When it comes to purchasing a new home, there are a lot of expenses that may surprise you. While it seems like you’d just need to focus on applying for a loan and getting approved, then making your offer and coming to an agreement on a property, there are several hidden costs that you may run into during the buying process and throughout the move. Homeownership is more than a few quick signatures on a contract. So, what exactly should you expect?
Be Prepared for Closing Costs
One of the most overlooked expenses home buyers come across is the cost of closing on a property. Closing costs can include various fees, such as appraisal fees, attorney fees, title insurance, and loan origination fees. These costs can add up quickly, and they typically range from 2-5% of the home’s purchase price. This makes it essential to factor into your budget when you make an offer on a home. While you can ask for the sellers to pay all or part of your closing fees, most of the time it’s up to the buyer to cover those expenses.
Neighborhoods with HOA Fees
This isn’t a fee you’ll have to budget for in every scenario, and many neighborhoods in areas like Toccoa, GA don’t have these fees, but it’s important to do your due diligence on an area before you make an offer.
Homeowners Association Fees, otherwise known as HOA fees, are an expense that frequently catches buyers off guard. Some residential communities have HOAs that charge monthly or annually to cover the maintenance of common areas. This is most often seen in neighborhoods that offer things like community pools or gyms, and sometimes even various forms of landscaping and basic care. Before making an offer on a place, always research and fully read the HOA fees associated to help avoid any potential surprises.
Consider Short-Term Utility Transfers and Long-Term Utility Expenses
Another hidden cost to consider when buying a new home is the cost of utilities. While the monthly mortgage payment may be within your budget, the cost of electricity, gas, water, and other utilities should not be underestimated. The specific costs will depend on factors such as the size of the home, the number of occupants, and location, as well as the time of year and things like how frequently you’re home to use these utilities. One of the best ways to gauge what you can afford and expect to pay is by researching average utility costs in the area or even contacting the local utility providers for estimated quotes.
Necessary Renovations and Upgrades
One final hidden fee that buyers often forget to calculate into expenses is potential home renovations or much-needed upgrades It is crucial to consider the potential costs of renovations or upgrades to the home before you put in that offer. While you may be satisfied with the condition of the property at the time of purchase, there might be future projects or improvements you want to undertake. Whether it is updating the kitchen, remodeling bathrooms, or replacing flooring, these costs can quickly add up. It is prudent to create a separate budget for these future projects to avoid any financial strain. This is also a great way to help you weigh the pros and cons of a home that meets most of your needs but isn’t quite checking all the boxes without undergoing a little TLC.
At the end of the day, buying a new home in or around Toccoa, GA is an exciting experience. It can be a life-changing decision, which is why it’s important to do your research and consider things like hidden expenses. By creating a budget and doing things like working with a local real estate agent, you can avoid falling into the trap of getting behind on bills or draining your savings account.