Navigating the True Cost of Homeownership in Different Housing Markets

by EV Atlanta

Missy Derr, a real estate advisor with Engel & Völkers, noted, “It is important to understand that your ‘initial costs’ associated with buying a home are not just limited to down payment or inspection costs or even the closing costs that make up attorney and lender fees plus escrows for taxes, HOAs and insurance.”

“The cost of homeownership continues past the day you wire all of your funds to purchase and pay your monthly mortgage; there are other factors to consider,” Derr explained. “An overlooked thing to be aware of is that the amount actually needed for property taxes may vary! Your first-year payments are based on previous tax years.”

“Property taxes can even increase years in the future due to property values rising. This can be mitigated by filing your homestead exemption promptly and arguing these increases, which will either cost you time or money, and sometimes both, if you hire a lawyer on your behalf,” Derr said.

New Jersey

Rivera agreed with Derr that the true cost of homeownership goes beyond the purchase price — it includes property taxes, insurance, maintenance and possibly HOA fees.

In New Jersey, specifically the city of Hoboken, “…property taxes can be around 1.6% of the home’s value annually. Home insurance averages $1,200 per year, and maintenance can vary, but generally plan for 1%-2% of the home’s value yearly for upkeep,” Rivera said.

Specifically, he highlighted that northern New Jersey “has nuances worth noting.”

“Jersey City’s ongoing development projects might lead to higher property taxes in the future, but the current incentives and lower initial property prices compared to Manhattan make it an attractive market,” Rivera explained. “Rental income here is also robust, often offsetting ownership costs significantly for investor-landlords.”

Georgia

According to Derr, the average home buyer in Georgia spends between $26,788 and $92,697 when purchasing a $327,174 home — the state median value. Derr cited that different areas of America’s weather alone will determine the frequency of cost and maintenance on your home, adding to the cost.

“In Atlanta and the Southeast, our ACs are replaced much more frequently than our furnaces, which would be the reverse for those in the Northeast,” said Derr. “Our roofs even wear differently based on how much sunlight they receive and how stifling hot our attics get in the warmer months. Areas with colder temperatures usually use oil to heat their homes, while urban southern areas rely on electricity and gas!”