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The first year in a new house will bring all sorts of new joys, from decorating everything just the way you like it to spending your first holiday season in your own home. But the first year as a homeowner can also bring financial surprises — if you aren't prepared.

Some costs of homeownership, like property insurance and utilities, will need to be factored into your budget. Other, optional costs, such as a patio set, grill, and any other creature comforts you may not have had if you came from an apartment, should be considered in your first year of homeownership so that you can start saving up as soon as possible.

To help you plan, here are some of the most common expenses associated with owning a home.

Recurring Homeownership Costs You Should Budget For

The recurring costs of homeownership are unavoidable; they're the ones that you'll need to pay for as long as you own a home. After one year as a homeowner, you'll probably have a good idea of how much you'll need to set aside for the following.

  • Property Insurance: You'll need a homeowners policy to protect against unexpected losses due to natural or man-made disasters, theft, or accidents related to your home.
  • Utilities: Utility expenses include necessities like electricity, gas, water and sewage, and trash and recycling collection.
  • Home Services: You might want to budget for extra services like internet access, cable TV service, landline phone service, or home security monitoring.
  • Real Estate Taxes: As a homeowner, you'll be responsible for real estate taxes, which may either be collected as part of your mortgage payment or paid separately. Your real estate tax liability may also increase if your property’s value is reassessed after your purchase.
  • Lawn Care: You might pay fees to a Homeowners Association (HOA) that covers lawn maintenance for you. If not, you'll need to budget for landscaping costs, including buying a lawnmower or paying for lawn care service. You'll also need to budget for fertilizing your grass and caring for any trees and plants on your property.
  • Repairs: It would be wise to start an emergency savings fund as soon as possible for those inevitable times when an appliance breaks down or your HVAC or plumbing system needs to be fixed.

Additional Homeownership Costs You Should Consider

The first year in a home is the perfect time to think about home improvement projects and how much you'll need to make the home of your dreams. While these projects can be costly, they can be worth the investment if they increase your enjoyment of the house and raise its overall value.

Here are some home improvements you might consider.

  • Cosmetic Changes: Painting projects can be relatively inexpensive if you're just covering a few walls and are willing to do the work yourself. You'll need to budget more to hire a professional crew, or if you want the house's exterior painted. New flooring is another cosmetic change that can instantly update the look and add value to your home.
  • Exterior Upgrades: Exterior work may include adding a fence, repaving the driveway, building a deck, or installing new landscaping.
  • Remodeling: Large-scale renovations can be expensive, though you're likely to gain some return on your investment if you end up reselling the house. You should start saving for these more costly projects as soon as possible.

If you're feeling overwhelmed by the costs of homeownership and need help with saving, budgeting, or choosing between home improvement projects, a financial wellness review with one of our financial advisors can help you get the most out of your new home.

This material is presented for informational purposes only and should not be construed as individual tax or financial advice. KeyBank does not provide legal advice.

By selecting any external link on, you will leave the KeyBank website and jump to an unaffiliated third-party website that may offer a different privacy policy and level of security. The third-party is responsible for website content and system availability. KeyBank does not offer, endorse, recommend or guarantee any product or service available on that entity's website.

NOTICE: This is not a commitment to lend or extend credit. Conditions and restrictions may apply. Information and offers are subject to change without notice. All loans are subject to credit and collateral approval. Not all loans or products are available in all states.

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