What Are the Costs of Homeownership in Virginia?

Virginia's various landscapes, ranging from the Appalachian Mountains to the Chesapeake Bay, offer several options for outdoor leisure and exploration. However, the expense of homeownership in Virginia might be high. Prices have continued to rise, and the average price per home in the state is above $300,000 which puts a considerable number of households out of reach. Also, those residing in Virginia encounter relatively high property taxes in comparison with people from other states depending on the county or city they live in.

Other expenses that may be incurred are related to closing the property, home inspection and appraisals, utility and maintenance costs, and home insurance, etc. It is important for those planning to buy homes to fully consider these expenses to be able to adequately proceed with the responsibilities of owning a home in Virginia.

Closing Costs

Possibly, the largest non-recurring expense, borne directly by the buyer is the closing costs to be paid upon transferring the residence. According to the most recent information, these expenses may exceed $2,000 to $5,000 of the price of the house, which depends on the details of the purchase. For instance, closing costs include $10,000 – $25,000 for every $500,000 in sales price.

They include loan origination charges (if you are obtaining a loan), attorney’s costs, title searches, and title insurance. It’s important to note that the state and county taxes also need to be taken into account, and these are typically based on the county you are in and will be a percentage of the purchase price. These are non-negotiable and apply to both the buyer and the seller. Your local realtor will be able to assist you in determining how much your home purchase or home sale will cost by providing you with an “estimated cost of settlement”.

Home Inspection and Appraisal costs

To ensure that a certain home is in good condition before making the final decision to buy it, it may be wise to make a physical inspection as well as an appraisal. There has been a slight increase in the fees charged in home inspections across Northern Virginia as the market has truly become more competitive, and in the process of working, a lot of detail has to be incorporated.

Presently, consumers are charged between $350 to $800 for the services of a home inspector. The costs of appraisal have also increased to an average of $600 to $700, which has arisen from rising price oscillations that require the appraiser to come up with accurate valuations based on the region due to fierce competition in the provision of housing. These fees, although a nuisance, are necessary in order to avoid costly repairs. 

Property Taxes

Property taxes in Northern Virginia depend on the county and city, but they are a tad high when compared to other states in the US. For example, the county tax rate can be much higher for Arlington County than that of the rate for nearby Fairfax County. This is a recurrent one that might inflate your homeownership costs by a considerable measure, so it’s important to incorporate these into your budget before you make offers. Consider also that taxes typically increase year-over-year.

Homeowners Association (HOA) Fees & Condo Association Fees

Periodic homeowner’s association fees are another expense that may pinch your pocket. Condo fees also drastically vary across Virginia, including up to Northern Virginia and some communities may have higher fees due to the provision of detailed services such as overseeing communities’ pools, fitness centers, social associations, and the like. Monthly dues are about $300 to more than $1,000.

These fees are used to maintain the common areas of the building and may also include extra fees for refuse disposal and snow removal services which are important especially in the area. If the property is not a condo but it has an HOA, the fees are generally lower since HOA’s do not cover exterior maintenance, but instead cover things like trash, water & sewer and offer some amenities like a playground or outdoor pool.

Utilities and Maintenance

Generally, costs of utilities in Northern Virginia are substantially above average, especially those of electricity and water. The cost of utilities for a normal household is between $120 and $400 per month based on the amount of usage and the quality of the systems within the home. Also, general maintenance, which is a one-time expense of 1 to 4 percent of the value of a home, is a major hidden cost.

This relates to all forms of work that may need to be done on properties including touch-up work as well as extensive remodeling and should be factored in a lengthy financial model. Your real estate agent may provide you with a list of general upkeep items that you should consider doing monthly and yearly to properly maintain the home.

Renovation and Upkeep Costs

If you are considering living in an older home or any home that is located in some historic areas such as Alexandria or the countryside area of Loudoun, you will find that the initial cost of renovation and even regular maintenance is fairly high. Some of the most typical tasks include upgrading heating systems, roof replacement, and enhancement of insulation – all of which are likely to significantly increase your initial costs.

For homes built before 1978, lead based paint removal or asbestos remediation may also become a concern. For older homes, consider if the electrical and plumbing has been replaced prior to purchasing. This can significantly reduce your upfront repair cost. 

Commuting and Transportation Expenses

Considering that Northern Virginia is located near Washington, D. C. and home to Tysons Corner, commuting expenses should be considered as well. Imagine costs like gasoline, toll fees, and/or transportation fares that accumulate, considering one has to commute daily to the city. Also, there are paid parking spaces in many regions, thus escalating daily costs even more often. And if you park at the metro, you will need to take into account the metro and parking fare, too. 

Insurance Premiums

Various factors affect the insurance cost of homes such as the closeness to  water sources, age, condition and the value of the home. Homeowners insurance is one of the most complex types of policies where the price might differ drastically which in general would be even higher in the particular area where certain risks are identified such as flood or hurricane. Always check to see if the home you are considering purchasing is in a flood zone before you move forward.

Conclusion

It is very easy to fall in love with Northern Virginia like many people do but one must consider the true price that comes along with purchasing a house within this region. Other costs that are not as obvious as the monthly mortgage payment include closing costs, resettlements costs, service fees, property taxes, homeowner association fees, and homeowners insurance that are closer to the real cost of owning a home.

The old saying, ‘knowledge is power’ could not be more true when it comes to seeking a place to live in this part of the world with the right preparation, these waters can be mastered to get the perfect home. If you are looking for more specifics on the cost of living in Northern Virginia, or how to purchase a home in Northern, Virginia, contact Nadia Khan, today.