I talked to my dad and he said almost all houses require 1-2k a year in upkeep for things like redecorating, restoration, paint, etc.
property tax is a big issue too. Its my understanding that in Indiana property tax is 8%, so on a 70k appraised house & yard that is about 5.6k a year, which seems excessive and almost the same price as the mortgage (roughly $450 a month). Is this calculation right, are property taxes almost 10% of the total value every year and arguably the same price as the mortgage?
Well, let’s see. My house is appraised at about 70K 4 years old.
I haven’t seen a lot of repair yet. But I have had other houses in the past which did. I always figured on average about $100/mth. just in maintenance and upkeep.
While you may not actually spend that every month there are times when you will spend a lot. Rooftops, paintjobs, plumbing, carpet, etc. So, I think 100/mth a is fair estimate.
Now, comes the real problem. Don’t misunderstand, I don’t have a problem with taxes. But they run me another $200/month, payable each October 31-Dec 31. Gotta hand 'em $2400 every year during Thanksgiving/Christmas. (Bad timing)
Add to that another $150/mth for homeowners insurance.
Where we at now…in addition to the monthly house payment, there is $450-500 mth added expense when you own it yourself. That’s the minimum.
Plus, YOU get to mow the grass.
But the positives (to me) outweigh the negatives. If it’s a matter of finances, you’re probably better of renting and take that $500 month and invest it, and I don’t mean BEER.
Still beats the hell out of having a G**damned landlord.
Property/school taxes
Liability insurance
Homeowner association fees
Landscaping expenses
Homeowner insurance (usually a complete rip-off)
Maintenance, including pricey items such as the A/C system
With that said - Buy! Especially with the current interest rates.
CrankyAsAnOldMan, in my area, taxes are calculated on the value of the house, which is generally close to the amount paid. And, there are significant differences in the tax rates here.
