Nearly half of all homeowners report post-purchase regret, and the most commonly cited reason is that costs were higher than expected. This is not a failure of planning so much as a gap in what most home buying resources make visible. The mortgage payment, the down payment, and the purchase price receive most of the attention. The full cost picture is considerably more complex.

Understanding what to plan for — both at closing and in the months and years that follow — is one of the more useful things a buyer can do before making an offer.

Closing costs — more than most buyers expect

Closing costs are the fees associated with completing a real estate transaction and obtaining a mortgage. They include lender origination fees, title insurance, attorney fees where required, recording fees, transfer taxes, prepaid interest, and the initial escrow deposit for taxes and insurance. These costs are separate from the down payment.

The national average for closing costs is approximately 2% to 5% of the purchase price. On a $350,000 home, that range translates to $7,000 to $17,500 in closing costs — a wide range that reflects significant variation by state. New York, Delaware, and Maryland have some of the highest closing costs in the country due to state transfer taxes and other fees. States like Missouri, Indiana, and Iowa tend toward the lower end.

One component of closing costs that surprises many buyers is the initial escrow deposit. Lenders typically require two to three months of property taxes and homeowners insurance to be deposited into escrow at closing — separate from the first month's payment. On a home with $6,000 in annual property taxes and $1,500 in annual insurance, that initial deposit alone could be $1,875.

Inspection and due diligence costs

A general home inspection typically runs $300 to $600 depending on the size and type of the property. Condos tend toward the lower end; large single-family homes toward the higher. Additional specialized inspections — for radon, pests, sewer lines, oil tanks, mold, or specific structural concerns — can add several hundred dollars each if the property or location warrants them.

These costs are paid out of pocket regardless of whether the purchase ultimately closes. In competitive markets where buyers sometimes waive inspection contingencies, the cost of a pre-offer inspection — done before making an offer rather than after — has become more common, doubling the inspection expense if the home is not purchased.

Inspection costs are small relative to the overall transaction but are typically non-refundable. Budgeting for them separately from closing costs avoids the surprise of additional cash outflows before closing day.

Immediate repair and maintenance reserves

Homes rarely transfer in perfect condition. Even after a satisfactory inspection, most buyers discover items that need attention in the first year of ownership — items that were disclosed, items that were missed, and items that simply come up with normal use and the passage of time.

A widely cited guideline is to set aside 1% to 2% of the home's purchase price annually for maintenance and repairs. For a new home, 0.5% is often sufficient in the early years. For a home over 20 years old, 2% or more is a reasonable reserve given the higher likelihood of major system failures.

For older homes specifically, buyers sometimes set aside an additional immediate repair fund at the time of purchase — separate from the ongoing maintenance reserve — to address known or likely issues in the first 12 to 24 months. The appropriate amount depends heavily on what the inspection revealed and the age and condition of major systems.

Moving costs — often forgotten until the last minute

Moving costs vary widely based on distance, volume, and whether professional movers or a DIY approach is used. A local move using a professional moving company typically runs $1,500 to $4,000. A long-distance move can run $5,000 to $15,000 or more depending on distance and weight.

These costs arrive at the same time as closing costs, down payment, and initial maintenance items — creating a cash concentration that buyers who planned only for the down payment are sometimes not fully prepared for.

The Hidden Costs Shock Preventer tool on this site calculates the full upfront cash picture — down payment, closing costs by state, inspection, escrow deposit, immediate repair reserve, and moving costs — alongside the complete ongoing monthly cost including maintenance, taxes, insurance, and utilities.