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The $9,000 tab that surprises homeowners

  • Commonly overlooked costs include utilities and maintenance.
  • Nearly 4 in 10 first-time buyers exceed their budget.

Homeownership might be more expensive than you expect.

Often-forgotten and underestimated costs of owning a home — from utility bills to yard care — add an average $9,080 per year to homeowners' tabs, according to a new analysis from real estate site Zillow and service site Thumbtack. (See a breakdown by major markets, below.)

Hidden costs can be especially dangerous given buyers' tendency to overspend. Nearly 4 in 10 first-time buyers exceed their budget, per Zillow.

"Determining how much a home will ultimately cost you each year and what you can afford is one of the most challenging aspects of home buying, especially for first-time buyers," Zillow's chief economist, Svenja Gudell, said in the announcement. "Before starting a home search, take a good look at your finances to determine a monthly payment range you can comfortably afford."

To avoid making a purchase you'll regret, make sure to include property taxes, insurance and utilities in your budget, said Kevin Meehan, a certified financial planner and regional president of Wealth Enhancement Group in Itasca, Illinois. (By Zillow's estimate, those three line items alone add more than $500 to the typical homeowner's monthly costs.)

"Without a doubt, those are real concerns because a lot of people focus solely on the principle and interest component," he said. "They sometimes lose the perspective on all those other costs."

Ask the seller to see copies of the property's recent utility bills — and not just the electric bill.

"If you've been renting, you probably never saw a water or sewer bill," said Keith Gumbinger, vice president at mortgage site HSH.com. "You might not have budgeted for that."

Anticipate future costs, too, Gumbinger said. Check to see if there's a property tax hike or revaluation going into effect, if the local utility providers have announced rate changes, or the condo or co-op board is proposing a maintenance fee increase.

Leave a buffer in your savings and budget for home maintenance costs. New homeowners tend to have a slew of unexpected expenses at the outset that can add up quickly, said Gumbinger — like realizing that now you need either a lawn mower or a lawn-care service to handle your yard.

"There's an upcycling of purchasing stuff for the house, that tends to be more than you'd expect," he said.

Build out your emergency fund to better handle unanticipated maintenance as it pops up, such as a furnace that needs repair, Meehan said. You might also set aside cash in anticipation of known upcoming expenses — say, if your home inspection notes the remaining life of your roof or water heater before they need replacing.

Hidden costs of homeownership in top markets

Metro
Estimated Median Home Value
Commonly overlooked costs*
Home maintenance costs*
Total hidden costs of homeownership
United States $199,200 $6,059 $3,021 $9,080
Los Angeles-Long Beach-Anaheim, CA $606,500 $9,622 $2,934 $12,556
Chicago, IL $210,200 $7,833 $2,589 $10,423
Dallas-Fort Worth, TX $209,200 $7,629 $2,082 $9,711
Philadelphia, PA $218,300 $8,117 $2,808 $10,925
Houston, TX $175,800 $7,189 $2,610 $9,799
Washington, DC $383,200 $8,764 $2,579 $11,342
Atlanta, GA $178,700 $6,896 $2,487 $9,383
Boston, MA $425,500 $10,807 $3,570 $14,377
San Francisco, CA $851,900 $13,019 $3,271 $16,290
Detroit, MI $140,900 $5,660 $2,485 $8,145
Riverside, CA $326,800 $7,576 $2,633 $10,209
Phoenix, AZ $235,100 $5,912 $2,455 $8,366
Seattle, WA $440,100 $8,872 $4,052 $12,924
Minneapolis-St Paul, MN $247,100 $6,178 $2,650 $8,828
San Diego, CA $543,400 $10,392 $3,096 $13,488
St. Louis, MO $148,700 $5,499 $2,288 $7,787
Baltimore, MD $260,400 $7,000 $2,591 $9,592
Denver, CO $368,200 $6,134 $2,318 $8,451
Pittsburgh, PA $136,900 $5,593 $3,079 $8,671
Portland, OR $363,800 $8,189 $3,674 $11,863
Charlotte, NC $173,200 $4,986 $2,415 $7,401
Sacramento, CA $366,500 $7,663 $2,406 $10,069
San Antonio, TX $160,400 $6,170 $1,962 $8,131
Cincinnati, OH $151,600 $5,570 $3,237 $8,807
Cleveland, OH $134,000 $6,282 $2,471 $8,753
Kansas City, MO $158,200 $5,778 $2,486 $8,264
Columbus, OH $161,900 $5,828 $2,425 $8,252
Indianapolis, IN $137,700 $4,699 $2,424 $7,123
Austin, TX $271,000 $9,465 $2,235 $11,700
Virginia Beach, VA $222,200 $5,915 $2,337 $8,253
SOURCE: Zillow and Thumbtack. *Commonly overlooked costs include property taxes, insurance and UtilityScore utility estimates; home maintenance costs include carpet, gutter and house cleaning, HVAC maintenance and yard care.