Buying a New Home – The Complete Budget

As a new homeowner, you are excited and ready to sign those papers and get your new home’s keys. But before you do so, you need to make sure you are also ready for the “new” bills you will also be getting with the purchase.

To help you prepare your budget for your new home, here are ten expenses that you need to be aware of:

1. Mortgage

Your mortgage will be the most expensive element in your budget. You will be paying this off for the next 15 or 30 years so make sure you are comfortably prepared to handle the monthly expense.

2. Taxes

Make sure you research the regulations for property taxes in your area, being prepared to pay property taxes twice a year. This expense can depend on where you live as your taxes can fluctuate yearly or be a fixed rate based on the amount you paid for your home.

3. Insurance for your Home

You can save money on your home insurance by bundling it with other insurances such as your auto insurance. Insurance cost depends on where you live and what your house looks like so be sure to check in with your insurance company to get an estimate to help you accurately plan your budget.

4. Natural Disasters

The weather is changing constantly and you never know when you are going to be hit by the next big storm. Ensure that you are prepared by purchasing hazard insurance to cover any unexpected damages.

5. Housing Costs

Depending on where and the style of home you buy, you may need to pay a monthly fee for things such as maintaining the grounds or for facilities such as swimming pools, fitness centers, etc.

6. Electricity, A/C, etc

Chances are you’re already used to paying utilities, but you will need to keep in mind that if you are upgrading the size of your living space, you may be heating and cooling a larger area now. It is also worth mentioning that if you are going from renting to owning your home, you will also be paying for services such as trash removal.

7. Major Costs

Making a major repair of renovation – like replacing the roof or building out the perfect master suite – can cost a major amount of money. Whether it is a needed expense or a nice luxury you will want to make sure your personal savings does not take a hit, so be sure to build these kinds of costs into your budget.

8. Recurring Maintenance

Appliances breaking or needing to be fixed is bound to happen, and always at the wrong time! Putting in a place a “Rainy Day Savings Fund” helps to make these untimely occurrences go a little smoother.

9. Maintaining Your Outdoors

No matter where you live or what your house looks like you will need to spend money maintaining your home’s exterior. If you are handy, you will be able to save some money, but some situations might call for a professional help (ie: fixing the broken pool filter).

10. Furnishing Your Home

Now that you are ready to move in you will want someplace to kick your feet up and rest.  Furnishing your new home can be an expensive endeavor, which will most likely be front loaded when you move in. But you do not have to completely furnish on Day 1. Decide on what furnishings are essential and which you can space out purchasing over the coming months.

Buying a new home is an exciting opportunity. But before you begin the process, make sure that you have a firm grasp on the complete picture of the ensuing home expenses. Taxes, insurance, maintenance and moving costs can all add up. Being aware of them gives you the best chance to prepare for them!