As a homeowner, there are a lot of costs and maintenance requirements that you need to be aware of. It can be overwhelming to try and understand everything that goes into owning a home, but with a little bit of knowledge and preparation, you can navigate the world of home ownership with ease. In this video, we will be discussing the different costs involved in owning a home, as well as the maintenance requirements that come with it.
Hopefully, by the end of this, you can be well on your way to learning how to treat property like a business.
Introduction to Home Ownership and Understanding the Different Costs Involved
Owning a home is a big responsibility, and it’s important to understand the different costs involved. These costs can include things like:
- Council rates and how they vary across different LGAs plus different
- Water rates and usage
- Electricity rates and usage
- Gas rates and gas usage
- Maintenance costs and upkeep of the property
- Phone communication and Internet services
- Pest control and how to prevent infestations
- Home and contents and theft insurance
- Land tax and when it applies
- Mortgage payments
As a homeowner, there are many costs that need to be taken into consideration and all these expenses do add up quickly. One of the most common and unavoidable costs is council rates.
Understanding Council Rates and How They Are Calculated
Council rates are fees that are charged by local councils to help fund local services and facilities. These rates are calculated based on the land value of your property and can vary depending on which local government area (LGA) your property is located in.
So a 600sqm block as opposed to a 1000sqm block would have different rates and you would expect that the larger block size land would result in higher council rates to be paid. The land value of your property can generally be found on your council rates bill.
Different Council Rates and How They Vary Across Different LGAs
As previously mentioned, council rates can vary depending on which LGA your property is located in. Some LGAs may have higher rates than others, so it’s important to research the rates in your area.
For example, some LGAs may have more parks and recreational facilities than others, which can result in higher rates. There are even different bin sizes and types of bins that each LGA has. So some have green waste, red waste and recycling. Some just have red waste and recycling.
Understanding Bin Days and Bin Types in Different Areas
Bin days and bin types can vary depending on which area you live in and because some areas have different-sized bins or different collection schedules, it’s important to be aware of these differences. All of these factors result in the amount that you pay for council rates.
Council Collections and Pick Ups
In addition to bin collections, your local council may also offer other collection and pick-up services like collecting different types of bulky items like furniture and older appliances that you longer have use of. Be sure to check your council guidelines as there will be items that they will not take.
Understanding the rules and regulations set out by your local council is essential in making sure that you are following the proper guidelines. You would also want to consider saving money where you can.
For example, some councils charge for bin replacements and some don’t and therefore you would want to look after your bins as best as possible and saving money where you can is an important consideration as the last thing you want to do is notice your costs all adding up and increasing for reasons that aren’t necessary.
It’s the same thing for water rates and usage. These are also unavoidable however are something that you can control and put certain measures in place to reduce the amount that you are using.
Water Rates and Usage
Water rates are charged by your local water authority and are based on the amount of water that you use. It’s important to be mindful of your water usage to avoid high water bills.
There are a number of things that you can do to reduce your water usage and lower your bills.
For example, you can install water-efficient appliances and fixtures, like water-saver shower heads, fix any leaks, and reduce your overall water usage by taking shorter showers and using a water-efficient washing machine. Additionally, you can research what water-saving programs your local council may offer.
Water rates and usage are generally charged quarterly however it’s up to the water company to decide how and when they bill you. There are some companies out there that will read the water meter monthly or in some cases only twice a year being biannual. So make sure you read the terms and conditions of your water bill to understand how often you will be billed for your usage. Having said this, different companies charging different rates at different times isn’t just for water and in fact, the same thing can be said about electricity rates and usage.
Electricity Connection Rates and Usage
The billing cycle for electricity and usage is anywhere between 1 to 3 months. The date that your bill is generated and sent to you is the bill cycle date. So, your rates notice for example may be generated on the 15th of every month, this means that your billing cycle is the 15th of every month. Otherwise, quarterly or bi-monthly bills come every 2-3 months.
Just like water, electricity rates and usage, Electricity rates may vary depending on your energy provider.
Your energy provider charges electricity connection rates and are a one-time fee for connecting your property to the electricity grid. These fees can vary depending on your provider, so it’s essential to shop around and compare your options.
In addition to connection rates, you will also be charged for your electricity usage. It’s important to be mindful of your electricity usage to avoid high bills. You can reduce your electricity usage by using energy-efficient appliances and turning off lights and electronics when not in use.
As you can see there are ways to reduce your usage across different rates, fees and charges when it comes to the costs of running a home. I’m sure you can imagine what may happen if you accidentally left something on for a long period of time that you were unaware of.
It’s important to remember that not all properties have the same type of rates charged to their property. For example, all properties would be charged electricity, water and council rates which are unavoidable however a property may not have gas attached to it and might be run by only electricity. This means that property without gas wouldn’t be charged in this instance because the property is predominantly run by electricity.
Gas Rates and Gas Usage
If you do have gas, these are rates charged by your gas provider and are based on the amount of gas that you use. Some ways that gas is used are for heating, hot water, and cooking appliances such as stoves and ovens.
You can reduce your gas usage by using the most efficient appliances you can find (such as condensing boilers) and switching off any devices when not in use.
There are a number of things that you can do to reduce your gas usage and lower your bills. For example, you can install gas-efficient appliances and fixtures, reduce your overall gas usage by using a clothesline instead of a dryer, and turn off your gas heating when not in use. The same thing can be said about other services that are connected to your home. Phone Communication and Internet Services.
Thankfully we live in a day and age where some things are just not needed as they are not as commonly used as they use to be which means that there are ways to completely avoid unnecessary bills. How many people have landlines nowadays? Yes, you might have people who still have landlines but what if you don’t need it simply because no one calls you anymore on the landline?
We also live in a world today where we use internet services and have things connected like NBN, ADSL, Cable and Fibre, these kinds of services come with all sorts of fees and charges. So you would want to shop around and compare your options to ensure that you are getting the best deal both on quality as well as price as this is another expense that you would need to factor in. You’ve also got things
Maintenance Costs Like Gardens and Lawns
Maintaining your gardens and lawns can be a significant expense for homeowners. It’s important to budget for these expenses and to be aware of the maintenance requirements for your property.
There are a number of things that you can do to reduce your gardening and lawn maintenance costs. For example, you can install low-maintenance plants and turf, use mulch to reduce water usage and compost your food scraps to reduce waste.
Pest Control and How to Prevent Infestations
Pest control is an important aspect of home maintenance. It’s important to be proactive in preventing infestations and to take action quickly if you notice any signs of pests.
There are a number of things that you can do to prevent pests from entering your property. These include sealing up any cracks or gaps in your walls and floors, keeping your property clean and tidy, and using natural pest control methods.
Home and Contents Insurance and Theft Insurance
Home and contents insurance and theft insurance are essential for protecting your property and belongings. It’s important to shop around and compare your options to ensure that you are getting the best coverage for your needs.
There are a number of factors to consider when choosing home and contents insurance and theft insurance. These include the cost, the level of coverage, and any additional benefits or features.
Land Tax and When it Applies
Land tax is a tax that is charged on the value of your property. It’s important to be aware of when land tax applies and to budget for this expense.
Land tax can vary depending on which state or territory you live in. Additionally, there are exemptions and concessions available for some property owners, so it’s important to research your options.
One of the biggest expenses that come with owning a home is mortgage repayments. When you take out a mortgage, you will be required to make regular repayments to your lender. These repayments will include the principal amount borrowed as well as the interest charged by the lender unless you take out an interest-only loan and this really depends on your circumstances as well as the goals that you are trying to achieve.
Mortgage Repayments and Interest Rates
When it comes to mortgage repayments, it’s important to understand how they work. The interest rate that you are charged will depend on a number of factors, including the size of your deposit so where your loan-to-value ratio sits, the length of your loan term, and whether you take out an interest-only loan or principal and interest loan. Interest rates.
It’s important to shop around when it comes to getting a mortgage. Different lenders will offer different interest rates, so it’s important to compare your options carefully. And although you can go straight to the bank you’re best off going to a Mortgage Broker as they are there to help you get the best deal possible and don’t just look at one lender but rather multiple lenders.
They are there to do the work on your behalf so that you don’t need to try and navigate the banks yourself. Additionally, your mortgage broker can even negotiate interest rates for you. Every 2 years you should be getting a review on your mortgage so that you can get better rates.
Navigate the World of Home Ownership with Ease
Owning a home comes with a lot of costs and maintenance requirements. It’s important to be aware of these expenses and to budget accordingly. By understanding the different costs involved in owning a home, you can make informed decisions and navigate the world of home ownership with ease.
Remember to shop around and compare your options when it comes to things like mortgage repayments, council rates, and insurance. Additionally, be proactive in maintaining your property and preventing pests from entering your home.
With a little bit of knowledge and preparation, you can enjoy the many benefits of home ownership without breaking the bank.
