- Levies pass and taxes go up. My school levy failed but my taxes still went up approximately $20 a month which is over 2%. My taxes would have been in the 4-5% if the levy had passed. Plan on an increase equal to inflation if you are in a good area. 3% over 10 years is an 34.3% increase.
- Costs money to buy and sell your home. Expect to get hit for about 2-4% going in and about 6-7% going out. (That’s 8 to 11% folks)
Conclusion: I wish I could give you a more concrete number, but its just not possible. I can tell you that my home is at least $2,000 a month outside of my mortgage, tax, and insurance payment. I would guess it is more like $2,500 a year (about $200 a month). I also like to think that I keep a very nice home.
I personally have come to this conclusion – Owning is expensive. Now if I compared renting the same type of house – it might not look so bad. It might be about even (around $1200), but here is the thing – if I rented I wouldn’t need 3 bedroom or even 2 bathrooms. I would most likely rent a much cheaper place ($800 – $900 a month). $300 or $400 a month is a big difference.
I think the solution is this – if you are sure that home ownership is in your future – Buy the cheapest and smallest you can in the area you want. I bought relatively cheap, but even now I wish I could have even less. I recently wrote about looking at a condo that would have been in the $400 a month range to own all-in, and I could see why it would be tempting if you knew you were going to be in that location for 3+ years.
At the end of it all – I’m a young homeowner telling you, be 100% sure you want to stay in the area and buy less and thrive. There is also a lot of reasons why to be a renter.