What's the True Cost of Homeownership? A Complete Guide

Ginny Bartolone
Written by Ginny Bartolone
Updated September 2, 2022
Mother holding toddler
Photo: MoMo Productions / DigitalVision / Getty Image


  • Buying a home costs between 3% and 6% of the price in closing costs and up to 20% for the down payment.

  • Mortgage payments range from $2,100 to $3,100 on average each month.

  • Ongoing maintenance, repairs, and renovations vary based on the age, size, and style of our home.

Get quotes from up to 3 pros!
Enter a zip below and get matched to top-rated pros near you.

The first step to decide whether you're ready to buy your first home is sitting down with your budget and running some serious numbers. After all, the cost of home ownership goes far beyond your monthly mortgage payment and closing costs. 

Before buying a home, it’s important to understand the upfront, monthly, and project costs associated with owning a house. Use this helpful guide to determine the true cost of homeownership and how it fits into your budget.

Costs to Purchase a Home

Let's start at the beginning of the process. You've picked out your dream neighborhood, narrowed down a few mortgage lenders, and even reached out to a local real estate agent. How much money should you have set aside to acquire the house?

According to a July 2022 report from the Census Bureau and the Department of Housing and Urban Development, the median home price in the U.S. is $439,400. However, that cost varies widely based on size, location, age, and condition. 

Down Payment

Several types of home loans are available to home buyers, many of which come with different down payment rates. The down payment is a percentage of the home price you pay at the closing of a home sale. 

Down payments can range anywhere from 3% to 20%, depending on your loan type and the home’s sale price. There are low down payment mortgage options that make it possible to buy a home with less money down.

Closing Costs

Closing costs are the additional fees and charges for buying a home and closing on a mortgage.

These costs typically account for 3% to 6% of the home purchase price, depending on the specifics of your home sale. Based on the July 2022 median home price, closing costs range from about $13,200 to $26,400.

Every sale and state laws are unique, but closing costs typically include fees for things like applications, attorneys, credit reports, property appraisal, and more. Closing costs may also include homeowner's insurance, private mortgage insurance, and a possible escrow deposit to cover the first few months of property insurance and mortgage payments.

Moving Costs

Let's not forget that you need to get from point A to point B when you buy a new home. The average cost to hire movers for a local move is $1,400, whereas out-of-state moves can range from $700 to $10,000. You can also save a bit of money by moving yourself, which costs between $250 and $350 for local truck rentals and up to $2,400 for long-distance treks.

Monthly Costs of Owning a Home

Mother helping children paint in front yard
Photo: MoMo Productions / DigitalVision / Getty Image

Once you've celebrated closing day, said goodbye to the movers, and unpacked the last box, it's time to start making the monthly payments. Here are some of the monthly expenses you can expect to pay as a homeowner.

Mortgage Payments

Your monthly mortgage payment is established by your mortgage lender, and it varies widely based on your home’s purchase price, loan type, mortgage rate, and mortgage term. 

Keep in mind that the money in your mortgage payments doesn't only go toward your loan's principal—or remaining—amount. Your lender often includes other necessary monthly charges in your monthly payment and pays these fees on your behalf.

Here’s how mortgage payments typically break down:

  • Principal: Money that goes directly to the balance of your loan.

  • Interest: Money toward the interest amount your bank charges for the loan.

  • Taxes: Property taxes are held in escrow and then collected by your local government.

  • Homeowner's insurance: Insurance that protects your home against damage.

  • Mortgage insurance: Insurance that protects the bank if you cannot pay your loan. Note that this is not necessary for all loans.

Property Taxes

Property taxes vary by where you live. Each state sets a real estate tax rate, and the assessment of your home and property will determine the final amount. Annual property tax amounts range from about $600 to $5,500.


The average cost of homeowner's insurance per year is $1,500, but the location, size, and condition of the home will play a large factor in the price. Above all, banks assess the risk of your home becoming damaged by things like wind, rain, and fire and will require additional flood insurance in some regions.

If you are required to pay private mortgage insurance (PMI) by your lender, you will also pay between ½% and 1% of your loan each year.


You’ll need to budget for utility expenses, including water, electricity, gas, and the internet. The average monthly cost of utilities for a home is about $290, though some states pay higher utility bills than others. For example, Hawaii, New Hampshire, and Connecticut pay an average of over $350 a month

Homeowners Association Fees

If you are part of a homeowner's association, you may pay between $200 and $300 per month in dues. These associations perform various duties, from providing community amenities to resolving legal disputes with neighbors. 

Maintenance Costs to Own a Home

Here are the most common maintenance costs to expect when you own a home.


Homeowners spend an average of $40 to $50 a month on cleaning supplies to maintain and clean the house themselves. Otherwise, the cost to hire a housekeeper costs about $30 to $50 per hour.


Between upfront costs to spruce up your landscape—like new shrubs, trees, rock gardens, —expect to pay about $3,400 to landscape your new yard. 

Preventive Inspections

While you recently paid for a home inspection when you bought your house, regular preventive maintenance inspections can help you avoid future problems with high costs. The inspections cover everything from your roof and chimney to your HVAC system, costing $300 to $400 every three to five years.

Chimney Care

Hire a chimney sweep for an inspection and cleaning at least once per year. Older homes may require a cleaning before and after the primary fire season. The chimney sweep visit will cost between $130 and $380


Your roof is another part of your home that a professional should inspect at least once per year. Catching damage early is key, especially if your home experiences severe weather. Inspections can range anywhere from $75 to $800, depending on the size and complexity of your roof.


It’s inevitable that, over time, systems and appliances in your home will need repairs. Here’s what you can expect to pay to repair items in your home.

Renovation and Remodeling Costs

One of the many homeownership benefits is being able to change the color of your kitchen cabinets or replace those wall-to-wall carpets. While costs widely vary, the 10 most popular home renovation projects cost anywhere from a few hundred to several thousand dollars.

According to Angi’s State of Home Spending report, homeowners spent an average of $10,400 on remodeling projects in 2021.

Research the costs associated with completing your desired renovation or remodeling project before diving into it. For example, if you want to build a fence around your property, consider the cost of materials, installation, labor, and maintenance.

Need professional help with your project?
Get quotes from top-rated pros.