which will be an additional annual expense for you.
Expenses you can choose
- Cable and internet – Grey’s Anatomy still on and gets me every time: When we first moved in, I didn’t think we really needed anything more than a basic tv package and basic internet. While that’s true, we ended up wanting more after realizing how many great tv shows are on – thank goodness for PVR. Tip: When choosing a cable package, pick one that’s best for you and works within your budget. If needing to reduce expenses within your budget, consider re-looking at your cable package and downsizing to free up some extra money.
- Landscaping – flowers are so pretty: Our house was a new build, so our backyard was bare at move in. After pulling all the weeds that were the size of shrubs, the first thing we did was bring in soil to raise and even out the yard, so we could lay sod, and then gravel to build a parking pad. We hired someone to build a fence – as stated earlier, some things are better left to professionals – and planted some trees in the front. We were fortunate to have friends and family help us with this, but it was an expense we hadn’t thought about. Tip: Yard maintenance will be an annual expense. Save money throughout the year to help cover yard maintenance costs including unexpected costs like having to replant trees in the front because the rabbits got to them.
These are just a few examples of homeownership expenses I’ve come across in the last year. There are many other expenses, such as home maintenance, and it’s crucial to budget for these costs – especially the ones you don’t have a choice about first -so that you have a realistic idea of what you can afford and are prepared when these expenses are incurred. This is especially true for those months that you will have a bigger payment like your insurance or property taxes, etc.
Are you a homeowner? What are some expenses you’ve come across that you may not have anticipated? What advice do you have for first-time homebuyers? Share with me in the comments below so I can learn more and proactively prepare.
Born and raised in Regina, but preferring the big city vibe, I got my chance when I moved to Sydney, Australia for grad school. And then I realized there’s no place like home. So I came back to Regina, met my boyfriend, we bought a house and are now building a life here…(Full Bio in “Meet The Authors”)
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