Home Buying 101: Five Hidden Costs of Home Ownership


“People who own property feel a sense of ownership in their future and their society. They study, save, work, and strive. And people trapped in a culture of tenancy do not” –Henry Louis Gates


Home ownership has long been considered a keystone of financial stability as well as responsibility. It is a keystone of wealth—both financial affluence and emotional security—at least according to Suze Orman.

In this regard, it has been the lifelong dream of many to finally afford a home of their own and build the right kind of house for their families. After all, there is just that feeling of security in owning a home that is not quite found in tenancy. However, while finally owning a home might sound like a blissful dream, it is still a responsibility, albeit a pecuniary one. Home ownership requires meticulous forethought as regards your expenses and being responsible enough to budget for them. Unfortunately, many newbie homeowners think that the worst of their spending days is over once they have finally settled in the home and defrayed the initial cost. However, regardless of whether you are owning simply a “starter home” or the home of your dreams, a house can easily be a metaphorical money pit if you do not take into account the hidden costs of home ownership beforehand.

Yes, a home may seriously look like a great deal when comparing the costs of monthly rentals to the base purchase of buying your own home. However, know that your expenses would make up of so much more than just the base purchase price of your home. In reality, things such as the financial burden of maintenance and repairs would be on your shoulders whereas in tenancy, this would be the responsibility of your landlord. Buying a home is already expensive in the initial phase, but what you have to consider is that the spending has just begun. This is not to say however, that the only option you have for the rest of your life is to rent. However, before you go and browse housing brochures for a condo unit on Park Central Towers or elsewhere, it might be wise to at least have an idea of what your prospective expenses will be.   In this regard, you would be able to weigh your options, and gauge what you would be able to afford before you even start picking out paint colors.

Here are some of the nine hidden costs of home ownership:


Homeowner’s association fees

One of the rookie mistakes first-time homebuyers make is to fall for homes with attractive low prices only to find out that they would need to pay exorbitant Homeowner’s Association Fees. If you are looking for an affordable property, it is important to take into account the HOA fees which would cost anywhere from five thousand pesos a month to nearly as much as what you would pay for a condo unit’s down payment. Unfortunately, these are not elective fees you can simply choose to forgo. Before signing and finalizing the contract, check or have your agent check on the bylaws that would dictate how these fees can be raised.

Repairs large and small

Over the years, ordinary home and wear and tear would be inevitable. Unfortunately, while small repairs such as these would not likely deplete your monthly budge, significant repairs will. There are some home repairs you cannot plan for such as the ones that would occur after a fortuitous event like the damage brought about by natural calamities. You might be surprised but a roof repair can easily set you back by tens of thousands if you are not careful. Even without a natural calamity, your home could be riddled with potential repairs that would include anything ranging from plumbing mishaps to correcting a poor roof design.

Simple maintenance

No matter how much you try to plan and prepare for the renovation and maintenance costs consequently brought about by home ownership, you can never fully (or even adequately) prepare for it.  Maintenance can mean a range of things from small and big repairs to having your gutters cleaned annually and the like. These things might seem like small and insignificant expenses, but they can easily accrue which means you have to seriously consider them as well.


There is a saying that goes that if you cannot afford insurance, then you cannot afford a home. This could not be even truer today. If you wish to protect a significant investment such as your home, availing of a home insurance would be a wise move. Moreover, if you are going to be loaning the money, then you should know that most lenders would require this. Unfortunately, home insurance can be quite costly. Home insurance would depend on a myriad of factors which would include the location of your home, the type of materials used and how much coverage you want. Hoem insurance typically costs more than renter’s insurance. This is because you are effectively paying for the assurance and security in rebuilding your home (and replacing your personal possessions) should anything happen to it—whether it would be razed by fire or crumbled into rubble by earthquake.

Utility Bills

Utility bills can easily accumulate and if you are not careful, you may find yourself paying a an exorbitant premium each month for them. Depending on where you live, what you spend for electricity, water and gas could be significantly higher than what you spent before. While those are the essentials, know that you might potentially have to spend for Internet connection costs, cable and phone bills as well as pay for the garbage to be collected.



While owning a home potentially opens you up to a variety and a myriad of prospective expenses, know that these can be easily mitigated if you adequately planned for it. Sure, it might cost you more than you initially thought but an investment in property can still be worthwhile. Just be sure to select the property you can afford and budget for all the expected and unexpected expenses.

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