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Expected Homeownership Costs

To purchase a house you need the down payment for a financed purchase or the full amount for a cash purchase PLUS closing costs. But how much does it cost to actually own a house? Here is a list of some of the most common expenses…

Mortgage Payments: If you’re financing the house with a home loan – like most buyers – your monthly payment will vary based on the length of the loan, interest rate, and down payment. It will include the principle and interest along with any mortgage insurance which usually ranges from $100-300 dollars for purchases with less than 20% down. Your monthly payment has tons of variables so I won’t do an example, but we will review this in detail before looking at properties so you know a very accurate amount. 

Property Taxes: Property taxes in Las Vegas can vary depending on the specific location and assessed value of the property. A general rule of thumb I do is to do 1% of the sales price to get a conservative amount. 

Homeowners Insurance: Insurance is essential to protect your investment in case of damage to the property or its contents due to fire, theft, or natural disasters. A good ballpark amount I’ve seen is 3-4% of your monthly payment when financing. 

Utilities: they include electricity, water, gas, and sewer services. They will vary depending on the size of the house, energy efficiency, usage, and amenities. A fair ballpark for most would be a couple hundred dollars per month. 

Home Maintenance and Repairs:  Routine maintenance is essential to preserve the value of your home and prevent costly repairs in the future. Budget for expenses such as HVAC servicing, toilet and sink repairs, and other items. In real estate investing the general theory is the 1% Rule – maintenance will cost about 1% of the property’s overall value per year. In my experience this is a good estimate. I also strongly suggest getting a thorough home inspection done before buying and a home warranty after buying to minimize surprises. Both together for most they’re about $1,000.

Home Warranty: I highly recommend a home warranty when purchasing a home but you are not required to purchase one. It can cover the repair or replacement of major appliances and systems like heating, air conditioning, and the hot water heater. They cost on average about $600-800 per year and have the potential to save you thousands. I have dozens of clients that have these and they have saved them so much money – mainly from AC repairs in the Summer and a hot water heater replacements.   

HOA Fees: If your home is part of a homeowners association which is most homes here, you will pay either monthly or quarterly. It varies by location, property type, and amenities. On most condos it’s about $200 per month, a townhouses about $300 per month, and single family homes anywhere from $80 all the way up to $650 per month total. Some properties have multiple HOAs like Summerlin. There is the community HOA and then the Summerlin Master HOA. Always be mindful of that second one, many people overlook that! 

Pest Control: Some parts of Las Vegas can have issues with pests like termites, scorpions, and ants. Many have pest control services and these are less than $100 per month. In my experience I haven’t had any issues with these nor have my clients. This is not mandatory. 

Home Security System: There are numerous home security options that you can install for less than $200 per month. 

Landscaping and Gardening:  most properties here have desert landscaping with drought tolerant plants so this will be mostly a preference for you, not major upkeep. These require minimal water and are watered through automated drip irrigation. 

Upgrades and Renovations: Over time you will eventually want to invest in home improvements to update the property or add value. These range in price and are more a preference than an actual cost of ownership. 

Pool Maintenance: If you are doing this yourself pool maintenance and chemicals will cost less than $100 per month. If you hire a service it can vary up to a couple hundred dollars per month. Your utility bills will also go up. Water usage will increase especially during the Summer because of evaporation, electricity will increase to run the equipment, and if heated your gas will go up when you use it. 

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