The True Cost of Homeownership (2024 Data)

Cost of Owning a Home | Higher Costs Than Expected | Taking on Risks | Buyer's Remorse | Overpaying for a Home | Renter Envy | Homeowner Regrets | Cost of Home Maintenance | Cost of Renovations | Cost of Utilities | Property Taxes and Insurance | Other Hidden Costs

The housing market has frustrated buyers and sellers for the past few years. Interest rates remain around 7%, making mortgages more expensive for buyers. Lower demand has home prices falling, costing sellers potential profits. 

Given the circumstances, many homeowners would prefer to neither buy nor sell, instead opting to stay in their home for the meantime. 

But those homeowners aren't catching a break, either. New data from Real Estate Witch shows that simply holding on to your home comes with crushing costs. Excluding mortgage payments toward principal and interest, the typical homeowner spends about $18,000 a year on home expenses, according to a survey of 1,000 homeowners.

Nearly 9 in 10 homeowners (88%) say the true cost of owning a home is more expensive than they expected. About 67% have regrets regarding their home purchase. 

Some find the cost of homeownership too high both financially and emotionally. About 36% of homeowners say their home has negatively affected their finances, and 23% say it's negatively impacted their mental health.

Maintaining a home can be so overwhelming that about 28% of homeowners are considering going back to renting. 

To learn more, Real Estate Witch surveyed 1,000 homeowners about their expenses and their opinions on the true cost of homeownership.

Homeowners Spend About $18,000 a Year on Non-Mortgage Expenses  

It's no wonder homes are often referred to as money pits. Homeowners spend an average of $17,958 each year on expenses, not including payments toward their mortgage principal and interest. That cost has risen $500, or 2.9%, since 2023. 

Spending $17,958 per year, it would take a homeowner just five years and seven months to rack up $100,000 in additional expenses. Over a 30-year mortgage, that's a whopping $538,740 — enough to buy a second house!

The average homeowner spends the following amounts on additional expenses: 

• $5,362 on utilities 
• $4,392 on maintenance
• $3,784 on renovations
• $2,904 on property taxes 
• $1,516 on homeowners insurance

Of those five categories, 29% of homeowners say they find property taxes to be the single most surprising cost of homeownership:

• Property taxes (29%)
• Maintenance (24%)
• Home improvements (17%)
• Utilities (16%)
• Homeowners insurance (14%)

The $17,958 homeowners spend each year is jarring when compared to what they estimate they spend on these expenses ($10,094). The real cost of homeownership is 78% higher than expected. 

Nearly 9 in 10 Homeowners Say Homeownership Is More Expensive Than Anticipated

New home buyers quickly discover their spending expectations don't match reality. About 88% of homeowners say some costs of homeownership have been more expensive than expected. The most common costs that homeowners say turned out to be pricier than anticipated include:

• Property taxes (35%)
• Roof work (27%)
• Making renovations (27%)
• HVAC (furnace/air conditioning) (26%)
• Plumbing costs (25%)
• Homeowners insurance (24%)
• Maintaining the home's appearance (24%)
• Utilities (23%)
• Electrical work (22%)
• Yard work (20%)
• Upgrading appliances (20%)
• Appliance repairs (17%)
• HOA fees (16%)
• Foundation repairs (14%)
• Home cleaning (12%)

Putting aside their mortgage principal and interest payments, 3 in 5 homeowners (59%) spend at least 10% of their income on additional costs associated with homeownership. Nearly 1 in 4 homeowners (23%) say they spend over 30% of their income on expenses such as maintenance, improvements, taxes, insurance, and utilities. 

The Department of Housing and Urban Development says housing is no longer considered affordable once it requires over 30% of one's income. Even if their mortgage was paid off, 23% of homeowners would still pay unaffordable expenses to live in their home.

1 in 5 Homeowners Have Taken on Debt to Pay for Hidden Costs of Homeownership

Homeowners who underbudget for home upkeep often force themselves into taking risks to make up the difference. About 69% have taken risks or made personal sacrifices to afford additional homeownership expenses. 

About 20% of homeowners say they took on more debt to afford the cost of homeownership. Homeowners also say they: 

• Paid with their credit card (40%)
• Took out a loan (23%)
• Dipped into their retirement savings (22%)
• Went more into debt (20%)
• Sold an expensive possession (e.g., car, jewelry, furniture, etc.) (15%)

High costs of homeownership may explain why 29% of homeowners plan on selling their house in the next five years. About half of homeowners (50%) believe owning a home is not attainable for the average American.

Over Half of Homeowners Feel Buyer's Remorse 

Inevitably, overextended homeowners end up questioning their buying decisions. Nearly 3 in 5 homeowners (58%) say they feel some level of buyer's remorse about their home purchase. 

Homeowners who bought their homes in 2020 or later — in a period of higher prices and now higher interest rates — are more likely to feel buyer's remorse than those who bought before 2020 by a margin of 68% to 54%. 

Although homeownership is often considered a prudent investment and a key component of the American dream, about 36% of homeowners say their home has negatively affected their finances, and 23% say it's negatively impacted their mental health. 

Had they known the total cost of homeownership ahead of time, 60% of homeowners say they would have made a different buying decision. Specifically, homeowners say they would have:

• Purchased a home that requires less maintenance (21%)
• Negotiated a better price or contingencies on their current home (21%)
• Waited to buy a home until they had more money saved (16%)
• Paid for an inspection (15%)
• Purchased a less expensive home (14%)
• Waited until mortgage rates fell (14%)
• Waited to buy a home until prices declined (14%)

About 21% of homeowners say owning a house is not worth the cost, and 25% say homeownership hasn't been worth the hassle. 

46% of Recent Home Buyers Say They Overpaid

Americans who bought a home in 2023 or 2024 are nearly 3x more likely to say they overpaid than those who bought before 2010 — by a margin of 46% to 16%. All together, about 26% of homeowners say they overpaid.

More than a third of first-time home buyers (36%) were surprised by the expenses or fees that come with the closing process.

Homeownership can become more expensive for owners depending on their buying circumstances. About 31% of homeowners say they purchased a house that had been flipped. Of those, nearly half (48%) say the flipper cut corners on home maintenance. 

Estimating the cost of homeownership is always a challenge, especially in a hot market when spending too much time on due diligence could allow competing buyers to swoop in with a more compelling offer. About 42% of homeowners could not accurately estimate the cost of repairs and improvements before buying their home, including 48% of those who did not receive a home inspection.

Of those who were able to accurately estimate the costs, 52% say their real estate agent helped them determine that value. 

Some took precautions but still weren't able to avoid unexpected problems. About 65% of homeowners had their home inspected before buying. But 28% of those homeowners say their inspection wasn't effective in identifying potential maintenance and repair issues. 

Real Estate Witch's data suggests it's worth asking for concessions if you think the seller's home has outstanding maintenance problems. About 34% of buyers asked for concessions from the seller to pay for certain repairs or improvements to the property. Of that group, 77% say the seller granted at least one of their requests. 

Renter Envy: 28% of Homeowners Have Considered Going Back to Renting

Some Americans spend years dreaming of homeownership — only to regret that decision once they realize the drawbacks of reaching their goal. More than 1 in 4 homeowners (28%) say the high cost of owning a home makes them want to go back to renting. Nearly half of homeowners (49%) spend more money owning a home than they did when renting.

Homeowners say:

• They spend more owning a home than when renting (49%)
• They think it's easier to be a renter than a homeowner (42%)
• Renting is generally less expensive than owning a home (41%)
• They envy renters who don't have to pay for maintenance/upkeep (34%)
• The cost of owning a home has made them want to go back to renting (28%)

Many homeowners and renters think the grass is greener for their counterparts. Although our survey found that 42% of homeowners say it's easier to be a renter, another recent survey found that 54% of renters say it's easier to be a homeowner.

The Most Common Regrets for Homeowners

Homeownership comes with tangible benefits: autonomy over your own space and the opportunity for substantial home-value appreciation over time.

Despite these perks, two-thirds of homeowners (67%) have some regrets about their home purchase. That number rises to 82% among homeowners who purchased a fixer-upper. Among all homeowners, the most common regrets are:

• Their home is too small or lacks features they need (19%)
• Their home requires too much maintenance (18%)
• The location is not ideal (15%)
• Their monthly mortgage payments are too high (15%)
• They didn't ask enough questions/complete enough research before purchasing (14%)
• They bought a fixer-upper or older home (14%)
• They dislike their neighbors (14%)
• They were unprepared for hidden costs (13%)
• Their interest rate is too high (13%)
• They dislike their homeowners association (HOA) (13%)

Additionally, 43% say the cost of homeownership causes them stress, and 35% say they spend too much money on their home. In fact, a 2023 survey found one-third of homeowners (34%) say they would be less stressed if they didn't own a home. 

Maintenance Costs: Homeowners Spend $4,400 on Upkeep Each Year

One of the most common complaints among homeowners is the investment required to maintain their home. On average, homeowners spend $4,392 on maintenance and repairs each year. 

The high cost of maintenance leads many homeowners to short-change their upkeep needs. About 42% of homeowners say they've skipped a home repair or maintenance because they didn't have the money. About 38% say they've put off a major repair for more than a year.

One in 5 homeowners (20%) say they can't afford basic home maintenance, and 40% say the previous owner was not upfront about the cost of maintenance on the home.

The most common maintenance tasks homeowners have undertaken include:

• Painting and/or staining (54%)
• Major appliance replacement (e.g., washing machine, stove, dishwasher, etc.) (48%)
• Plumbing (e.g., leaky faucet) (46%)
• Water heater (43%)
• Roof (42%)
• HVAC (furnace/air conditioning) (39%)
• Electrical (33%)
• Major appliance repair (e.g., washing machine, stove, dishwasher, etc.) (32%)
• Gutters (31%)
• Sewer/water line (22%)
• Deck repair (21%)
• Moisture mitigation or water damage repair (17%)
• Foundation or structural issues (15%)
• Septic tank (14%)

Half of homeowners say they could not comfortably afford to spend $3,000 on an emergency home repair without going into credit card debt. About 19% can't afford a $500 repair without going into credit card debt. 

Homeowners Spend Nearly 600 Hours on Home Maintenance and Improvements Each Year 

Homeownership involves not only financial sacrifices, but it also takes up much of homeowners' free time. 

On average, homeowners say they spend 11.3 hours each week on home repairs, maintenance, and improvements — adding up to 588 hours per year, or 24.5 days. That means every 15 years, the typical homeowner loses a year of their life (365 days) to home upkeep and improvements. 

About 26% of homeowners spend at least 20 hours per week on home maintenance. 

Some homeowners are so worn down by their home maintenance obligations that they'd be willing to pay a massive premium for a maintenance-free home. About 35% of homeowners say they would have been willing to pay an extra $100,000 for a house that requires little to no upkeep. 

The Cost of Home Improvements: Homeowners Average $3,800 on Renovations 

Separate from regular maintenance and repair costs are payments toward home improvements — renovations or remodels that boost the quality and financial value of one's living space. 

Homeowners spend an average of $3,784 on renovations and improvements per year. About 35% of homeowners say they plan to spend at least $10,000 on renovations in 2024 alone. 

About 31% of homeowners say they've had a DIY renovation or repair disaster, including 44% of those who bought a fixer-upper. A quarter of homeowners (25%) have started a home renovation project they knew they couldn't afford. 

Over the next five years, about 91% of homeowners say they have a major renovation or improvement planned. The most common improvements homeowners are planning include:

• Painting (41%)
• New landscaping, fencing, and/or yard improvements (32%)
• Bathroom remodel (29%)
• Kitchen remodel (29%)
• New windows (27%)
• New or refinished flooring (26%)
• New or refinished patio, deck, and/or porch (23%)
• Bedroom or living room remodel (21%)
• Basement remodel (17%)
• New plumbing (16%)
• Pool installation (14%)
• Adding a room (13%)
• Adding a bathroom (13%)

About 51% of homeowners say they prioritize structural upgrades when making home improvements, while 27% put more emphasis on aesthetic improvements. 

Homeowners Spend Over $5,300 on Utilities 

The most expensive hidden cost of homeownership is the amount spent on utilities, such as electricity and water. Homeowners spend an average of $5,362 on utilities each year — 77% more than renters ($3,034). About 23% of homeowners say the cost of utilities has been more expensive than they expected. 

Because homes tend to have more appliances and more square footage than apartment units, they usually incur higher utility costs. However, utility costs are also rising faster for homeowners than renters. 

According to the most recent data from the Bureau of Labor Statistics, utility costs increased nearly twice as much for homeowners (11% increase) as they did for renters (6% increase) from 2020 to 2022 — the last full year for which data is available.

Homeowners Spend $4,420 on Taxes and Insurance 

Of all non-mortgage expenses associated with homeownership, homeowners often cite property taxes as the most surprising. U.S. homeowners typically spend $2,904 on property taxes and $1,516 on homeowners insurance each year — totaling $4,420.

About 94% of homeowners say their property taxes have increased since moving into their home, including 59% who say their property tax assessment has increased significantly since their home purchase.

Most homeowners (53%) say their property taxes have risen by at least 20%. About 11% of homeowners say their taxes have increased by 50% since moving in.

The states with the highest property tax bills are:

• New Jersey ($8,897)
• New Hampshire ($6,209)
• Connecticut ($6,189)
• New York ($6,180)
• Massachusetts ($5,536)

The states with the lowest property tax bills are:

• Alabama ($718)
• West Virginia ($821)
• Arkansas ($977)
• Louisiana ($1,127)
• Mississippi ($1,161)

The states with the most expensive homeowners insurance are:

• Colorado ($2,900)
• Nebraska ($2,554)
• Texas ($2,536)
• Oklahoma ($2,278)
• Kansas ($2,265)

The states with the least expensive homeowners insurance are: 

• Vermont ($680)
• Pennsylvania ($736)
• New Hampshire ($801)
• Delaware ($835)
• Wisconsin ($846)

In addition to paying for homeowners insurance, about 31% of homeowners surveyed still pay for private mortgage insurance (PMI), which is required for those who make a down payment of less than 20% of the home's purchase price. 

The Cost of HOA Fees 

Another hidden expense of homeownership is the cost of homeowners association (HOA) fees. More than half of homeowners (56%) pay additional fees to an HOA. 

Among those with an HOA, most (51%) pay at least $300 a month, including 13% who spend at least $500 per month — $12,000 per year. 

About 21% of those who pay these fees say they dislike their HOA. 

• 25% say their HOA fees are higher than expected
• 37% have been told by their HOA that they can't make a certain renovation or improvement to their property

About 76% of homeowners surveyed also care for a lawn, which can cost hundreds of dollars per month. 

Methodology

The proprietary data featured in this study comes from an online survey commissioned by Real Estate Witch. One thousand U.S. homeowners were surveyed Feb. 1-2, 2024. Each respondent answered 25 questions related to homeownership and their financial situation.

About Real Estate Witch

You shouldn’t need a crystal ball or magical powers to understand real estate. Since 2016, Real Estate Witch has demystified real estate through in-depth guides, honest company reviews, and data-driven research. In 2020, Real Estate Witch was acquired by Clever Real Estate, a free agent-matching service that has helped consumers save more than $160 million on Realtor fees. Real Estate Witch's research has been featured in CNBC, Yahoo! Finance, Chicago Tribune, Black Enterprise, and more.

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