Study Finds ‘Hidden’ Costs of Homeownership Hit $16,000 Annually

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Zillow, Seattle, and Thumbtack, San Francisco, released a new analysis finding that the hidden costs of homeownership add up to $15,979 per year.

That’s an additional $1,325 per month on top of a mortgage payment.

The analysis broke down that figure as $10,946 on maintenance, $2,003 on homeowner’s insurance and $3,030 on property taxes for the typical U.S. homeowner.

Those costs, combined, have increased 4.7% over the past year. That compares with just a 3.8% rise in household income.

Hidden costs are more pressing in some areas than others. In New York City, the analysis finds hidden costs reach $24,381, with $22,781 in San Francisco and $21,320 in Boston.

Insurance costs are a particular sticking point–up 48% since February 2020. That also varies by area, with premiums up by 72% in Miami in the past five years, for example.

“Insurance costs are rising nearly twice as fast as homeowner incomes,” said Kara Ng, Zillow senior economist. “It’s not just a budget line item. It’s a barrier to entry for aspiring first-time buyers and for families already stretched thin. Buyers who are already facing affordability challenges in today’s market need to understand and budget for these less obvious expenses when calculating how much home they can truly afford.”