Denver Home Ownership Hidden Costs

Now that you have carefully determined how much you can
afford for your mortgage, property taxes and homeowners insurance each month,
you need to factor in expenses that you may not have considered when altering
your budget for home ownership.  If you are ready to make the leap from
renting to buying, don’t let these expenses dissuade you.  But be aware of
them and prepare for them, so that they won’t push you into unexpected debt.

Maintenance  The amount of money it will take to maintain your home depends on
many factors (age, condition, etc…), but you should set aside a minimum of 1% of
its value each year for repairs and maintenance.  Many believe that this
number needs to be closer to 2-3% to keep a home well-maintained.  Ignoring
small problems or putting off their repair can lead to much larger and more
expensive repairs down the road.

Supplemental
Insurance  If you live in an area prone to
tornados, floods or hurricanes, these perils are generally not covered under
your basic homeowners policy, and you should purchase supplemental insurance to
cover your risk.  Also, if you have a large collection of antiques,
valuable jewelry or lots of computer equipment, you may need to purchase an
insurance rider on your homeowners policy to cover these items in full.

Home
Improvements  One of the great parts of
being a homeowner is being able to personalize your home the way you want. 
However, relatively few home improvement projects add much lasting value to your
home, much less guarantee that you’ll recoup your costs.  It is best to pay
for these improvements as you do them, since experts recommend borrowing money
only to buy assets that appreciate in value.

Furnishings  If your new home is larger than your present residence, you will
likely need some new furniture.  You may also need window treatments,
appliances, lighting fixtures, rugs, or a number of other items.  Figure
out your budget ahead of time and make sure you have that amount in
savings.  Otherwise you may find yourself in your dream home - hanging
sheets over your windows for privacy while you eat dinner off of paper plates
sitting on the floor in your empty dining room.

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