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6 Expenses That Come with Owning a House vs. Renting an Apartment

Posted by South Dakota Housing Authority on Jan 28, 2016 10:50:29 AM


It's important to not start the homebuying process without first establishing the limitations of your monthly budget. When you rent an apartment, there are certain monthly bills for which you're responsible (i.e., rent, renter's insurance, select utilities, etc.). When it comes to homeownership, however, there will likely be several additional financial responsibilities you'll want to account for in your projected budget.

Here are a few of those key expenses to keep in mind.


While your rental agreement might include utility responsibilities such as electricity or internet access, owning property entails another list of potential utility payments. For example, you'll need to account for perhaps larger electricity and gas bill payments due to a more-than-likely larger square footage. You'll also need to pay a water bill to get access to the city's water supply and for sewage disposal. And while your apartment complex might have a communal dumpster, you'll need to set up garbage pickup service with a local provider when you own a house.

Lawn Care

The days of your property starting at your front door will be long gone once you transition from a rental apartment to your first house. If your property has a lawn, you'll be responsible for caring for it. Depending on your city, there will be municipal laws that dictate how long your lawn is allowed to be before fines are assessed against your property. So during warm seasons, make sure your budget is prepared for the ongoing expenses of gas for your mower and water or seed for your lawn, as well as the one-time expense of purchasing a mower.

On the plus side, unlike in an apartment, you'll now have a yard where you can host parties, set up a deck or patio and landscape to your liking.

And even though it's not exactly your "lawn," remember that you'll be responsible for shoveling your sidewalks of snow during the winter-time. Cities have requirements around how quickly you need to accomplish this after a snowfall is complete. Prepare your budget for the one-time expenses of purchasing shovels or a snowblower or the ongoing expenses of hiring a snow removal service.

Home Maintenance

When it comes to house upkeep, there won't be a super around to fix things for you. Plan ahead that unforessen expenses, such as plumbing, power supply, faulty appliances or even burnt-out light bulbs, will be your responsibility once you own a house. It's difficult to know when you might need to rely on these funds, but it's a good idea to have some incidental wiggle room in your budget for these expenses.

And don't forget the fun stuff - now that you'll be a homeowner, you'll have free rein to choose your wall paint colors, decorations and indoor enhancements. Make sure to set aside some funds for these too!


Depending on your rental agreement, you more than likely aren't paying taxes on your apartment or rental property. But once you own a house, you'll be responsible for paying property taxes to the city. These taxes are typically assessed on an annual or semi-annual basis and can fluctuate depending on your property value and other factors. You should get a basic estimate of this cost during the mortgage application process. This expense can be paid in full annually or split up across monthly payments through an escrow account.


When you're in the process of purchasing a house, you'll need to secure homeowner's insurance. You can typically receive quotes or estimates online based on the nature of your property, or an insurance agent or broker can help you secure the ideal policy for your situation. Plan on factoring the cost of the premium into your monthly budget. (NOTE: It can sometimes help to bundle your home insurance with your auto or other types of insurance - it's a money-saving tool that could ease strain on your budget.)


This probably goes without saying, but you'll have to pay your monthly mortgage expense. It's something that you should be used to from renting a property - after all, you've already been paying monthly rent. Your mortgage payment can also be paid through an escrow account to bundle your taxes and house payment into one monthly payment, one day a month, versus separate payments and due dates.

Keep in Mind

Whatever your situation, your expenses will vary. But when it comes to transitioning from renting to owning, it's a good idea to prepare yourself for costs you've never before experienced. Owning a house is a new and rewarding experience - with a few minor adjustments to your monthly schedule, you can invest in a bright future.


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Topics: Homeownership

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E-Book Download A South Dakotan's Guide to Buying Your First Home Vol. 1