When you’re considering what type of home to purchase as a first time home buyer, understanding the total maintenance costs may be a key factor in your decision making process.
Some homes are imposed with special fees such as neighborhood association fees and even additional taxes depending on the town or city government. These fees must be factored in when buying any home especially if you are working on a budget. I’ll enumerate the basic fees bundled with some common types of homes.
Condominiums: An increasingly popular choice for first-time homebuyers, living in a condo means you have access to shared living spaces and amenities. As a result, you’ll be responsible for paying association fees and maintenance fees that are based on a percentage of ownership of the building.
Ilyce Glink, who is the author of the book ‘100 Questions Every First-Time Home Buyer Should Ask’ says that each owner must pay maintenance fee equal to his total share of ownership in the condominium. This is calculated by first getting the total expenses in operating the building and dividing this to an owner’s percentage of ownership. The total expenses of a building may include a reserve account used for emergencies and this may vary anytime.
Townhouses: The maintenance fees of a townhouse will not go beyond what you would expect of a regular, exclusively owned home. But some townhouses are part of a neighborhood or homeowner’s association. Being part of an association requires an owner to pay monthly association fees for the overall maintenance expense of the association including taking care of common yards and shared areas.
Mobile Homes and Pre-Fabricated Homes: Mobile home owners and pre-fabricated homeowners are usually responsible for all fees involved with maintaining and operating their home. This includes the cost of sewage, water, cable and other utilities. However, some mobile home sites do charge additional fees for renting the land, and every park has its own rules, regulations and requirements.
Single-family detached homes: Owners of single-family houses are the only ones responsible for their houses’ operating and maintenance costs. Homeowners are still responsible for their own expenses even if they live inside a community setting. Typical maintenance costs come from yard upkeep, house repairs, water, and other utilities.
Ascertain the total maintenance costs from a Realtor first before approaching any loan company or officer. Lenders may at times include maintenance fees and other costs in your loan package. Give all the information you got from your Realtor to your loan officer and inform him/her of your budget to acquire a loan that will fit your needs.
Any house, whether it is a single-family home, a condo or a mobile home, has several implicit ownership and maintenance costs. It is better to know more about these costs while you are still searching rather than be surprised by every fee you have to pay after you bought the house. Compare the total costs for each house you are interested in next to each other by using simple spreadsheets or checklists. In this way, you are making an informed choice that you are less likely to regret.
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