- In this video, you'll learn about
hidden and additional costs when buying a home,
such as lawyer fees, home inspections and more.
That's starting right now.
- [Announcer] Welcome To Homebuyer's School,
brought to you by Brookfield Residential.
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- Hi everyone, I'm Karl.
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So today I've got a special guest.
I've got local realtor Brad McCallum
from RE/MAX First.
And the topic we're gonna answer today is,
what are the hidden costs when buying a home?
- When you go and you buy a home,
people are often sort of laser-focused on,
"What's my monthly payment?
"My costs and my mortgage?"
And then there's things like your property taxes,
that are on top of it.
Oftentimes when people move from say,
the renting to home ownership,
they're also going up in square footage.
In moving to a larger space
there's added costs for your heating,
for your water, for your gas,
for all those sorts of things.
Those are costs that people
don't really kinda understand maybe up front.
It's good to kinda go into it
with an idea of what those costs will be.
But then there's some other things
that are a little bit less.
They don't show up quite as apparently
as on a ledger,
and that's things like maintenance, right?
As soon as you own your own home,
there's everything from maintaining your furnace,
and changing furnace filters,
and keeping your lawn presentable,
and there's just home maintenance that you need to do.
Everything from your gutters to checking your
door lock sets.
All these little tiny things, they take time.
It's just part of home ownership
that a lotta people, they don't really account for.
- If you're buying condo,
there is a different type of maintenance
- For sure. - Than you would a duplex,
than a single-family. - That's right.
- And then up to a luxury rate.
- A lotta times people have this mistaken idea
that a condo, or that the condo fees
are just a cost
that they have to pay each month
for the privilege of having these shared uses,
or these shared spaces.
But a big part of those condo fees
can oftentimes cover maintenance on your lawn,
maintenance on the exterior of the building.
In some cases, it covers, like your building envelope.
These are all things that,
if you owned a single-family home,
you'd be responsible for maintaining
and paying for anyways.
It's just taking that cost,
and rather than being saying $15,000 to do your roof
15 years from now, or ten years from now,
it's going to be something that's
amortized over those months.
And because of that,
condos oftentimes make it easier for you to have
something that you can expect
each month for your costs.
Every home, there is costs involved with maintenance,
whether they're in fees, or they're bore by the end user.
- And if you wanna know more about
the differences between condos and single-family homes,
check with this video above
and in the description below.
I would also imagine that
location plays a big part of costs.
The hidden costs might not be in the home itself,
but it could be, let's say,
your transportation costs.
- A lotta times people,
they think of like living right downtown.
And so, okay, great.
So you're saving a lot on your transportation costs.
But then you're often paying a lot higher price
per square foot for the unit,
for the home itself.
And then if you come out to the suburbs,
you're generally gonna get
more square footage.
You're going to get a little bit more room around you.
And you're gonna get a little bit more for your money.
But you're gonna pay that price then in transportation
to your downtown.
Those are some of the costs that
people don't account for.
It just comes down to each buyer.
They have to really consider what
their own personal needs are,
and then they'll be able to make that proper
adjustment on what they value.
- So as a realtor, have you found differences
when someone's buying a new
versus a resale home
in terms of the additional costs
that they would have to pay.
- Absolutely.
All new homes going to come with
a new home warranty.
And that's really going to protect the buyer
for that first initial few years
from any of the things that might pop up.
So, some will be for five years.
Some will be as much as 10 years
on things like foundation and the building envelope.
But if when you buy a used home,
you're now faced with the fact that
you have to own all the past owners' maintenance.
And did they do it, or did they not?
And so, as a realtor,
one of the things that we need to do
is help our clients find a home
that is not just, meets their needs,
but also understand whether or not
it's been well-maintained.
Understand if that roof needs to be done
in a few years.
Understand what costs might be coming their way
in the next, say, three to five years.
So that way they understand the full picture
of what they're actually purchasing.
That's also one reason why
we recommend home inspections,
so we can get a professional in there
who sees this stuff every day
and get their opinion on what
those maintenance costs might be.
- That would be an additional cost
is the home inspection, right?
- Yes, the home inspection,
you're gonna be paying anywhere from $450 to $550,
but it's like buying insurance.
It makes so much sense, - Yeah.
- I own life insurance but I didn't die last month.
Not a waste (both chuckling).
It's what you want to have that peace of mind
when you're making a big purchase.
- There is more to buying a home
than just your mortgage, right?
There's location, the type of home you're buying,
new versus used, right?
There's all these different costs
that people have to understand that isn't just,
"Hey, I got pre-approved,"
or, "I got approved,
"this is how much I'm paying."
- Absolutely, and that's why
you really wanna be working with somebody you can trust,
so you can have that conversation with them and say,
"Hey, I'm looking at this property,
"or this area, or this community,
"what are the things that I'm not yet considering?
"What are the hidden costs."
If you have that conversation,
they'll be able to tailor it
to exactly whether or not
it's an older home, a new home.
Whether it's downtown,
whether it's in the suburbs,
just so you get the best information
and so you can make a good buying decision.
- So the question of the day I have for you is,
did you incur any additional costs
when buying your last home?
Let us know in the comments section below.
So if you wanna know more
about the costs of owning a home,
check out this playlist here,
as well as additional home buying videos here.
Don't forget to subscribe
and I'll see you in our next video.