Full Breakdown
Rising Hidden Costs of Homeownership in the U.S.
11/17/2025, 2:29:04 AM
Overview of Hidden Costs
A recent analysis by Zillow and Thumbtack reveals that the hidden costs of homeownership in the United States have surged to nearly $16,000 annually, averaging about $1,332 per month. This figure includes expenses beyond mortgage payments, such as maintenance, property taxes, and homeowners insurance. Specifically, homeowners are now facing approximately $10,946 in maintenance costs, $3,030 in property taxes, and $2,003 in homeowners insurance. These costs have increased significantly, with the total rising from $14,155 in 2023 and $9,080 in 2017.
Financial Implications
The report highlights that these rising costs are outpacing household income growth, which increased by only 3.8% over the past year compared to a 4.7% rise in hidden homeownership costs. This financial strain is particularly acute in major metropolitan areas, where the average hidden costs are significantly higher. For instance, homeowners in New York City face an average of $24,381 annually, while those in San Francisco and Boston pay $22,781 and $21,320, respectively.
Regional Variations in Costs
Florida has been particularly affected by rising insurance premiums, with Miami seeing an increase of 72% since 2020, bringing the average annual premium to $4,607. Other cities in Florida, such as Jacksonville, Tampa, and Orlando, have experienced similar spikes. Outside of Florida, notable increases include 79% in New Orleans, 59% in Sacramento, and 58% in Atlanta. Zillow attributes much of this increase to homeowners insurance, which has risen nearly 48% nationally since early 2020.
Expert Insights
Morgan Olsen, a home expert at Thumbtack, emphasized the importance of budgeting for maintenance, stating, “Think of preventative maintenance as a safety net for your biggest asset.” Kara Ng, a senior economist at Zillow, noted that the rapid rise in insurance costs poses a significant barrier for first-time buyers and families already facing financial pressures. She remarked, “It’s not just a budget line item. It’s a barrier to entry for aspiring first-time buyers.”
Recommendations for Prospective Homeowners
In light of these findings, Zillow advises prospective homeowners to assess their true buying power before committing to a property. They recommend planning for maintenance costs early and considering new-construction homes to avoid unexpected repairs. Additionally, buyers should evaluate the type of home they are interested in, as larger single-family homes typically incur higher upkeep costs compared to townhomes or condos.
Conclusion
The analysis by Zillow and Thumbtack underscores the growing financial burden of homeownership in the U.S., driven by hidden costs that are increasingly outpacing income growth. As these expenses continue to rise, they present significant challenges for current and prospective homeowners, particularly in high-cost urban areas.
