The Real Costs of Homeownership: What to Expect After Buying a House

Buying a house is an exciting milestone, but the costs don’t end with the down payment and mortgage. As a new homeowner, you’ll need to budget for a variety of ongoing expenses that come with owning a property. Understanding these costs can help you better prepare financially and avoid any surprises down the road. Let’s explore the various expenses you can expect to pay after purchasing a home.

Mortgage Payments

The most obvious ongoing cost of homeownership is your monthly mortgage payment. This typically includes:

  • Principal: The portion of your payment that goes towards paying off the loan balance.
  • Interest: The cost of borrowing the money from the lender.
  • Property Taxes: Local taxes based on the assessed value of your home.
  • Homeowners Insurance: Coverage that protects your home and belongings against damage or loss.

Depending on your loan terms, your mortgage payment may also include private mortgage insurance (PMI) if your down payment was less than 20% of the home’s value.


Unlike renting, where utilities are often included in the rent, homeowners are responsible for paying the following utility costs:

  • Electricity
  • Natural Gas or Heating Oil
  • Water and Sewer
  • Cable/Internet/Phone

These costs can vary significantly depending on the size of your home, the efficiency of your appliances and systems, and your household’s usage patterns.

Home Maintenance and Repairs

As a homeowner, you’ll need to budget for ongoing maintenance and unexpected repairs. These costs can include:

  • HVAC System Maintenance (heating, ventilation, and air conditioning)
  • Roof Repairs or Replacement
  • Plumbing Issues
  • Electrical System Repairs
  • Appliance Repairs or Replacements
  • Pest Control
  • Landscaping and Lawn Care

It’s recommended to set aside 1-4% of your home’s value annually for maintenance and repair costs.

Homeowners Association (HOA) Fees

If your home is part of a community with a homeowners association (HOA), you’ll need to pay monthly or annual fees. These fees cover the costs of maintaining common areas, amenities (such as pools or parks), and other services provided by the HOA.

Home Improvements and Renovations

Over time, you may want to make cosmetic or functional updates to your home. These costs can include:

  • Remodeling Projects (kitchen, bathroom, etc.)
  • Energy-Efficient Upgrades (windows, insulation, etc.)
  • Landscaping and Outdoor Improvements
  • Home Security Systems

While not strictly necessary, these improvements can add value and enjoyment to your home.

Other Potential Costs

Depending on your situation, you may also need to budget for:

  • Flood Insurance (if your home is in a high-risk area)
  • Homeowners Association (HOA) Special Assessments
  • Moving Costs (if you plan to relocate)
  • Furniture and Appliances (if your new home is unfurnished)

By understanding and budgeting for these ongoing costs, you can better prepare for the financial responsibilities of homeownership. Remember, owning a home is a long-term investment, and proper planning can help you enjoy the benefits while minimizing any financial strain.

What Should You Do After Buying a House?


Do you have to pay for anything after buying a house?

Homes have some predictable ongoing costs, including a monthly mortgage payment, property taxes, property insurance, and an HOA, if applicable. Other expenses, such as maintenance and repair costs, are less predictable but worth budgeting for so that you aren’t surprised when sporadic expenses come up.

What payments do you make when you own a house?

We touched on this earlier, but your mortgage payment includes more than the total amount of your home loan. It typically also includes taxes and homeowners insurance. An easy way to remember what makes up your mortgage payment is the acronym PITI: principal, interest, taxes and insurance.

How much money do you have leftover after you buy a house?

Given all of these factors, most experts recommend having a minimum of 6-9 months’ worth of living expenses after closing. Some advise having up to 20% of the home’s value leftover in cash reserves, though this is not practical for every home buyer. Ultimately how much you need depends on your own financial situation.

What are the hidden costs of buying a new house?

The “hidden” costs of buying a home include loan costs, title costs, documentation costs, property costs, and third-party services. The “hidden” costs of owning a home include insurance, taxes, homeowners association fees, emergency repairs, exterior maintenance, landscaping, interior maintenance, and utilities.

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