The cost of homeownership in the US has risen by 26% since 2020, with expenses such as taxes, insurance, and utilities all increasing during a period of high inflation.
According to personal finance website Bankrate, the average annual expense for owning and maintaining a typical single-family home, excluding mortgage payments, reached $18,118 in March. This amounts to $1,510 per month, approximately $300 more than four years ago when the pandemic lockdowns began.
The calculation is based on Redfin’s March median sales price of $436,291.
“It was really eye-opening to see just how much it costs to maintain a home,” said Jeff Ostrowski, an analyst at Bankrate. “Until you own a house, it doesn’t dawn on you how much money you’re throwing into the house every month and year.”
In its analysis, Bankrate included property taxes, home insurance, energy costs, internet and cable bills, and 2% of the sales price for maintenance—expenses many buyers tend to underestimate.
Home maintenance represented the largest portion of ownership costs in Bankrate’s findings. Therefore, states where purchase prices increased significantly during the pandemic saw higher percentage jumps in overall expenses. Property taxes were the second-largest cost in high-tax states like New Jersey and Connecticut, while in others, energy bills were the second-highest expense.
Over the past four years, homeowners in Utah experienced the biggest increase in expenses, which surged 44%. Idaho followed at 39%, and Hawaii at 38%. Alaska and Texas saw the smallest increases, with costs rising 14%. Annual costs varied significantly, from $11,559 in Kentucky to $29,015 in Hawaii.
Ostrowski noted that these totals might be overstated, especially for owners of newly built homes that don’t require repairs, but they are still useful for buyers to consider.
“It’s certainly better to be over-prepared and have some extra money sitting in a high-yield savings account,” he said, “as opposed to under-prepared and scrambling.”
