Nationwide, home prices are rising. High demand and record-low supply are driving up costs. When deciding on a budget for a home purchase, it’s crucial to keep in mind that there are additional expenses above and beyond the asking price.
Here are some important expenses to think about while you shop for a home. However, you can be confident that your Berkshire Hathaway HomeServices will support you at every turn. Call us at (310) 373-0021 to learn more.
A home inspection
When buying a home, home inspections are a fantastic resource for you. Once you have a contract, you want to ensure that your dream house is everything you had imagined it would be. You can find out if there are any little issues that you can’t see with your own eyes by hiring a home inspection.
A comprehensive home inspection can reveal existing and upcoming issues or, even better, can offer the house a clean bill of health. However, it isn’t free. HomeAdvisor’s True Cost Guide estimates that the average home inspection costs $323, while actual costs may vary by market.
Some inspections, like termite and radon checks, are not typically included in your baseline inspection price. Some purchasers even opt to employ experts, such as an arborist, to evaluate the condition of your trees.
Simply because a problem was noted during your inspection does not obligate the seller to address it before to closing. After receiving your inspection report, it is ultimately up to you to decide what has to be fixed, but we have seen it all and can offer advice.
Added closing expenses
Simply put, closing expenses are the sum you pay to all the parties involved in making your property purchase a reality. According to Felipe Chacon, a housing economist, closing costs, which can include agency fees, inspector fees, or flood zone insurance, can build up over the home-buying process. There are also other expenses that you don’t consider, he continues.
Closing costs also include a variety of fees, including, but not limited to, appraisal, credit report, title insurance, and government recording fees. In order to avoid any surprises, buyers receive a sheet that breaks out all the charges. However, when added together, they often amount to an extra 2% to 5% of the home’s purchase price.
Real estate tax
You must contribute to your new municipality’s tax pool as soon as you move into your new home. So that the buyer doesn’t have to worry about paying a separate fee each quarter, property taxes are frequently incorporated to the mortgage. But keep in mind that property taxes aren’t a constant expense, they fluctuate more frequently than not, and even if you pay off your mortgage, you’ll still be responsible for those taxes.
If taxes seem excessive, you can inquire as to whether they have been challenged or revalued in the hopes that they will be lowered. You can get in touch with the tax office in your municipality to learn more.