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5 Hidden Costs of New Homes All Buyers Should Know

5 Hidden Costs of New Homes All Buyers Should Know

Buying a home is a daunting prospect for many, but it is a well-known truism that it is better to buy a home than rent one. When you rent a place, you are just throwing money away while buying a home is an investment that will hopefully pay off.

But that comforting logic starts to fall short when you consider the hidden costs of owning a home. Just as an individual moving out of his parents’ home must deal with responsibilities he never considered before – like cooking – a homeowner must consider additional costs and expenses that he did not have to worry about when renting. Here are five such expenses to consider and advice on how you can reduce their cost.

1. Home inspections

The first hidden costs show up before you even close a deal. You can take a look at the house all you want beforehand, but many lenders will require you to hire a professional home inspector before you sign. Even if the lender does not, you should hire one anyways. A professional home inspector can make sure that your home does not have any sudden surprises such as poor wiring or a termite infestation, and require that the seller fixes those problems.

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Hiring a professional home inspector can cost a couple hundred dollars, but it can save you a great deal and prevent you from buying a faulty home. Just be prepared to eat the initial expense.

2. Closing costs

You inspected the home, found that everything is good, and have your offer accepted. Then you find out that you have to pay an additional few thousand dollars up front in the form of closing costs. Closing costs are additional fees such as escrow fees, attorney fees, and other expenses that are usually on the buyer. Zillow states that the average buyer pays about $3,700 in closing fees.

While it is not possible for a buyer to completely avoid these costs, it can be lowered. Shop around with multiple lenders to try and get the best deal on your mortgage and ask if the seller may be willing to cover some of the costs.

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3. Moving

You may be able to get out of moving expenses if you have a wide cadre of friends willing to help you out and if your home is nearby. But the odds are that you are going to have to hire a moving company. If you rely on a professional moving company, then the average cost of moving out of state is over $4,000

If you are moving a long way and want to budget, then you can lower the costs by making sure you are only moving the essentials and possibly taking care of the move yourself with a U-Haul truck. But be prepared to pay a few extra thousand dollars for a clean move without chaos.

4. Maintaining your home and yard

One of the biggest changes towards owning a home is the fact that when something goes broke, it is on you and not the landlord to fix things. And there is always something that needs to be improved or fixed.

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You may be willing to mow the lawn and take care of the yard work yourself. However, that still entails the cost of purchasing the necessary equipment yourself as well as the time needed to mow the lawn and so on. Then there are other expenses such as fixing your heating, air conditioning, and plumbing. While it is possible to handle issues like this if you really know what you are doing, it is just as likely that you burst a main and lose far more money in the resulting repair costs.

You do not want to skimp on home repairs if you want to uphold its value, so budget a certain amount of money every year for repairs. There are a few guides for how much to save, but you should generally be looking to save something around one percent of the home’s value every year.

5. Property Taxes

Death, taxes, you know the saying. But what you may not know is that your mortgage’s monthly bill will also account for property taxes and homeowner’s insurance. This is especially true if you’re looking to earn an investment with a 1031 exchange property. If you use an escrow account, which is required if your down payment is less than 20 percent of the home’s value, then you don’t pay your property taxes directly. Instead, you send your money to a mortgage company who pays your taxes for you. And there is also the scenario where you can be hit with a payment for a couple months’ worth of property taxes right when you move in.

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Dealing with property taxes can be incredibly confusing and varies from area to area. The best advice is to be prepared and talk with your mortgage company about how much you will have to pay as well as any potential surprises.

Featured photo credit: Moyan Benn via flickr.com

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Last Updated on March 13, 2019

How to Get out of a Rut: 12 Useful Ways to Get Unstuck

How to Get out of a Rut: 12 Useful Ways to Get Unstuck

Have you gotten into a rut before? Or are you in a rut right now?

You know you’re in a rut when you run out of ideas and inspiration. I personally see a rut as a productivity vacuum. It might very well be a reason why you aren’t getting results. Even as you spend more time on your work, you can’t seem to get anything constructive done. While I’m normally productive, I get into occasional ruts (especially when I’ve been working back-to-back without rest). During those times, I can spend an entire day in front of the computer and get nothing done. It can be quite frustrating.

Over time, I have tried and found several methods that are helpful to pull me out of a rut. If you experience ruts too, whether as a working professional, a writer, a blogger, a student or other work, you will find these useful. Here are 12 of my personal tips to get out of ruts:

1. Work on the small tasks.

When you are in a rut, tackle it by starting small. Clear away your smaller tasks which have been piling up. Reply to your emails, organize your documents, declutter your work space, and reply to private messages.

Whenever I finish doing that, I generate a positive momentum which I bring forward to my work.

2. Take a break from your work desk.

Get yourself away from your desk and go take a walk. Go to the washroom, walk around the office, go out and get a snack.

Your mind is too bogged down and needs some airing. Sometimes I get new ideas right after I walk away from my computer.

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3. Upgrade yourself

Take the down time to upgrade yourself. Go to a seminar. Read up on new materials (#7). Pick up a new language. Or any of the 42 ways here to improve yourself.

The modern computer uses different typefaces because Steve Jobs dropped in on a calligraphy class back in college. How’s that for inspiration?

4. Talk to a friend.

Talk to someone and get your mind off work for a while.

Talk about anything, from casual chatting to a deep conversation about something you really care about. You will be surprised at how the short encounter can be rejuvenating in its own way.

5. Forget about trying to be perfect.

If you are in a rut, the last thing you want to do is step on your own toes with perfectionist tendencies.

Just start small. Do what you can, at your own pace. Let yourself make mistakes.

Soon, a little trickle of inspiration will come. And then it’ll build up with more trickles. Before you know it, you have a whole stream of ideas.

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6. Paint a vision to work towards.

If you are continuously getting in a rut with your work, maybe there’s no vision inspiring you to move forward.

Think about why you are doing this, and what you are doing it for. What is the end vision in mind?

Make it as vivid as possible. Make sure it’s a vision that inspires you and use that to trigger you to action.

7. Read a book (or blog).

The things we read are like food to our brain. If you are out of ideas, it’s time to feed your brain with great materials.

Here’s a list of 40 books you can start off with. Stock your browser with only the feeds of high quality blogs, such as Lifehack.org, DumbLittleMan, Seth Godin’s Blog, Tim Ferris’ Blog, Zen Habits or The Personal Excellence Blog.

Check out the best selling books; those are generally packed with great wisdom.

8. Have a quick nap.

If you are at home, take a quick nap for about 20-30 minutes. This clears up your mind and gives you a quick boost. Nothing quite like starting off on a fresh start after catching up on sleep.

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9. Remember why you are doing this.

Sometimes we lose sight of why we do what we do, and after a while we become jaded. A quick refresher on why you even started on this project will help.

What were you thinking when you thought of doing this? Retrace your thoughts back to that moment. Recall why you are doing this. Then reconnect with your muse.

10. Find some competition.

Nothing quite like healthy competition to spur us forward. If you are out of ideas, then check up on what people are doing in your space.

Colleagues at work, competitors in the industry, competitors’ products and websites, networking conventions.. you get the drill.

11. Go exercise.

Since you are not making headway at work, might as well spend the time shaping yourself up.

Sometimes we work so much that we neglect our health and fitness. Go jog, swim, cycle, whichever exercise you prefer.

As you improve your physical health, your mental health will improve, too. The different facets of ourselves are all interlinked.

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Here’re 15 Tips to Restart the Exercise Habit (and How to Keep It).

12. Take a good break.

Ruts are usually signs that you have been working too long and too hard. It’s time to get a break.

Beyond the quick tips above, arrange for a 1-day or 2-days of break from your work. Don’t check your (work) emails or do anything work-related. Relax and do your favorite activities. You will return to your work recharged and ready to start.

Contrary to popular belief, the world will not end from taking a break from your work. In fact, you will be much more ready to make an impact after proper rest. My best ideas and inspiration always hit me whenever I’m away from my work.

Take a look at this to learn the importance of rest: The Importance of Scheduling Downtime

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Featured photo credit: Joshua Earle via unsplash.com

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