Hidden Costs of Buying a Home: Most Buyers Miss

What You Need to Budget for Beyond the Down Payment

Buying a home is one of the most exciting—and expensive—milestones in life. Most buyers prepare for the big numbers like the down payment and monthly mortgage, but many are surprised by the hidden costs that come up along the way.

If you're planning to buy a home, here are the common (and often overlooked) costs you should be ready for:

1. Closing Costs (2%–5% of Home Price)

Closing costs can quickly add up and typically include:

• Lender fees

• Appraisal fee

• Title insurance

• Escrow or attorney fees

• Recording and transfer taxes

• Prepaid taxes and homeowners' insurance

Tip: Ask your lender for a Loan Estimate early on to see a detailed breakdown of these costs.

2. Home Inspection and Appraisal Fees

While not always required, these services are strongly recommended:

• Home Inspection: ₱5,000–₱15,000

• Appraisal Fee: ₱10,000–₱20,000

These are usually paid upfront, not rolled into your mortgage.

3. Property Taxes and Insurance Escrow

Even if your mortgage includes escrow, you’ll need to prepay a portion of your property taxes and homeowners' insurance at closing. This can be a significant lump sum.

Example: You might need to prepay 6–12 months of taxes or premiums, depending on your lender's requirements.

4. HOA Fees or Community Dues

Buying in a condo, subdivision, or gated community? Be prepared for:

• Monthly, quarterly, or annual HOA dues

• One-time initiation or transfer fees

Tip: Always request a copy of the HOA rules and financials before making an offer.

5. 🪛 Immediate Repairs and Maintenance

Even well-maintained homes may need:

• Lock changes

• Paint touch-ups

• Minor plumbing or appliance repairs

And if you're buying an older home? Budget for updates or surprise fixes post-move-in.

6. Moving Costs

Hiring movers, renting a truck, or even doing it yourself involves costs:

• Professional movers: ₱10,000–₱50,000+ depending on distance

• Packing supplies, boxes, and temporary storage

• Time off work, fuel, or meals during the move

7. Utility Setups and Deposits

Setting up electricity, water, internet, and other services often requires connection fees or security deposits, especially if you're a new customer or have no prior payment history.

8. New Furniture and Appliances

Many buyers don’t realize until after the sale that their current furniture may not fit, or the home doesn’t include certain appliances (like a washer, dryer, or refrigerator).

Tip: Walk through the home and make a checklist of what you'll need to buy right away.

Final Thoughts

Buying a home involves more than just your mortgage and down payment. By planning ahead for these hidden costs, you’ll avoid surprises and feel more confident about your investment.

Thinking about buying a home? I’d be happy to walk you through the full financial picture and help you plan wisely—reach out anytime!