When You Buy a House What Do You Pay Monthly?

David Dorman on September 1, 2021

With rental prices in Central Florida rising at a faster rate than the typical renters’ paycheck, more Floridians are realizing the best way to control the cost of living is to own a home. Current low interest rates make the prospect even more attractive. Yet, many first-time buyers aren’t aware of the many expenses involved in homeownership. Here is a comprehensive list of monthly house payments every new purchaser in Florida should anticipate.

Biggest Monthly House Payments: Mortgage

Clearly, your monthly mortgage payment is the elephant in the room. As the biggest expense tied to homeownership, every buyer wants to know their potential payment. The National Association of Realtors estimated $272,500 to be the national median price for a home in 2020. Assuming a 10% down payment, that calculates to $1,700/mo on a 30-year, 3.29% fixed-rate mortgage and $2,276/mo over 15 years at a 2.79% fixed rate.
The average first-time buyer purchasing a $200,000 home on the same terms nationally can anticipate monthly payments of $1,307 and $1,760 respectively. In Orlando, the typical mid-priced home sells for $292,716. Before deciding if any payment fits within their budget, however, every home-buyer should factor in the other expenses. Keep in mind that refinancing is an option, too and that most homeowners don’t stay with their original loan for more than ten years.

Basic Utilities

Electricity

In 2019, the US Energy Information Administration released a report stating the average Florida resident paid $126.44 for electricity every month. With the need for air conditioning, it shouldn’t come as a shock that is 13% higher than the national average. Additionally, homes consume more electricity than apartments. They come with more appliances, exterior lighting, an automatic garage door opener, and, sometimes, a pool filter.

Other factors affect your monthly bill. The age and condition of the home matter, as do the age, condition, and types of appliances. The efficiency of the HVAC unit is critical. One that performs poorly will increase your bill unnecessarily. Switching from incandescent to LED light bulbs significantly reduces your power consumption. You can find apps online that estimate electric bills and power usage based on the home address.

Water

Like electricity, water and sewage bills vary depending on certain factors. How many residents are there? How much lawn and garden is there to water? How many cars to wash? Is there a pool or jacuzzi? In Orange County, your electric, water, and sewage bills are bundled by the Orlando Utilities Commission, whereas other Floridian municipalities may bill separately.

According to the Orlando Sentinel, a typical household in the region uses 6,000 gallons of water and wastewater services each month. Billing ranges from $67 to $95 depending on the specific location and utility company.

Garbage

The Orlando Solid Waste Division provides curbside pickup for solid waste, recyclables, and yard waste. They will also schedule free pick-up for large items, such as old washers, dryers, and dishwashers that do not fit in your waste bin. According to Orlando.Gov, the standard fee for monthly trash service is $19.28

Cable And Internet

In Winter Park and Orlando, Spectrum and Xfinity are the two cable television providers. Service plans from the two companies range from $30 to $153. Additionally, DIRECTV offers satellite television, while AT&T and CenturyLink feature IPTV and Fibre TV services. Each company also offers internet service. Summit Broadband is making inroads in the area, providing cable and internet service to roughly two percent of households in the two cities.

Maintenance Costs

Lawn Care And Landscaping

One major transition for new homeowners is the difference between watering a few houseplants and caring for front and backyard lawns and gardens. Thankfully, dozens of reputable lawn service and landscaping companies in the greater Orlando area can ease your burden.

Services include regular mowing, tree and hedge trimming, fertilizing, and planting and maintaining flower beds. Cost depends on services rendered and square footage. According to Manta.com, the price range for simple mowing services in Orlando ranges from $11 to $55 monthly.

Sprinkler System

Most Orlando area homes have irrigation systems in place. If the home you purchase doesn’t, it’s another expense. The typical cost for a four-zone system that covers the average yard is $3,000. It’s a good investment in terms of time-saving and preserving property value. Like many other home upgrades, it can be financed and paid monthly.

Pool Cleaning

If your new home has a pool, but your schedule doesn’t allow time to both enjoy and maintain it, you may opt for a cleaning service. Single visits range from $20 to $30, but you can save as much as 15% by paying monthly for weekly visits. Professional pool cleaners keep your PH balance optimal, skim away accumulated debris or algae, and, for additional fees, winterize your pool, and inspect, replace and/or repair pumps and filters.

Protecting Your Investment

Home Security

When you buy a home, you naturally want to protect it. There are several home security services on the market. Features include contact alarms for windows and doors, motion sensors, motion-activated cameras, and 24-hour access to live operators if an emergency does occur. Many systems can be controlled via your smartphone or laptop while away from home, which is handy when you’re expecting a package to be delivered.

The major cost is installing the system. Typically, installation charges range anywhere from $500 to $800. Charges do not include local permit, inspection, or building fees. Applicable Orlando, Orange County, and Florida sales taxes are also extra, as is the roughly $100 surcharge if circumstances require a general contractor. Most companies allow the homeowner to finance the charge. Once the system is installed, monthly monitoring costs tend to fall between $15 and $30.

Homeowner’s Insurance

Overall, Florida weather is beautiful. New residents flock to the state annually. Unfortunately, with thousands of miles of coastal area, Florida is also subject to catastrophic weather. Situated mid-state, Orlando is comparatively safe from hurricanes and tropical storms, but only if you understand that “comparatively” is the operative word. Beyond insuring your home and belongings against fire, lightning, and theft, it’s imperative that you protect yourself against damages from flood and wind.

For all that, BankRate.com reports that the average annual home insurance premium in the state is $1,353, only $40 above the national average. Again, because Orlando is centrally located, slightly mitigating risk from torrential storms, local homeowner premiums tend to be lower than those in coastal cities.

Community Costs

Homeowners And Condo Association Fees

If you purchase a residence within an HOA or Condominium Association’s jurisdiction, the bad news is you will be required to pay a regular fee. Depending on the association, it is collected either monthly or quarterly. The good news is the fee can cover expenses such as trash collection and landscaping, mitigating and sometimes eliminating other monthly expenses listed above.

Association fees also cover costs for regular maintenance of community buildings, staff, security, and signage. Fees vary according to the size of the association’s jurisdiction, number of members served, and services provided. It’s important to know that associations can also assess much larger one-time fees for larger projects such as roofing, painting, and other upgrades approved by the majority of members.

Property Taxes

Whether you live in an association or independently, property taxes are unavoidable. Municipal, county, and regional governments derive the greater part of their revenue from property taxes. Your contribution funds various services including, but not limited to public schools, police, fire, and emergency services, and maintenance of streets and parks. Orange County’s median property tax is $2,152 per year.

County property taxes are assessed on a millage system. They’re prorated according to property value. Lots with greater value pay higher rates. Again, the good news is that the system has safeguards preventing your taxes from increasing more than three percent annually. When a home is purchased, up to six months of taxes can be collected in advance. Beyond that, they are collected yearly, although the City of Orlando does permit qualified residents to pay quarterly installments.

Improving Property Value

Most of the monthly expenses covered to this point are either necessary or commonly taken on by homeowners. Beyond that, homeowners may wish to increase their property value by renovating or upgrading the house or land. There are several projects that can be undertaken to achieve that aim. Each involves a significant investment, although some cost noticeably more than others. The one thing they all have in common is that the expense can be financed monthly.

Here are just a few possibilities to improve the value of your home.

Roofing

Repairing or installing a new roof can lower your electric bill, prevent water damage and provide greater protection from inclement weather.

Fencing

Erecting a new fence around your property can provide additional security and improve the appearance of the property, thereby raising its value.

Decking

Installing a new deck in the backyard not only offers your family additional space to enjoy their new home, it makes the home more attractive to potential buyers when you decide to sell.

Paint

It’s amazing how a fresh coat of paint can make your house stand out in the neighborhood.

While the fact is that homeownership is a better long-term investment than renting in terms of a lower, recoverable cost, there are many monthly house payments attached to that investment of which new owners should be aware while planning their purchase. A qualified realtor can help. Contact David Dorman if you’re looking for your first home in the Orlando area.