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When is the bottom line not the bottom line? When it fails to account for all the day-to-day expenses that come with homeownership, beyond mortgage payments.
Those costs can be sizeable, according to a new report from Zillow and Thumbtack. It calculates that the “hidden costs” of owning a home total $15,979 per year, including maintenance, insurance, and property taxes. They can even rise faster than household income.
As calculated, the average homeowner pays $3,030 in property taxes, $2,003 in homeowners’ insurance, and $10,946 in maintenance costs, in addition to their mortgage. These numbers total excess expenses of more than $1,300 a month – a cost increase of 4.7% compared to a mere 3.8% increase in household income.
The figures are based on Thumbtack’s data on the annual cost of home maintenance. It includes projects like heating and cooling system maintenance, roof repair, lawn care, gutter cleaning, and tree trimming.
Homeowners in coastal markets have it even worse, according to the report. The sum of hidden costs may amount to $24,381 a year in New York City, $22,781 in San Francisco, $21,380 in Boston, $21,175 in Seattle, and $19.959 in Miami.
Another expense that keeps rising is homeowners' insurance. “Nationwide, average premiums have increased 48% since early 2020 and now total just over $2,000 a year,” the report noted, but here again, premiums have risen even more in other cities. In Miami, premiums soared 72% to an average of $4,607 a year. There have been similar leaps in other Florida cities, such as Jacksonville (up 72%), Tampa (up 69%), and Orlando (up 68%).
Cities in other states have seen similar patterns, like New Orleans (up 79%), Sacramento (up 59%), Atlanta (up 58%) and Riverside, CA (up 56%).
“Understanding these hidden costs is critical for anyone planning to buy or keep a home,” the report noted.
This article originally appeared on GlobeSt and may not be reprinted.
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