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6 Obscure Expenses that Always Surprise First-Time House Hunters

20 Jun
6 Obscure Expenses that Always Surprise First-Time House Hunters

6 Obscure Expenses that Always Surprise First-Time House Hunters

Ever since it took the world by surprise, the coronavirus pandemic has ushered in waves of unforeseen economic trends. One of which is a residential exodus from heavily crowded cities. Many participants in this migration are first-time homeowners, looking to settle down in spacious suburbs. And they’re also joined by an additional population of house hunters, who are coincidentally in the market for new homes during the pandemic. Regardless of what your motives are though, if you happen to be exploring the possibilities of homeownership, it’s important to be thoroughly prepared for this undertaking.

Keep an Eye Out for Hidden Costs:

Personal Finance Expert Rachel Cautero suggests that “Buying your first home is considered one of the biggest milestones — in life as well as finances. It's a big commitment, and there's a good chance this will be the largest purchase you've made to date… but first, you should determine if you are ready to buy a home. Homeownership is a lot more expensive than renting since you're responsible for various added costs.” Many first-time home-buyers are surprised to discover all of the red tape that comes with the territory. But this doesn’t have to shock you if you’re well-informed. Here are few hidden expenses to prepare for when buying a home: 1. Home-Owners Association (HOA) Fees: HOAs are community membership groups which enlist home-owners to fund neighborhood upkeep. HOAs always require the residents of a neighborhood to participate in communal financial contributions. 2. Unexpected Repairs: No matter how pristine a house looks like at first, one or two malfunctions tend to eventually happen out of nowhere. Budget for the likelihood that you’ll have to fix a cracked window here, or faulty faucet there. . 3. Inspection Fees: Depending on how old the home you’re interested in is, it may be necessary to have it formally inspected before committing to a purchase. If an inspection sheds light on any problems, that also translates into more costs. 4. Property Taxes: Investing in any type of an asset automatically incurs taxes. No matter how good the initial price on paper is, you should expect the bottom line to be a little bit higher because of taxation. 5. Closing Costs: The physical act of transferring occupancy to home-buyers isn’t just a one-dimensional transaction. It’s accompanied by cascading legal contracts, liability statements and loan agreements. The fees involved in processing all of this paperwork are standalone expenses referred to as closing costs. 6. Insurance: If there’s one thing you want to protect using insurance, it’s a house. Homeowners Insurance is both an indispensable and inevitable cost you should account for.

Conclusion:

Buying a new house is a very bureaucratic process. It involves multiple levels of vetting, and random financial commitments. If you haven’t done any deep research prior to visiting open-houses, it’s probably a good idea to start before proceeding. Learn about the neighborhoods you intend to move into, and survey their local amenities. Save up money for closing costs, in addition to down payments and projected mortgages. Expect to spend significant cash on expenses which aren’t reflected on publicly advertised price-tags. If you like what you just read from our blog, you’ll love the various informative courses, workshops and events listed on our websites and social media. Whether you’re interested in personal development, or overall improvement of your business, give us a call at 1 (888) 823-7757 to find out how The RISE Academy can help you break past your daily struggles and start soaring in success.