Immediate Expenses for New Homeowners to Expect

You know you've got a mortgage. But make sure to budget these costs in as well.
Related To:
Cheerful Yellow Laundry Room

Cheerful Yellow Laundry Room

If you don’t already own them and they weren’t included in the purchase of your home, be ready to go shopping for a new washer and dryer.

From: Sarah's House

If you don’t already own them and they weren’t included in the purchase of your home, be ready to go shopping for a new washer and dryer.

After you’ve shelled out the cash for closing costs and a down payment, there are still a few more expenses to expect in addition to your monthly mortgage payment: 

  • Homeowner’s insurance. Often referred to as “hazard insurance” on mortgage documents, homeowner’s insurance protects your investment (and the lender's) from losses in the event of property damage, theft and even liability. The cost of homeowner’s insurance varies widely depending on which company and policies you choose, but you can often save money by bundling your homeowner’s insurance with your auto insurance.
  • Property taxes. For many homeowners, property taxes are the second-largest expense of owning a home (after mortgage interest). In most areas, property taxes are governed by state law, but assessed and collected by the county on an ad valorem basis (ad valorem is Latin for "according to value"). They are calculated annually by applying a certain tax rate to the assessed value of the property.
  • Private mortgage insurance (PMI). If your down payment was less than 20 percent of the mortgage value, you have to pay PMI, which protects the lender against your defaulting on the loan. This can add as much as a couple hundred dollars per month, depending on the size of your loan.
  • HOA fees. If you bought a home in a community with a homeowners association, be prepared to pay HOA fees, which cover maintenance of the community’s common areas. Fees vary widely depending on where you live and what amenities your community offers -- anywhere from $150 a month to as much as $2,000 a month for some luxury buildings in Manhattan.
  • Utilities. If you’re a former renter, you’re probably already used to paying utilities. However, extra square footage can make utility costs for a home much more expensive than an apartment.
  • Cable, Internet, telephone. In addition to the monthly costs of these services, be prepared for initial set-up costs.
  • Appliances and furniture. If you don’t already own them and they weren’t included in the purchase of your home, be ready to equip your home with furniture, appliances, window coverings, lighting and anything else you need to get settled in.
  • Home maintenance necessities. As a new homeowner, you’re now responsible for mowing your lawn, cleaning the gutters and making repairs. Be prepared to purchase a lawnmower, a set of tools and anything else you need to keep your home well maintained.

Next Up

The 5 Most Common Questions From New Homeowners

If you're a new homeowner, you likely have questions about budgeting for your new expenses, adding value to your home and handling post-purchase surprises and challenges. Here, the answers!

What to Expect When You Live by the Water

Living on or near this natural setting brings its own set of challenges.

How to Be a Financially Savvy Homeowner

Many property-related actions trigger a tax or tax benefit.

Homeowner Tax Tip: How to Take More Money Home

The tax advantages of homeownership can help you bring home more money every month and afford a larger mortgage (read: better house) than you may think.

How to Finance a New Home

Tips and insider secrets to getting the best financing deal.

How to Buy in New Construction

Five steps to owning a newly-built home.

6 Things to Know Before Buying a New Home

Avoid the top six mistakes new homebuyers make.

New Short Sale Rules: What You Need to Know

For too long, the experience of going through a short sale had come up, well, short. But new rules make short sales a much faster and easier process.

23 Things Every First-Time Homebuyer Should Know

Seven first-time homebuyers admit their biggest rookie blunders and reveal recession-proof lessons to guarantee home buying success.

House Hunting Tips for Singles

Find your perfect match with these five pointers.

Go Shopping

Refresh your home with stylish products handpicked by HGTV editors.

Watch Live TV

Don't miss your favorite shows. Live stream HGTV now.

Follow Us Everywhere

Join the party! Don't miss HGTV in your favorite social media feeds.