- People are spending more and more of their paychecks on mortgages.
- Some other factors could cost them a lot more in the long run if not factored in.
- Two of the biggest hidden costs are maintenance and skyrocketing insurance rates.
Home prices and mortgage rates in the US are still high, so much so that some people can’t purchase a place of their own. And many people may not be budgeting for the additional costs of homeownership, such as repairs.
A survey of 1,000 US homeowners published in October by OnePoll and Honey Homes, a service that connects homeowners with workers who can assist with maintenance and upkeep, found that the average respondent spends $9,924 annually on upkeep, repairs, and maintenance.
“Due to high real estate prices and interest rates, current homeowners are hesitant to purchase a new home and become saddled with a bigger mortgage,” Honey Homes founder and CEO Vishwas Prabhakara said in the report. “At the same time, for many, improving or just maintaining their current home continues to be a challenge.”
Of the homeowners surveyed who said they are more likely to look for a new home than upgrade their current residence, 74% cited improvement costs.
But it’s not as simple as setting aside $10,000 a year. While that might cover the average, some higher-end repairs can bring the total well over the norm.
Did your air conditioning unit quit? A new one will set you back at least $4,000. Have a two-story house? You might have to double that.
Need a new roof? That’s a minimum of $6,000.
Is the foundation uneven or cracked? That’s anywhere from $2,000 to $8,000 to fix.
Want to replace that old garage door that wakes up half the neighborhood? That’s another $1,000.
To be sure, sometimes damage to a house is covered by home insurance. However, the cost of that coverage is skyrocketing in many parts of the country due to the rising prices of weather-related damage from things like hurricanes and tornados.
In Florida, home insurance rates have quadrupled since 2019. In some cases, companies have stopped offering new policies in areas with more extreme weather.
Other states are also getting battered. In Texas, residents get hit by hurricanes, tornados, and devastating hail storms and are now in “an insurance crisis.”
Of course, one way to offset the cost of maintenance and upkeep is for the homeowner to do it themselves. However, even if the project is something they can successfully accomplish, there are still the added costs of tools, supplies, and even the owner’s own time.
Alice J. Roden started working for Trending Insurance News at the end of 2021. Alice grew up in Salt Lake City, UT. A writer with a vast insurance industry background Alice has help with several of the biggest insurance companies. Before joining Trending Insurance News, Alice briefly worked as a freelance journalist for several radio stations. She covers home, renters and other property insurance stories.