3 ways to keep your ownership cost down!

If you own a home or are about to buy one, you can take many steps to keep your ownership costs down and under control without neglecting your property or living like a pauper. The following sections are my tips.

Buy a home that fits your budget

Purchase a home that you can afford. During the booming real estate market of the early to mid-2000s, getting overextended with debt was pretty easy. You didn’t need a decent-size down payment or even have to have your income verified to buy a home if you made a larger down payment. Furthermore, interest-only loans allowed borrowers to shrink their mortgage payments by delaying repayment of any of their principal.

I was never a fan of such loans, which is why in bestselling book Home Buying For Dummies (Wiley), coauthor Ray Brown advise that the best way to buy a home is to examine your budget and financial resources before shopping for a home. As the real estate market crashed in the late 2000s, some of those people who bought homes that stretched their budgets lost their homes to foreclosure because they got in over their head, fell on hard times, and couldn’t afford their monthly mortgage payments.

Remember:Even if you can afford the monthly mortgage payment on a house you’re looking to buy, if you have too little money left over for your other needs and wants — such as taking trips, eating out, going to concerts, enjoying hobbies, or saving for retirement — your dream home may become a financial prison.

Get a roommate (and some rental income)

Owning a home can be much more affordable if you have some monthly rental coming in. Consider renting a bedroom to a roommate who can pay monthly rent as well as help with utilities.

Tips:If you decide to get a roommate, make sure that you check the renter thoroughly through references and a credit report, and be sure to discuss ground rules and expectations before sharing your space. Also, ask your insurance company to see whether your homeowner’s policy needs adjustments to cover potential liability from renting.

Contain your utility costs

You can take steps to keep your utility costs down whether you own or rent a home. First, don’t waste energy, even if you don’t pay for it out of pocket as a renter. Landlords absolutely factor your energy consumption into future rental-hike decisions. Paying for your own utilities should get you to consider wearing layers in the winter and not expecting your home to feel like a meat locker in the heat of summer.

Especially if you have to pay for garbage service, recycle as much as possible. Seek the replacement of old, energy-guzzling appliances and where possible, beef up your property’s insulation. Obviously, if you’re a renter, you have no control over these things but you should certainly ask.