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Homeownership is even more expensive than you think

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Here’s what: Homeownership is nightmarishly expensive

I bought a house back in December 2020, and I got lucky: My three-bedroom Philadelphia rowhome cost a very meager $210,000, and I even got my seller to agree to write a $10,000 check to the electrical company to redo all the wiring in my house. So, yeah, very lucky.

I was also pretty well prepared for the costs of homeownership — I had savings set aside for repairs and new furniture, and I knew there was more to buying a home than just the down payment and closing costs. But I don’t think I could have prepared myself for exactly how expensive homeownership has been thus far.

In my roughly seven months in this house, I’ve spent over $11,000 on repairs alone. 

A few highlights:

  • New roofing and repairs to the masonry on the front of the house: $3,450
  • Emergency vinyl siding installation to repair a leak in the kitchen: $2,500
  • Brand new waste pipe: $1,377
  • HVAC service and repairs: $545 

The list goes on. The point is — this place is costing me a fortune. But there were a few things I did before buying the house that have kept me from stress-eating my own hair.

First of all, I bought less house than I could afford. I went from paying $2,000 a month in rent in Los Angeles to just over $1,200 a month for my mortgage, and those savings have helped me cover all my planned (and unexpected) costs.

I also had a few thousand dollars saved for necessary home stuff (like planned repairs), and I had a full emergency fund to cover me in the event of, well, an emergency.

And, finally, I automatically save $200 every month in a “house fund” in my high-yield savings account. Financial planners recommend saving between 1 and 4% of the value of your home each year to cover repairs, and I’m right in that range. This automatic savings means I always have a pot of money to spend on my house, no matter what’s going on with the rest of my budget.

So, the moral of the story: Planning is absolutely key to homeownership, and you’ll need more money than you think. Costs aside, though, I definitely sleep better at night knowing I own my house and a landlord can’t jack up the rent or kick me out at a moment’s notice.

Stephanie Hallett, senior editor of Personal Finance Insider and Certified Educator in Personal Finance


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More stories about buying a home

3 questions to ask yourself before you buy a home in this market, according to a financial planner

Financial planner Anna N’Jie-Konte always tells her clients to ask themselves: why you want to buy right now; what else you can spend your money on to build wealth; and whether or not you’re paying a reasonable price.

The pandemic convinced me it was finally time to buy a home, despite years thinking I’d rent forever

After years and tens of thousands spent on rent in London, writer Daniel Ross finally realized homeownership was the best way to make his dreams of traveling the world come true.

A couple that paid off their entire mortgage in 3 years followed 4 money rules to make it happen

Many homeowners dream of being mortgage-free, but this couple actually managed to do it by throwing all their extra cash at the loan and refinancing shortly after buying their home.

I thought I wanted to buy a ‘dream home’ but had to settle for an ‘OK home’ in this wild market — and I couldn’t be happier about it

Writer Olivia Christensen was searching for the perfect home that required no changes, but when she realized that was an impossible dream, she was free to find something even better.

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