New Zillow and Thumbtack analysis identifies
the additional costs home buyers can expect, including utilities,
insurance, maintenance and property tax
- Homeowners can expect to pay $14,155 a year, or $1,180 a month, in hidden costs related to owning
a home.
- These annual costs can be as high as $22,791 in the San
Francisco metro area and as low as $9,886 in Las
Vegas.
- Affordability is the No. 1 challenge for first-time home
buyers. Zillow's affordability calculator and new search by monthly
cost tool, along with Thumbtack's personalized maintenance guides,
can help buyers incorporate these costs into their budget.
SEATTLE and SAN
FRANCISCO, June 1, 2023 /PRNewswire/ -- The everyday
expenses of owning a home are higher than ever, according to a new
analysis from Zillow® and Thumbtack. Utility bills, property taxes,
insurance and essential home maintenance can add up to $14,155 a year for the average U.S. homeowner.
That's an additional $1,180 per month
on top of a typical mortgage payment. First-time home buyers facing
affordability challenges in today's market need to understand
and budget for these less obvious expenses when calculating how
much home they can afford.
These costs can be surprisingly high in already pricey metro
areas, topping $22,000 annually in
San Francisco, New York and Los
Angeles. Of the 39 metro areas analyzed, hidden
homeownership costs are the lowest in Las
Vegas ($9,886); Asheville, North Carolina ($11,318); and St.
Louis ($11,824).
Zillow and Thumbtack's research looked at three unavoidable
expenses for single-family homeowners — property taxes, homeowners
insurance and utility payments (energy, water, natural gas and
internet) — and found they averaged $7,742 in total nationally. New Yorkers pay the
highest property taxes, topping $9,000 per year, while utilities cost the most in
Hartford, Connecticut, averaging
$4,443 a year. Costs for homeowners
insurance vary based on home value, so homeowners in the most
affordable metro areas, such as Pittsburgh and Cleveland, have the added benefit of lower
insurance bills.
The analysis also considered Thumbtack's 17 essential home
maintenance projects, based on data from millions of home projects
completed across the country. These projects average a combined
$6,413 annually. The average cost of
upkeep is highest in Los Angeles
and Chicago, totaling $8,639 and $7,722
respectively. Meanwhile, homeowners in Las Vegas can expect to pay just $3,467 per year to maintain their
homes.
"Just like you would visit a mechanic for regular tune-ups to
help keep your car in good condition and avoid big bills, your home
needs the same routine maintenance to ensure that everything is
running smoothly," said David
Steckel, Thumbtack's home expert. "Staying on top of annual
home maintenance will not only increase the value of your home, but
will also help prevent emergency repairs that can wreck a
homeowner's budget."
First-time buyers make up nearly half of all home shoppers
(45%), and they may be caught off guard by these costs and fail to
account for them when budgeting for a home. By starting with the
Home Loans tab on Zillow's homepage, shoppers can use an
affordability calculator to figure out how much they can afford and
then connect with a loan officer to establish not only what
mortgage they qualify for, but what they're comfortable paying,
given these additional costs. With that budget in hand, buyers can
then use a new app filter on Zillow to shop for homes by
monthly cost, instead of by purchase price.
"Understanding all the costs that come with homeownership can
not only impact a buyer's budget, but the type of home they shop
for, too," said Zillow home trends expert Amanda Pendleton. "While a big backyard or a
larger home may be appealing, it's important to consider how much
maintaining those spaces could cost. Buyers may want to
consider affordable alternatives to single-family homes,
or spend more upfront on a new-construction home that could need
less maintenance in the near term."
Once buyers have closed the deal, Thumbtack is the go-to
partner to help care for your new home. By entering their home's
location and features on Thumbtack, homeowners can receive
personalized guidance on what projects to complete, when to
complete them and who to hire to get the job done. This will help
homeowners create prioritized maintenance plans that are within
their budget to cover everything from the move-in house cleaning to
tree trimming and roof maintenance.
Methodology
In this analysis, property taxes were calculated using the
median effective tax rate in each metro area multiplied by the
area's median home value as measured by the Zillow Home Value
Index.
In estimating insurance costs, this analysis assumed homeowners
pay 0.5% of their home's value every year, which was calculated as
0.005 multiplied by the area's median home value as measured by the
Zillow Home Value Index.
Utility costs were calculated using the unweighted average
across all states, excluding streaming and phone bill costs, as
reported by Forbes.
The annual costs of home maintenance consist of Thumbtack
categories that are deemed essential annual tasks for home
maintenance: appliance maintenance, carpet cleaning, central air
conditioning maintenance, deck staining and sealing, duct and vent
cleaning, fireplace and chimney cleaning, full-service lawn care,
gutter cleaning and maintenance, heating system maintenance, house
cleaning, pressure washing, roof maintenance, sprinkler and
irrigation system maintenance, tile and grout cleaning, tree
trimming and removal, water heater maintenance and window
cleaning.
Pricing data is based on projects requested on Thumbtack
reported directly by the independent service professional or
individual customer. The cost is an unweighted index of all yearly
home maintenance projects and is calculated on a quarterly basis
using a moving average.
About Zillow Group
Zillow Group, Inc. (NASDAQ: Z) (NASDAQ: ZG) is reimagining real
estate to make it easier to unlock life's next chapter. As the most
visited real estate website in the United
States, Zillow® and its affiliates offer customers an
on-demand experience for selling, buying, renting, or financing
with transparency and ease.
Zillow Group's affiliates, brands and subsidiaries include
Zillow®; Zillow Premier Agent®; Zillow Home Loans™; Zillow Closing
Services™; Trulia®; Out East®; StreetEasy®; HotPads®; and
ShowingTime+℠ , which houses ShowingTime®, Bridge Interactive®, and
dotloop® and interactive floor plans. Zillow Home Loans, LLC is an
Equal Housing Lender, NMLS #10287 (www.nmlsconsumeraccess.org).
About Thumbtack
Thumbtack is a technology leader building the modern home
management platform. Through the Thumbtack app, homeowners can
effortlessly manage their homes — confidently knowing what to do,
when to do it, and who to hire. Bringing the $600 billion home services industry online,
Thumbtack empowers millions of homeowners to fix, maintain, and
improve their most valuable asset. Hundreds of thousands of local
service professionals, from painters and plumbers to photographers
and electricians, use the Thumbtack platform to grow their business
each year.
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SOURCE Zillow Group, Inc.