A new analysis from Zillow and Thumbtack finds that the hidden costs of homeownership nationwide have climbed to nearly $16,000 annually, rising faster than most incomes and putting additional strain on affordability.
The study estimates that the typical homeowner now spends $15,979 annually — or roughly $1,325 per month — on expenses beyond the average mortgage payment on additional costs such as $10,946 in maintenance, $2,003 in homeowner’s insurance, and $3,030 in property taxes. Together, these hidden costs are up 4.7% year-over-year, outpacing the 3.8% rise in household incomes during the same period.
The report found that the squeeze of these hidden costs were the sharpest in high-cost coastal metros, including $24,381 in New York City; $22,781 in San Francisco; and $21,320 in Boston.
And the major culprit in driving these costs were found to be home insurance premiums, a hidden cost to homeownership that has surged 48% nationwide since February 2020. The typical annual home insurance premium now exceeds $2,000, but in Miami, Florida, costs average $4,607, up 72% in just over a five-year span. Florida metros, including Jacksonville, Tampa, and Orlando have seen similar spikes. Outside of the Sunshine State, home insurance premiums have jumped 79% in New Orleans, 59% in Sacramento, and 58% in Atlanta.
"Insurance costs are rising nearly twice as fast as homeowner incomes," said Kara Ng, Zillow senior economist. "It's not just a budget line item. It's a barrier to entry for aspiring first-time buyers and for families already stretched thin. Buyers who are already facing affordability challenges in today's market need to understand and budget for these less obvious expenses when calculating how much home they can truly afford."
For the analysis, Zillow estimated annual property tax and homeowners insurance costs for a typical U.S. homeowner, then compared year-over-year changes and pre-pandemic benchmarks. Thumbtack added estimates for annual costs of home maintenance, plus preventive weather-related maintenance projects.
Thumbtack's essential annual costs of home maintenance include: appliance maintenance, carpet cleaning, central air conditioning maintenance, deck staining and sealing, duct and vent cleaning, fireplace and chimney cleaning, full-service lawn care, gutter cleaning and maintenance, heating system maintenance, house cleaning, pressure washing, roof maintenance, sprinkler and irrigation system maintenance, tile and grout cleaning, tree trimming and removal, water heater maintenance, and window cleaning.
“Home maintenance is often one of the most overlooked parts of owning a home,” said Morgan Olsen, Thumbtack home expert. “Preventative maintenance acts as a safety net — spending a little each season helps homeowners avoid big surprises later.”
