Buying a house is a serious undertaking, but the cost of owning one is a different ballgame

Unlike renting, homeownership can come with new responsibilities like mowing the lawn - and new expenses like homeowners association fees.

Becoming a homeowner is a major life milestone, but it's not an easy transition from renting. Many experienced homeowners will know there's a steep learning curve that can include financial surprises.

Unlike renting, homeownership can come with new responsibilities like mowing the lawn - and new expenses like homeowners association fees.

Maintaining a home has become more expensive over the years. Sharp increases in labor and material costs have pushed up the average yearly maintenance costs for a single-family home to nearly $11,200 as of the second quarter of 2026, up 2% from a year ago, according to a report by Thumbtack.

Many new homeowners are often caught off guard by these costs. Nearly 6 in 10 homeowners who bought a single-family home in the last two years said that maintaining their house had been more expensive than expected, according to a survey by Jobber, a home-services startup. Gen Z and millennial home buyers in particular were shocked by how stressful owning a house is; 69% of millennial homeowners said they needed to make surprise repairs on their home.

With so much attention focused on the high purchase price of a home these days, it can be tempting for buyers to overlook or minimize the ongoing costs of homeownership until they've moved in. These ancillary costs are catching people off guard, said Joel Berner, a senior economist at Realtor.com.

"And in this environment, where affordability is stretched so thin to begin with ... there's not a lot of wiggle room," he said.

(Realtor.com is operated by News Corp subsidiary Move Inc.; MarketWatch publisher Dow Jones is also a subsidiary of News Corp.)

What financial miscalculations are new homeowners making? MarketWatch spoke to a variety of experts, from contractors to economists, to identify some of the most common hidden costs of owning a home that new homeowners can miss or underestimate.

Related: The 10 housing markets where the most sellers have listed their homes for less than what they paid

Underestimating property taxes

New homeowners might be surprised to find that their first year's property-tax bill was a lot smaller than the second year's. They might base their assumption about their tax bill on the estimated property taxes in the home's for-sale listing, or information that was given to them at the closing.

But those figures might not be updated, and could understate what they will likely owe.

As home prices exploded over the last few years, so have home values - and, in turn, property-tax bills. In 2025, the average single-family home valued around $494,000 saw a 3% increase in property taxes from the prior year, according to a report by property-data company Attom. Homeowners paying the highest bills on average were in New Jersey, Connecticut and New Hampshire. The combination of high tax rates and home values meant that the average tax bill for homeowners in the Garden State was about $10,500; in Connecticut, it was about $8,900.

Property taxes can increase after the first year if the local government reassesses the home's value after it changes hands, or if the property's assessed value changes under local tax rules.

The jump in taxes is quite significant for newly built homes. When a builder is constructing a home, the taxes are based on the value of the land. But after the home is completed, the taxes are based on the new assessed value, which includes the completed home and the land. So a homeowner moving into a new build might see a big jump in property taxes in their second year.

The jump can be equally meaningful with resale homes. If a new homeowner purchased a property at a significantly higher purchase price as compared to the home's last assessed value, local tax assessors could update the property value, and that could mean higher taxes.

State and local tax quirks could also play a role in surprise bills. In California, if a homeowner had lived in a property for decades, their property-tax increases were limited to 2% per year under Proposition 13. So even though their home's value might have shot up over the years, their bill was still relatively low. When that home is sold to a new owner, the county generally reassesses the home based on the purchase price. So if a new buyer buys a home at a significantly higher price, then they could be on track to pay a much higher tax bill. The higher tax bill might not be fully apparent until the following tax year, or if the county issues a supplemental tax bill.

Homeowners in some parts of California may also owe additional Mello-Roos taxes. These are special assessments used to fund infrastructure like schools and roads. They are separate from regular property taxes and potentially add thousands of dollars in extra property-tax payments per year, which could come as a surprise.

"Especially in new developments, you have all these surprises, because everything is brand new," Miklos Ringbauer, founder of MiklosCPA, a Southern California-based accounting and tax advisory company, told MarketWatch.

The additional cost "could be a couple of hundred dollars to a couple of thousand dollars, and also depends on the size of the property you buy," he added.

"Understanding these taxes can prevent unpleasant surprises when it's time to pay those property-tax assessments," Ringbauer said.

Assuming the home inspection will uncover every problem

Home inspectors can catch key structural issues that might turn a dream home into a nightmare down the line - but one contractor advises new homeowners not to rely too much on them to find issues that could balloon into giant problems. Even after a perfect home inspection, hidden issues can emerge after a new homeowner moves in.

Inspections are "not designed to give you conclusive guidance on the state of the house," said Deon Marecheau, a member of Thumbtack's Pro Advisory Board and owner of Antillean Restoration. "Inspections will only show you things that are clear and present and in your face." Home inspectors don't open up walls and remove flooring to check for hidden defects in a home, he noted.

One solution is to visit a house you're thinking of buying in the middle of a rainstorm, when water-related problems can become more obvious, Marecheau said. Telltale signs of water damage include discolored wall panels, black mold, cracking plaster or peeling paint, just to name a few. The cost of fixing a house with water damage can run from a minimum of $500 to $15,000, depending on how deep the water has seeped into the home and how much intervention is required, he said.

Standard home inspections don't necessarily involve checks for problems like lead, mold or termites - but that also varies by state and inspector.

Mold, in particular, can be a huge pain to resolve. For example, if exterior stucco is improperly applied to a home, water can get trapped, allowing mold to grow underneath if drainage is not installed properly, George Morris, CEO of Century21 Everest in Midvale, Utah, told MarketWatch. Mold can pose health risks for some groups of people, and is expensive to remediate.

"Stucco really came onto the scene in a really big fashion in the 1990s," Morris told MarketWatch. "But so much of it was done poorly, and incorrectly." If mold is a concern, home buyers should consider hiring a mold specialist or asking home inspectors to test for mold, if possible, and stay vigilant about the potential growth of the fungus.

Not bracing for swings in utility costs

New homeowners might base their budget for utility costs on conversations with their real-estate agent, or even the previous homeowner. But utility costs have become volatile, and the previous owners' bill could be much lower than what a new owner will pay.

Surging energy costs and extreme weather events have resulted in utility bills swinging widely. Monthly utility costs for a median-priced home have jumped from $170 in 2012 to $270 today, according to analysis by Homes.com.

But homeowners can see much bigger monthly bills during the scorching summer or freezing winter months, when they might run their heating or air-conditioning systems more aggressively. This can be an unwelcome surprise, especially for people moving from an apartment to a house.

"While I budgeted down to the penny for the mortgage, property taxes and insurance, I am in actual shock at our electric bills. I guess I just didn't realize how much more it cost to heat/cool a whole house compared to our old apartment," one person wrote in a social-media post on Reddit. "Did this catch anyone else off guard their first year?"

Related: One in five Americans can't afford their heating bills this winter as people are blindsided by utility costs

Not anticipating sudden jumps in homeowners association fees

New homeowners who are moving into properties with a homeowners association might be hit with a big bill if their HOA runs into financial trouble. That could lead to a nasty surprise for which they might not have budgeted.

HOA fees are common for condo buildings, and they're becoming more common for single-family homes. They're on the rise and can become a real pain point for homeowners.

Median HOA fees grew 25% between 2019 and 2025, according to a report by Realtor.com. In 2025, about 85% of condo listings included mention of HOA fees, while 33% of single-family homes did.

On top of monthly dues, some communities might also require homeowners to pay special assessments to cover sudden repairs for the building or funding shortfalls.

MW 5 expensive surprises new homeowners face - and how to avoid them

By Aarthi Swaminathan

Buying a house is a serious undertaking, but the cost of owning one is a different ballgame

Unlike renting, homeownership can come with new responsibilities like mowing the lawn - and new expenses like homeowners association fees.

Becoming a homeowner is a major life milestone, but it's not an easy transition from renting. Many experienced homeowners will know there's a steep learning curve that can include financial surprises.

Unlike renting, homeownership can come with new responsibilities like mowing the lawn - and new expenses like homeowners association fees.

Maintaining a home has become more expensive over the years. Sharp increases in labor and material costs have pushed up the average yearly maintenance costs for a single-family home to nearly $11,200 as of the second quarter of 2026, up 2% from a year ago, according to a report by Thumbtack.

Many new homeowners are often caught off guard by these costs. Nearly 6 in 10 homeowners who bought a single-family home in the last two years said that maintaining their house had been more expensive than expected, according to a survey by Jobber, a home-services startup. Gen Z and millennial home buyers in particular were shocked by how stressful owning a house is; 69% of millennial homeowners said they needed to make surprise repairs on their home.

With so much attention focused on the high purchase price of a home these days, it can be tempting for buyers to overlook or minimize the ongoing costs of homeownership until they've moved in. These ancillary costs are catching people off guard, said Joel Berner, a senior economist at Realtor.com.

"And in this environment, where affordability is stretched so thin to begin with ... there's not a lot of wiggle room," he said.

(Realtor.com is operated by News Corp subsidiary Move Inc.; MarketWatch publisher Dow Jones is also a subsidiary of News Corp.)

What financial miscalculations are new homeowners making? MarketWatch spoke to a variety of experts, from contractors to economists, to identify some of the most common hidden costs of owning a home that new homeowners can miss or underestimate.

Related: The 10 housing markets where the most sellers have listed their homes for less than what they paid

Underestimating property taxes

New homeowners might be surprised to find that their first year's property-tax bill was a lot smaller than the second year's. They might base their assumption about their tax bill on the estimated property taxes in the home's for-sale listing, or information that was given to them at the closing.

But those figures might not be updated, and could understate what they will likely owe.

As home prices exploded over the last few years, so have home values - and, in turn, property-tax bills. In 2025, the average single-family home valued around $494,000 saw a 3% increase in property taxes from the prior year, according to a report by property-data company Attom. Homeowners paying the highest bills on average were in New Jersey, Connecticut and New Hampshire. The combination of high tax rates and home values meant that the average tax bill for homeowners in the Garden State was about $10,500; in Connecticut, it was about $8,900.

Property taxes can increase after the first year if the local government reassesses the home's value after it changes hands, or if the property's assessed value changes under local tax rules.

The jump in taxes is quite significant for newly built homes. When a builder is constructing a home, the taxes are based on the value of the land. But after the home is completed, the taxes are based on the new assessed value, which includes the completed home and the land. So a homeowner moving into a new build might see a big jump in property taxes in their second year.

The jump can be equally meaningful with resale homes. If a new homeowner purchased a property at a significantly higher purchase price as compared to the home's last assessed value, local tax assessors could update the property value, and that could mean higher taxes.

State and local tax quirks could also play a role in surprise bills. In California, if a homeowner had lived in a property for decades, their property-tax increases were limited to 2% per year under Proposition 13. So even though their home's value might have shot up over the years, their bill was still relatively low. When that home is sold to a new owner, the county generally reassesses the home based on the purchase price. So if a new buyer buys a home at a significantly higher price, then they could be on track to pay a much higher tax bill. The higher tax bill might not be fully apparent until the following tax year, or if the county issues a supplemental tax bill.

Homeowners in some parts of California may also owe additional Mello-Roos taxes. These are special assessments used to fund infrastructure like schools and roads. They are separate from regular property taxes and potentially add thousands of dollars in extra property-tax payments per year, which could come as a surprise.

"Especially in new developments, you have all these surprises, because everything is brand new," Miklos Ringbauer, founder of MiklosCPA, a Southern California-based accounting and tax advisory company, told MarketWatch.

The additional cost "could be a couple of hundred dollars to a couple of thousand dollars, and also depends on the size of the property you buy," he added.

"Understanding these taxes can prevent unpleasant surprises when it's time to pay those property-tax assessments," Ringbauer said.

Assuming the home inspection will uncover every problem

Home inspectors can catch key structural issues that might turn a dream home into a nightmare down the line - but one contractor advises new homeowners not to rely too much on them to find issues that could balloon into giant problems. Even after a perfect home inspection, hidden issues can emerge after a new homeowner moves in.

Inspections are "not designed to give you conclusive guidance on the state of the house," said Deon Marecheau, a member of Thumbtack's Pro Advisory Board and owner of Antillean Restoration. "Inspections will only show you things that are clear and present and in your face." Home inspectors don't open up walls and remove flooring to check for hidden defects in a home, he noted.

One solution is to visit a house you're thinking of buying in the middle of a rainstorm, when water-related problems can become more obvious, Marecheau said. Telltale signs of water damage include discolored wall panels, black mold, cracking plaster or peeling paint, just to name a few. The cost of fixing a house with water damage can run from a minimum of $500 to $15,000, depending on how deep the water has seeped into the home and how much intervention is required, he said.

Standard home inspections don't necessarily involve checks for problems like lead, mold or termites - but that also varies by state and inspector.

Mold, in particular, can be a huge pain to resolve. For example, if exterior stucco is improperly applied to a home, water can get trapped, allowing mold to grow underneath if drainage is not installed properly, George Morris, CEO of Century21 Everest in Midvale, Utah, told MarketWatch. Mold can pose health risks for some groups of people, and is expensive to remediate.

"Stucco really came onto the scene in a really big fashion in the 1990s," Morris told MarketWatch. "But so much of it was done poorly, and incorrectly." If mold is a concern, home buyers should consider hiring a mold specialist or asking home inspectors to test for mold, if possible, and stay vigilant about the potential growth of the fungus.

Not bracing for swings in utility costs

New homeowners might base their budget for utility costs on conversations with their real-estate agent, or even the previous homeowner. But utility costs have become volatile, and the previous owners' bill could be much lower than what a new owner will pay.

Surging energy costs and extreme weather events have resulted in utility bills swinging widely. Monthly utility costs for a median-priced home have jumped from $170 in 2012 to $270 today, according to analysis by Homes.com.

But homeowners can see much bigger monthly bills during the scorching summer or freezing winter months, when they might run their heating or air-conditioning systems more aggressively. This can be an unwelcome surprise, especially for people moving from an apartment to a house.

"While I budgeted down to the penny for the mortgage, property taxes and insurance, I am in actual shock at our electric bills. I guess I just didn't realize how much more it cost to heat/cool a whole house compared to our old apartment," one person wrote in a social-media post on Reddit. "Did this catch anyone else off guard their first year?"

Related: One in five Americans can't afford their heating bills this winter as people are blindsided by utility costs

Not anticipating sudden jumps in homeowners association fees

New homeowners who are moving into properties with a homeowners association might be hit with a big bill if their HOA runs into financial trouble. That could lead to a nasty surprise for which they might not have budgeted.

HOA fees are common for condo buildings, and they're becoming more common for single-family homes. They're on the rise and can become a real pain point for homeowners.

Median HOA fees grew 25% between 2019 and 2025, according to a report by Realtor.com. In 2025, about 85% of condo listings included mention of HOA fees, while 33% of single-family homes did.

On top of monthly dues, some communities might also require homeowners to pay special assessments to cover sudden repairs for the building or funding shortfalls.