I see a lot of questions here about buying homes, so I figured I would make a list of all the costs of owning a home to help first time home-buyers with budgeting. Some expenses are harder to predict than others (maintenance costs are hard to predict, a mortgage payment quite easy). While there could be other expenses, I will list the common ones, describe what they are and how you can estimate them before purchasing a home.

1. Mortgage payments – mortgage payments are the payments for the loan you took to buy the home. If you bought the home in cash or paid off your loan, you will no longer have mortgage payments. You can estimate your mortgage payments by using a mortgage payment calculator. Mortgage rates vary by region and things like your credit and whether or not the mortgage is insured. You should be able to find a rough estimate online for budgeting and then get a real number upon mortgage pre-approval that you can use to ensure your budgeting still holds up.
2. Utilities – Utilities for a home include water/sewage, natural gas, electricity (hydro), garbage/recycling removal, and (while not really a home utility, you might as well include them just to get a more accurate idea for monthly spending) internet/TV. Every home will have different utility bills due to how much the owners use and how the house is built (better insulation = lower natural gas bill in winter). The best way to estimate utility bills is to get recent bills for the home from the current owner. Sometimes utilities are included in the condo/strata fees of a home, I will go over condo fees next.
3. Condo/Strata/HOA fees – These fees should usually be included with the listing of a property, but it is important to verify whether or not you will have to pay them or not as even single-family homes can have Home-owners association (HOA) fees. The fees can cover a variety of things such as: exterior maintenance, some utilities, insurance for the building, services such as snow removal and more. What the fees cover is also sometimes included on the listing of the property, but again it is important to verify it by getting the proper documentation from the owner.
4. Insurance – Like any other insurance, this covers you from damages to your property for a variety of things. Depending on the different coverages you choose, your location and, deductible, insurance prices can vary widely. To estimate insurance costs, you can call insurance companies to get an estimate, however they often are quite difficult to get numbers from until you have an accepted offer on the property. You can also ask the current owner for an idea, but as I said, what they have chosen for coverage could change the costs quite a bit.
5. Property taxes – Most properties require you to pay a tax for owning them. Property listings often show this, but again, asking the owner for a recent tax assessment is the best way to estimate this expense.
6. Maintenance – Maintenance is very hard to predict. One rule of thumb is to budget for 1% of the homes value annually. While over the long run this may work out, if you are buying a home behind on maintenance (or with things you just want to change) it could be much more in the early years. It is important to evaluate the life expectancy for the bigger items in a home so you aren’t stuck with big unexpected bills. Things like the roof (shingles) needing to be redone can easily run you $5,000+ and is quite easy to see how worn they are and if it will be required soon. Paying attention to the age of the furnace and hot water tank is also a good idea. If they are original in a 30+ year old home, they might need to be replaced sooner rather than later.
7. Equipment rentals – Sometimes when buying a home you can be on the hook for taking the rental contract for things in the house. This can be for things like hot water tanks and security systems. The owner will have the information for these things. Hot water tanks especially seems to be a predatory business that you should avoid if you can.

A lot of the expenses require asking the seller of the home for information and that is quite inconvenient. Fortunately, these costs don’t vary an extreme amount between homes of similar value (except maybe maintenance) and type (single family, duplex, condo). For this reason, you can estimate them once for homes in the price range you are looking at to determine affordability. When you find a house you are serious about, you can then do an estimation for that house specifically to make sure there are no surprises and the house still falls in your affordability range.

To help get a complete view of expenses, I’ll show a realistic example of what expenses would look like for a Duplex and Condo in Edmonton.

Duplex:

Mortgage – Cost of the Duplex is $400k, with 5% down this comes out to $1,770/month at a 2.5% interest rate over 25 years.

Utilities – Utilities in Edmonton cost roughly $400/month for gas, power, water/sewage and garbage. With internet included this would be $450-$500/month.

Condo/Strata/HOA – This Duplex has no HOA or condo fees, but many do so make sure you clarify when purchasing. $0.

Insurance – Insurance costs are roughly $150/month depending on the coverage you choose.

Property Tax – Property tax is just under $3,000/year, so about $250/month.

Maintenance – The rule of thumb for maintenance is 1% of purchase price/year, but this is a newer duplex so less maintenance will be required for a long time. I’ll use 0.5% instead and this comes out to about $175/month.

Equipment Rentals – There are no equipment rentals in this duplex. $0

Total – $1,770 + $450 + $0 + $150 + $250 + $175 + $0 = $2,795/month.

Condo:

Mortgage – Cost of condo is $185k, with 5% down this comes out to $819/month at a 2.5% interest rate over 25 years.

Utilities – The only utility required for this condo is power. This is roughly $80/month. With internet it would be roughly $150/month.

Condo/Strata/HOA – The condo/strata fees for this unit are $315/month. They cover exterior maintenance, snow/lawn care, gas, water/sewage, garbage, and building insurance.

Insurance – The building is covered, but individuals still require insurance to pay the building insurance deductible should they be liable for damages caused to the building. You can also get insurance to cover the contents of your home. This insurance is fairly cheap, $25/month.

Property Tax – The property tax for this condo is $140/month.

Maintenance – Again, the rule of thumb is 1%, but exterior maintenance is covered under condo fees and there really isn’t that much to break inside a condo. We’ll use 0.5% again, this comes out to $75/month.

Equipment Rentals – There are no rentals in this condo.

Total – $819 + $150 + $315 + $25 + $140 + $75 + $0 = $1,524/month.

Hope this helps any soon-to-be home owners out there!