These Are the Hidden Costs of Buying a House

The housing marketlooks like hellfor the foreseeable future.

Some of these costs arent exactly hidden but theyarecommonly overlooked.

Especially if youre a first-time buyer, it helps to know what youre getting into.

Lets take a look at them in detail.

Home inspections

You put an offer on a home, and it got accepted.

From here, inspections will be your first major expense.

Yes, there may be more than one inspection.

Before you officially close on your house, youll want to schedule a thorough inspection.

In fact, your lender will probably even require one.

You already have a report, after all.

However, its always a good idea to get your own inspection anyway.

Its a big purchase, so its better to err on the side of caution.

Plus, you want to be around during the inspection to see things for yourself.

In some cases, lenders require survey costs, too.

At this point, they should give you a detailed list of what your closing costs are.

So if youre buying a $200,000 home, expect to spend between $4,000 and $10,000.

Appraisal: The home appraisal can be a big expense, at several hundred dollars.

The lender wants to double-check the home appraises for the sale price.

We explain what the current 7% mortgage ratemeans for your monthly payments here.

you could find out how much the current rate will impact your monthly payments with an onlinemortgage calculator.

If you dont have an escrow account, youll just pay them on your own directly when theyre due.

However and whatever you pay, verify to budget for this ongoing, recurring cost.

As a homeowner, it hurts a little more because you have to pay for for the repair yourself.

For a $200,000 home, four percent is $8,000.

Elbow room is great, but it also means your bills will be a little higher.

It might be a long shot, but its probably the easiest way to see how much youll pay.

Buying a home is traditionally thought to be a smarter financial decision than renting.

However, all of these extra costs add up.

Still, even with these costs, buying is a better long-term financial decision than renting in many areas.

You want to crunch the numbers yourself, considering all of these unexpected costs.

(TheNew York Timesrent vs. buy calculatoris probably the best tool weve seen for crunching these numbers.)

Factor in these expenses, and you should be on track.

Andmake sure youre avoiding these common money mistakeswhen buying a home.