My husband and I spent many years on and off home hunting while we lived in a condo. We looking in more than five cities and towns before we found a house, and bid over asking. After 18 months in my first property — a single family home in the suburbs– I am sharing the five property features that can ruin your home budget.
- Long Driveway – Snow plows services are not cheap. Are you going to snow blow a driveway that is six car lengths, before the kids wake up and you get ready for work? Is that in your budget? At this point in your life, which is more precious — TIME or MONEY?
- Big Yard & Wooded Areas – Landscapers are not cheap.
- Does your budget include regular cuts from April to October, including the dreaded “fall cleanup?”
- Do you have a budget for pest control? If not, are you prepared to check your kids for ticks every day from April to October?
- High Ceilings & Drafty Walls — Poor insulation in a large home means more heating costs, which are market and event driven. If you don’t have natural gas, you need to use oil or electric. That means your winter heating bills could exceed your summer landscaping and pest control bills — AND you need to budget for that. You can also augment with space heaters and fireplaces but you need accessories for those and to ensure they are safe (aka not going to cause a fire.) Remember, unless you have an alarm service with a direct line to the fire station, your smoke detectors and CO2 detectors only sound to alert you. The homeowner needs to call for emergency help.
- Elite School Districts — Rebuild prices are high in wealthy areas, which impacts home insurance rates. Good school districts are often associated with high property taxes. That means your mortgage bill, assuming it includes escrow payments for home/hazard insurance and real estate taxes, is going to be a lot higher than you expect. Check out mortgage calculators and include home insurance and local property taxes. You can find each city’s real estate tax rate on the city/town website (fee / $1000 of property value.)
- Telecom Options — Are you looking in areas with poor cellular service? We get very few bars on our cell phones so cell calls usually switch to WiFi calling. Sometimes we need to take the call on a landline. We also have few options for cable TV and internet. That means we are stuck with the triple play, which is all rendered useless when the power goes out. That means instead of cutting the cord and keeping only Internet for $50/month, we pay close to 3X that. We could have saved another $1200/year if we just got Internet from the start.
When you look for a home, especially if you are seeking a single- or multi-family home, consider insurance, pest, snow, lawn care, and heating and cooling costs. All of these eat into your budget, which means less for investments (read: retirement and 529). See my Sinking Funds post here!