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Don't Forget to Budget for Expenses After You Close on Your New House!

Hooray! You've decided to buy a home, you've sat down with your loan officer and you are ready to close on the American Dream! Your mortgage and closing costs are the first things you think about but don't forget the following:

Moving Costs

Movers are very busy these days so book early and avoid paying higher prices for an "emergency" service. Other factors that effect your moving costs; the distance you’re moving, the amount of furniture and personal belongings you own, packing, unpacking, location (stairs, hills, parking etc) and temporary storage. Some tips to reduce costs: 1. Pack your own belongings. 2. Label everything well 3. Get rid of things you don't need BEFORE you move them! 4. Be ready when the movers arrive!

Updates and Upgrades

You may have a variety of major or minor repairs and improvements to make to your new home. These may be based on the home inspection or on your personal preferences. In either case, you’ll probably save some time and frustration by having them done before you move in but be realistic and have a plan.

Cost of Living Increases

Things to consider about your new home. 1. Longer commute=higher transportation costs. 2. Limited access to grocery stores and big box stores = higher prices 3. School options for the kids - public or private? 4. Cost of labor and material costs in your new location. The Monterey Peninsula typically has higher labor and material costs than Bay Area and Central Valley. The Pandemic has also impacted construction costs over the past year and a half so do your homework.

Property Tax and Homeowners Insurance

If you’re moving to a more expensive area or upgrading to a significantly larger home, you will probably find that your property taxes increase as well. Homeowners insurance may become more expensive too. Fire insurance is a hot button right now and some high fire zone premiums may shock you. Due diligence before purchase is essential.

HOA Fees

If you’re moving into a homeowners association, your monthly, quarterly or annual fees need to be considered. These HOA fees (or condo fees, in the case of a condominium purchase) fund the upkeep of common areas and amenities. Don't forget, dues can go up annually so keep that in mind.

Utility Costs

Utilities can vary significantly depending on location, size of your home and your amenities. In Monterey County, water is a scarce resource and bills are based on consumption. Moving from a home with few special features to one with more, including upgraded appliances, multi-zone HVAC, pool, spa can effect your bills. You may want to consider some energy efficiency upgrades to help cut monthly bills including adding insulation, replacing old doors and windows, or replacing outdated appliances and systems with new ones.

Outdoor Maintenance Costs

Owning a home comes with some responsibilities and maintenance is the biggest one. Aside from labor and equipment for regular lawn maintenance, you’ll need to think about other landscaping tasks and tree maintenance. You’ll also need to maintain the roof, clean the gutters, maintain exterior trim and siding, and keep up with your hardscaping, deck, and stonework.

Source: American Lifestyle Magazine


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