Budgeting for a New Home in Harrisburg PA: For many, homeownership is still the dream. Moving from renting to homeownership can seem like it's an impossible mission. But if you plan ahead and carefully budget, the goal of homeownership can be yours. But, you must budget for a new home.
When budgeting for a new home, it's important to understand and anticipate the costs of owning and maintaining a home. Here are a few things that some buyers forget to include when budgeting for a new home.
When Budgeting for a New Home: Include Private Mortgage Insurance
This is added on to your mortgage when the down payment is less than 20 percent. You can buy a home with less money but you'll pay the PMI which covers the lender should a homebuyer default on the loan. As you build up equity, your PMI drops off.
When Budgeting for a New Home: Include Taxes
Property taxes generate revenue for municipalities, counties, and schools. It's an expense that can vary across the U.S. However, on average, locally we are around 2.25 % +/- of the home's value.
When Budgeting for a New Home: Include HOA Fees
Homeowners' Association fees (HOA) can add several hundred dollars to your monthly household expenses. These HOAs help to maintain common areas, typically within condominium complexes. They also govern what can be done to the unit and the surrounding area. While there is an upside to HOAs, some buyers prefer to have more freedom over their property, perhaps, until the neighbor paints his house turquoise with red accents.
When Budgeting for a New Home: Include Homeowner's insurance
Lenders require homeowner's insurance on your property. The amount you'll pay depends on many variables including: where you live, the age, type, size of your home. For example, older homes can cost more to insure due to the fact that they may require more repairs than newer homes. Also, high-hazard areas can cost more to insure and some insurance companies may not offer an insurance policy for your home, if you're in a high-risk area.
When Budgeting for a New Home: Include Utilities and appliances
When you own your own home, be sure to consider expenses such as the water heater or dishwasher breaking down. While, you can't exactly figure out when an appliance is going to quit working, you can set a monthly allowance aside to start establishing a household repair fund. Just don't touch the account or when you really need it, you'll find it's not there for you.
When Budgeting for a New Home: Include Inspections, appraisals, and closing costs
Many buyers understand they will have closing costs but they fail to budget for other items such as a home inspection. Sometimes inspections are paid for by the seller but it's usually the buyer who pays for the inspection. And, even if the homeowner recently had a home inspection and has the report, a buyer still might want to pay for an inspector to have another look to compare the findings.
Depending on the home, there may also be other inspections such as for lead paint, pests or radon gas.
While the extra expenses do add up quickly, if you carefully budget and plan ahead, the goal of homeownership is achievable and very satisfying.
Call me and I'll help you prepare an estimated budget for that new home!
Harrisburg PA Real Estate Expert
Ken Huebsch: Your premier real estate agent in the Greater Harrisburg area. I am a specialist in Harrisburg real estate as well as the communities of Palmyra, Hershey, and Hummelstown. My wife Leslye and I have a combined 40+ years' experience serving our clients -We KNOW Harrisburg. When you plan to buy or sell Harrisburg area real estate, allow us to work for you. We are dedicated professionals and are here for your success.
For more information on how we can best serve your real estate needs, please complete our online contact form or give us a call. Also, check out what our fabulous clients have to say about us on our testimonials page!
Cell: (717) 514-1793 Email: Ken@KensHomesales.com
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