Buying your first home is a fantastic thing! It’s more than having a home. It’s also an asset! But there are extra costs in addition to putting down a deposit and making regular mortgage payments that you need to consider.
Now you’re going to be smacked with the bills.
In this article, you’ll learn about seven extra costs associated with owning your home.
Your asset will need upkeep. The grass will grow, the paint will peel-off and the floors will show wear and tear. There is also the odd issue with pests and any old wiring, faulty plumbing and tired fences. You can either maintain it yourself or pay professionals to do it.
Having a cash buffer is a good idea for any surprises. A rule of thumb for calculating the cost of maintenance is 1 per cent of the value of your property per year.
Some home loan accounts have fees attached. They are charged monthly similar to a transaction account, or annually.
Insuring your new home against damage is imperative to protect your asset. Your lender may also require proof of insurance to ensure their investment in your property is covered should anything unexpected happen.
Home and contents insurance will make any unexpected disaster less painful. It should cover the cost of repairs or replacing your property and belongings should something go wrong. It’s highly recommended that home-owners speak with an insurance broker to ensure they have got the best coverage.
Local council rates cover the cost of rubbish collection and road maintenance in your neighbourhood.
Apartments and townhouses have a body corporate fee to pay for maintenance and insurance of the communal pool and facilities.
This includes gas, electric and water bills.
Legislation across the country requires home-owners to adequately address safety hazards. Hazards include gas leaks, rotting decks, slip hazards, handrail compliance and glass hazards. Landlords have an obligation to provide a safe environment for people to live in.
What happens if you die without having made a will. This means your home could go to someone you don’t like. It has happened! Property inheritance can become complicated without a will in place. Especially if there are ex-partners and step-kids involved. So its recommended that you have a will done up so that your surviving spouse or kids will inherit everything by default.
The State Trustees website enables you to create a will online in as little as half an hour for a flat fee. For more complex issues, consult your solicitor or a professional will writer.