The Hidden Costs of Homeownership Top $16,000 a Year
A new analysis from Zillow and Thumbtack shows that the hidden costs of owning a home now total $15,979 per year nationwide. Rising expenses for maintenance, insurance, and property taxes are climbing faster than household incomes, reshaping what it truly costs to own a home in today’s market.
The True Price of Homeownership
On average, homeowners spend $10,946 per year on maintenance, $2,003 on homeowners insurance, and $3,030 on property taxes. Together, these add up to more than $1,300 per month in additional costs beyond the mortgage. Over the past year, these expenses have increased by 4.7 percent, while household incomes rose by only 3.8 percent. For many families, that difference is enough to tighten budgets and make homeownership less affordable.
Coastal Metros Feel the Sharpest Squeeze
In already expensive coastal markets, these hidden costs are even higher. Homeowners in New York City pay an average of $24,381 per year, while those in San Francisco spend about $22,781 and in Boston about $21,320. These amounts come on top of some of the highest mortgage payments in the country, putting additional strain on affordability in the nation’s largest metro areas.
Insurance Costs Outpace Incomes
Insurance premiums are among the fastest rising homeownership expenses. Nationwide, average premiums have increased 48 percent since early 2020 and now total just over $2,000 per year.
In parts of the country, the increases have been far steeper. Miami homeowners now pay an average of $4,607 annually, a 72 percent increase in five years. Similar jumps have occurred across Florida, with premiums up 72 percent in Jacksonville, 69 percent in Tampa, and 68 percent in Orlando. Outside the state, premiums have climbed 79 percent in New Orleans, 59 percent in Sacramento, 58 percent in Atlanta, and 56 percent in Riverside, California. These increases have far outpaced income growth, creating new challenges for first-time buyers and long-time owners alike.
What’s Behind the Numbers
Zillow’s analysis combines local estimates of property taxes and insurance premiums with Thumbtack’s data on the annual cost of home maintenance. Thumbtack’s estimates cover a range of routine and seasonal projects, including heating and cooling system maintenance, roof repair, lawn care, gutter cleaning, and tree trimming. The cost estimates are based on real project data reported by homeowners and professionals across the country and are updated regularly to reflect changing market conditions.
By combining these data sources, the analysis captures the ongoing financial demands that come with homeownership. These expenses are essential to preserving a home’s value and livability, yet they are often overlooked by new buyers focused primarily on mortgage costs.
The Bottom Line
Homeownership continues to be a cornerstone of financial stability, but the ongoing expenses of maintaining a home are rising faster than paychecks. In a market defined by high mortgage rates and limited housing supply, understanding these hidden costs is critical for anyone planning to buy or keep a home. Knowing the full financial picture helps buyers make informed decisions and prepare for the real cost of owning a home in today’s market.