5 Ways to Reduce Home Insurance Costs When Building a Home
Home ownership is one of the most exciting prospects, regardless of your age, family status, or position. However, the excitement of moving into and decorating your new abode can be quickly dampened by any number of surprising expenses.
- Household Systems: When you move into a new home, you expect all of the major systems to work: heating, air conditioning, electrical, and plumbing. After all, there has been a home inspection prior to signing your closing documents. If your home is brand new, though, the systems may be tested briefly to assure function. However, anything new is susceptible to fault, and repair costs can be steep. An older home is even more prone to these types of malfunctions. You may think everything is fine, and then observe evidence of a water leak. The warm weather arrives, and you discover that the air conditioner isn’t functioning correctly. Regardless of the issue, the expenses can be steep, and inconvenient if most of your resources have gone into buying the home.For rural homes, these expenses can be very high. With a burned out well pump, or saturated leach field, you can be looking at thousands of dollars in repairs. There are plenty of surprises, and it’s good to plan for unexpected situations.
- Household Fixtures and Appliances: The new home will be less prone to the need for unexpected replacement of major appliances and fixtures, but eventually, there will be malfunctions. In an older home, you will be likely to deal with these issues much sooner. While it’s not difficult to list the obvious appliances, such as refrigerator, washer, dryer, and dishwasher, you may not have considered the garage door opener or water heater. A home warranty will cover some but not all of these if included in your closing deal. However, once the warranty expires, the brunt of these expenses falls completely on the homeowner.Carpeting, molding, faucets, toilets, and more, are susceptible to aging, and may present varied repair costs. Planning your budget to accommodate household upkeep should include the anticipation of this normal wear and tear.
- Storm and Weather Damage: Extremes in weather aren’t always able to be anticipated. Neither is the resulting damage able to be predicted. Wind, snow, rain, flooding: each can result in serious damages. Generally, homeowners insurance covers weather-related damage, but in the case of some natural hazards or disasters, specific coverage must be purchased. Flood insurance, for example, is not a given, and if not included in your policy, not covered. The costs, in these instances, may not only be surprising, but devastating. Another such instance is earthquake insurance.
- Basic Maintenance: Upkeep of a house can be surprising, in terms of expense. Of course, simple household maintenance isn’t new. However, a variety of indoor and outdoor tools and costs inevitably become necessary for exterior and landscape upkeep. Painting, planting, mowing, and tree-trimming each require specific equipment and supplies, and while these will vary based on your individual needs and location, you may be caught off guard at the costs. These are often far from mind when you are closing your deal to buy your home.
- Services and Utilities: If you previously rented, you undoubtedly had responsibility for utilities, to some degree. However, as a homeowner, you will find yourself responsible for all of the utilities and services. Deposits are required by some utility companies, computed according to average billing for the property. Some utilities will waive security deposits for new homeowners, unless the individual has a poor credit history in previous dealings with the entity. Sewage and trash collection are a couple of unexpected utilities that are the responsibility of a homeowner, but not necessarily assigned to renters. Homeowners association fees can be unexpected, especially if a system of fines is in place for offenses against association rules. Know your association policies as well, so that you know issues that could result in those surprise fines.