Purchasing a home or condo is an exciting milestone in life, but it also comes with its fair share of expenses. As a realtor, I often see first-time homebuyers who are surprised by the additional costs associated with purchasing a property.
To help you prepare for this investment, I’ve put together a list of expenses to expect when purchasing your home or condo.
Down payment: The down payment is a percentage of the home’s purchase price that you pay upfront. This payment is typically between 5% and 20% of the purchase price, depending on the type of loan and your credit history. Be prepared to have this money available at closing.
Closing costs: Closing costs are fees associated with finalizing the purchase of your home. These costs can include legal fees, appraisal fees, title insurance, and other expenses. In general, you can expect to pay between 2% and 5% of the purchase price in closing costs.
Home inspection: Before purchasing a property, it’s important to have it inspected by a professional to identify any potential issues. The cost of a home inspection can range from $300 to $500 or more, depending on the size and age of the property.
Appraisal: Your lender may require an appraisal to determine the value of the property you’re purchasing. The cost of an appraisal can vary, but you can expect to pay between $300 and $500.
Property taxes: Property taxes are a recurring expense that you’ll need to pay each year. The amount you pay will depend on the value of the property and the local tax rate.
Homeowners insurance: Homeowners insurance is essential for protecting your investment. The cost of insurance will depend on the size, location, and age of the property.
Homeowners association fees: If you’re purchasing a condo or a property within a planned community, you may be required to pay homeowners association (HOA) fees. These fees can cover expenses such as maintenance, landscaping, and security.
Utilities: Don’t forget to budget for utilities such as electricity, gas, water, and internet/cable services. These expenses can add up quickly, especially if you’re moving into a larger property.
Moving expenses: Finally, don’t forget about the cost of moving. This can include hiring movers, renting a moving truck, and purchasing packing supplies.
In conclusion, purchasing a home or condo involves more than just the purchase price.
Be sure to budget for the additional expenses associated with closing costs, inspections, taxes, insurance, HOA fees, utilities, and moving expenses.
As a realtor, I recommend that you work closely with your lender and real estate agent to understand all of the costs associated with your purchase and budget accordingly.
With proper planning, you can make your dream of homeownership a reality.
Buy and sell tomorrow with Dan Amaro:
(419) 845-8928
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