First time home buying comes with a lot of preparation. There’s way more to buying a home than simply saving up enough money for a down payment and getting approval for a mortgage loan. If you’re a first-time home buyer, you might be surprised to find out just how many out of pocket expenses there are when you buy a home. We’ve created this list to help you save up enough money for all of the hidden expenses that come with buying a home – so you’re not shocked when you find out just how much you need to have saved!

Property Taxes

Property taxes vary depending on which state you live in. For example, the average percentage of property tax in California is 0.77%, 1.1% in Florida, and 1.68% in New York. You might want to take this into consideration when you’re buying a house, so you can move to a state that has a cheaper property tax. Every homeowner needs to pay property taxes. You can include this in your monthly mortgage payment or as a separate bill.

Appraisal Fee

Before you get approval for a mortgage loan, the loaner is going to want to make sure the house they’re loaning you money to purchase is valuable – a finished basement, attic insulation, and an outdoor seating area all add value to a home. The loaner will send someone to your home to check the value, which will cost you several hundred dollars.

Closing Costs

Besides the 20% down payment, there’s also a 2 to 5% closing cost fee. The average of closing cost fees is at least $3,500, and depending on the price of the house, can be $10,000. The closing costs vary depending on your mortgage lender and the state. The good news is that your mortgage loaner will send you a loan guesstimate within several days of approval. The estimated closing cost fees will be included in this.

Home Repair

Depending on the age of the house, chances are, it’s going to require some sort of maintenance and repair. Whether you’re a handyman who can fix pretty much anything or someone who’s never picked up a hammer in their life, you’re going to need to budget something for home repair. Painting rooms and replacing a refrigerator can cost several thousand dollars.

Home Maintenance

General maintenance like yard work can be costly and add up quickly.  If something breaks, you’re going to need to either fix it yourself or pay someone who can. In the wintertime, you’ll need to think about plowing your driveway and keeping your house warm, and in the summertime, you might want to keep your house cool with air conditioning. These are all hidden costs that can add up quickly if you’re not careful!

Homeowner’s Insurance

Homeowner’s insurance is a necessity and will protect your home in case of damage from fire, flooding, earthquakes, hurricane winds, etc. This is something that can be added in conjunction with your car insurance. On average, you can expect to pay over $800 annually for homeowner’s insurance. This varies by state, the age of your home, and whether you have high risk factors like a swimming pool or live in a high-risk area where natural disasters are more common.

Now that you’re fully aware of some of the hidden costs that come with buying a home, you’ll be more prepared when completion day comes! As long as you prepare ahead of time and save enough money to cover these costs, you’ll be well prepared and ready to own a home.