Hey. Let us tell you a story. There was a couple who weren't doing well financially but had big dreams. To save money and buy their own house. After years of savings and financial management, they realized their dream and purchased a home.

They thought their homeowner responsibilities had ended. What they didn't know what that it was only the beginning. Over time, the couple realized that there were many homeowner expenses they had to deal with.

These additional financial responsibilities were not something the couple had accounted for. Why? Because that couple didn't read this blog where we highlight the homeowner expenses that came with buying a home.

That's not a situation you'd want to experience, right? So start your home-buying journey the right way by knowing the potential homeowner's responsibilities, along with the expenses that come with it.

That's exactly what we'll know in this blog. Without further ado, let's begin.

Initial Expenses

These are the one-time expenses that you usually pay at the time or soon after you buy your home.

Closing Costs

There's a lot that goes into finalizing a property deal. You often have a real estate agent who is the middleman to negotiate the deal and take care of extensive formalities.

Here are some activities of a real estate agent during the property dealing process:

• Prepare and review all necessary documents
• Coordinate between individuals involved in the process
• Ensure all transactions take place in a timely manner
• Resolve any complications that arise before the deal closes
• Finalize the property sale

It's a common saying, "There's no such thing as a free lunch." The services of the real estate agent come at a cost, which is among your first of many homeowner responsibilities.

This expense is also called the closing cost, which usually ranges from 1% to 5% of the home purchase price. You may see the percentage increasing if the purchase is low.

Down Payment

When you're buying a house on a mortgage, you need to win the trust of the lender and assure you won't default on the loan. One way to create an understanding with the lender is to pay a down payment.

This is a smart financial decision as it can help you save a lot of money, and build the home equity faster. In addition to these two benefits, a down payment can also reduce the monthly mortgage payments and help you negotiate favorable interest rates.

So, by bearing the homeowner expense of the down payment, you can significantly cut down on the expenses.

Recurring Expenses

After you've paid the one-time homeowner expenses, let's look at some of the periodic expenses you'll need to pay

Mortgage Payment

Buying your house on a mortgage gives you access to a loan that you can pay back in the decided time, with interest. This is one of the major homeowner responsibilities and a significant expense they have to deal with regularly.

The mortgage amount is fixed, that's often paid back within 15 to 30 years. Generally, the mortgage payment is a monthly homeowner expense.

Not that you'd be doing it, but just for the sake of clarity, let's assume you miss a mortgage payment. You'd want to know the consequences, right? Typically, missing a mortgage payment might result in a late fee, which may damage your credit score.

Explore: Calculate Your Monthly Mortgage

Property Tax

When your mortgage payment is a monthly expense, the property tax is generally a yearly homeowner expense. Property tax is a government-imposed homeowner responsibility, that's calculated by assessing your property value.

You'll be right in asking the question, "But why do we need to pay the Property Tax?" We have the answer for you. The property tax is the homeowner's responsibility, which includes different taxes like local income and state tax.

A pleasant surprise

You might not have to pay the entire property tax. Yes, you've heard that right. As we've talked about in our previous blog for tax deduction, you can deduct a considerable amount if you file as a bachelor, or file separately being a married couple.

To learn more about the property and other tax exemptions, check out "The Financial Benefits of Tax Deductions for Homeownership"

Back after reading that blog? Good.

Let's now talk about the worst-case scenario - what will happen if you don't pay your property tax? There might be a tax lien placed on your property by the government, leading to foreclosure.

Homeowners Insurance

Trouble doesn't come knocking. So it's important to be proactive. That means, it's an important homeowner's responsibility to have home insurance coverage.

It even makes more sense to have reliable insurance coverage if you've bought the house on a mortgage. So, if next time (gob forbids) there's an unexpected natural disaster like a fire breakout, flood, earthquake, or something else, you won't suffer a significant financial loss.

Generally, insurance is a monthly homeowner expense, so you'll need to manage your expenses accordingly.

Explore: Hiring Qualified Insurance Agents is a Click Away

Maintenance and Repairs

This is one of the homeowner expenses where the renters have an advantage. When you're renting a property, the landlord handles all the property maintenance expenses. But when you buy a property, your homeowner's responsibilities include bearing the cost of repairs required around your home.

These may include routine maintenance like gutter cleaning, air filter changing, or front lawn maintenance. In addition, there might be occasional maintenance where you want to call the plumber for leaky pipes, and an electrician to look after wiring issues.

It's generally considered that 1% of a home's purchase price need is your yearly budget for maintenance and repairs

Explore: Hire Experienced Home Inspectors Today

Utilities

No, the recurring expenses don't here. Yes, you'll for home maintenance, insurance, taxes, and mortgages, but what about the utilities? For a smooth living, you'll need internet, electricity, gas, and more. These are just a few of the amenities you need to account for when making your homeowner expenses list.

In most areas, facilities like water, sewerage, and garbage collection are included in the rental properties. You might also want to account for these facilities, which would mean extending your budget.

Additional Homeowner Responsibilities

Finally, if you're looking to improve living quality and comfort, here are some homeowner expenses you might consider.

Renovation

We've talked about home maintenance as a recurring expense because it's a necessity. Renovation is more about improving your home's quality to make it more livable. This includes making your house more comfortable by upgrading your bathrooms and adding new facilities to your kitchen.

As a homeowner responsibility, it's important to keep updating the feel of your home for yourself and the people around you.

Landscaping

You enter your home and get that pleasant feel to reduce the stress build up during a tiring day. A way to realize this feeling is by upgrading your outdoors. You can plant trees, add flower beds, and install shrubs.

Once your gardener is done making these changes, you can reduce the maintenance by taking up homeowner responsibilities yourself. These are things like mowing the lawn and watering the plants. It will considerably lower your landscaping cost.

Security

One of your major reasons to buy a home would be to ensure your family's safety and have 100% privacy, right? Well, there are places around the United States where you might not be secure. That's why we recommend investing in a foolproof security system to help you deal with these thieves.

The security systems include things like security cameras and smart locks. Once you have security in place, you'll have fulfilled your homeowner's responsibility to protect your family and home assets.

Entertainment

A home is a place where one comes to relax and enjoy every moment. Sometimes, landscaping and renovation might not be enough to get the experience you're looking for. This calls for you to up your homeowner expenses and invest in installing an entertainment system.

Here are some home entertainment ideas for you to think about

• Home theatres
• Gaming rooms
• Outdoor Barbeque

Fulfill your homeowner responsibility by first identifying your preferences and setting a budget accordingly.

Office

Post the COVID-19 pandemic, the work-from-home culture has become a common trend. If you decide to use your home as a workplace, you'll have different expenses associated with it. To build a workplace, you'll be a table, chair, and other accessories to perform your professional activities.

Wait, there's something you'd want to know if you have a home office. You can avail of tax deductions. The portion you use as your home office will not be considered in your taxable income.

For example, if you have a 2000-square-foot home, and 500 square feet are dedicated to your home office, you can get a 25% tax deduction. When you talk about eligibility, you can only avail the deduction if you're self-employed, or a small business owner.

The Final Word

These were the expenses that the couple (we mentioned above) didn't know about. Now that you're aware of your homeowner responsibilities and expenses, the next thing to do is find a home to buy.

HAR can help you in your journey to buy a home and help you improve your life quality.