HomePersonal FinanceCosts to Remember When Looking Into a New House

Costs to Remember When Looking Into a New House

This is a Guest Post from Paula Pant, the blogger at If you like it — “Like” it on Facebook!  Paula Pant, teaches you to live richly + savor life. Check out her site, and follow her on Twitter @AffordAnything.

Now that Evan and his wife have heralded the arrival of Baby Boy – and the accompanying arrival of Grandparents Visiting All the Time – the couple is trying to find a place to live that’s large enough for the visiting Grandparents. This leads to the obvious question: how much will the mortgage be? Evan has written some great posts on this topic, so I think this is a good moment to have a brother conversation (pardon the pun): what other major costs of homeownership should they consider? Here are three big ones.

Transaction and Closing Costs

Buying and selling a home will cost you about 6 percent of the home’s value in Realtor fees. (The actual amount will vary based on your location – each state has its own Realtor’s association with fee guidelines). A vociferous debate rages on the Internet about who pays this fee. Some argue that the seller, technically, pays it, while others retort that the buyer pays it through higher home prices. Regardless, we can all agree that in the process of buying and selling a home, you can kiss roughly 6 percent goodbye. If you sell a $275,000 home and buy a $350,000 home – paying 3 percent on each transaction — you’ve paid $8,250 on the sale plus $10,500 on the purchase, for a total cost of $18,750. Yikes!


I used to think “needing tools” for a home was just a convenient excuse for DeWalt-loving men to justify their power tool splurges … until I bought a home. Suddenly, I needed all kinds of tools. Like a chainsaw. There’s an ugly tree in the front yard that’s creeping close to some electrical lines. I live in Atlanta, which suffers from high winds and the occasional tornado. Branches close to electrical lines are a bad idea here. I could hire someone to trim the branches – but I called around for quotes and heard astronomical prices. I could do it myself (well, I could ask my boyfriend to do it) … but I need a chainsaw. Also, I need a place to STORE the chainsaw. I live in a thriving urban area near downtown, which means no one on my block has a garage. Do I build a little toolshed in the tiny scrap of land that’s posing as the so-called “yard”? And if so, how do I keep thieves out of the toolshed? A pre-assembled shed at Home Depot starts at a thousand bucks. And an alarm system for the shed … well, that sounds ridiculous. But in this neighborhood, it’s necessary. Also: my house needs a bath. It’s next to a busy road, which means years and years of car exhaust have deposited a solid layer of filth on its exterior. (Yeah, I bought a REAL fixer-upper.) I’m going to have to pressure wash my house. And since I’m so close to a busy road, this pressure washing will probably be an annual event. Which means I need a pressure washer – and that’s going to cost me a few hundred bucks. Plus, where will I store it?

The “Bigger” Tax

Moving up to a larger house – more square footage, more bedrooms – imposes what I call the “bigger” tax. On the surface, this is literally a bigger tax: your property taxes will likely rise as your square footage rises (of course, this also depends on your neighborhood and school district). Regardless of your school district, there are big costs of maintaining big spaces: you’ll need to furnish all the rooms. Your electricity and gas bills will probably rise. You’ll have to repair more breakable components: more ventilation, more plumbing, more windows that some kid (maybe your own kid) can shatter with a baseball. You can stem some of these risks, of course. Insulating your home can reduce your utility costs – but insulating a large home costs more. You’ll need more spray-foam. You’ll need to lay more fiberglass in the attic. If you put solar panels on your roof – well, your electricity demands are higher, so you’ll need to buy more panels.

Of course, at the end of the day you have the weigh the costs against your quality of life. But from purely a financial perspective: it might not be a bad investment to get Grandma and Grandpa a cheap motel room down the block when they visit. Then again, Evan, you live in New York, where there are no cheap motels. So nevermind. You’re on your own with this one!



  1. All these things and more! Don’t forget homeowner’s insurance. Home ownership is no easy task, but everyone wants one some day. This may be the biggest financial transaction in someone’s life and they prepare much more for it. Maybe we can avoid another financial crisis.

  2. I think many people ignore the “bigger tax.” I know people who purchases big homes and then have to buy so many things to fill it up. That’s why we like our small condo. 🙂

  3. i second those thoughts. everything, from water bill, lawn care, electricity etc goes up with a bigger place.

  4. “Time” is the other cost of ownership. In renting, if anything breaks down it’s the landlord’s responsibility. In your own house, it’s yours, and it’s either plunking down for a repair job, or spending the time (and tools) to fix it.

    • You’re right, time is a HUGE factor! My boyfriend’s job sent him to New Jersey for the entire month of April. The night before he left, when he should have been packing and enjoying his last night in town before heading out of state, he was fixing a sudden plumbing emergency. It’s quite a time cost to having a house!


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