What Does It Cost to Own a House Per Year?
Last reviewed 2026-09-25
The mortgage is only part of the bill. The non-mortgage costs of owning a home total roughly 3–6% of the home's value every year — maintenance, property taxes, insurance, utilities, and HOA dues combined. That's the headline composite our sell vs stay analysis uses, and each component below carries its own band. Where a figure is an industry convention rather than a published statistic, we say so.
The holding-cost components
| Component | Typical annual share | Detail |
|---|---|---|
| Maintenance* | 1–2% of value per year | The 1% rule for newer homes; older or deferred-maintenance homes run up to 4%. This is an industry convention, not a published statistic — flagged as a convention consistent with GR default tables. |
| Property taxes | 0.5–2.5%+ of value | The state spread is wide; high-tax states exceed 2.5%. Defaults derive from Tax Foundation/Lincoln Institute state effective tax rates. |
| Homeowners insurance | 0.4–1.0% of value | Roughly 0.3–1.5% when flood and wind riders are included — the spread widens with catastrophe exposure. |
| Utilities | $3,000–$5,400 per year | Fixed-dollar component; varies with home size, climate, and energy prices. |
| HOA dues | $0–$3,600 per year | Only when applicable; condo and planned-community dues vary widely. |
*Industry convention, not a published statistic. The 3–6% total is itself a composite of conventions and state spreads — a budgeting band, not a single-source statistic.
Why the total matters more than the mortgage
On a $400,000 home, 3–6% is $12,000–$24,000 per year of costs that continue whether or not the mortgage is paid off. Two groups get surprised by this: first-time buyers who budget only for PITI, and owners deciding whether to sell or keep holding — the holding cost is the price of waiting, and it compounds alongside the tax and rate lock-in effects that guide covers.
Renting vs owning
If you're weighing a purchase, put the holding costs on the same footing as rent: the rent vs buy calculator compares the full annual costs of each, and how much house you can afford explains why lenders' affordability math understates these components.
FAQ
What does it cost to own a house per year, beyond the mortgage?
The non-mortgage holding costs total roughly 3–6% of the home's value per year: maintenance (1–2% for newer homes, up to 4% with deferred maintenance), property taxes (0.5–2.5%+ depending on state), homeowners insurance (0.4–1%), utilities ($3,000–$5,400/yr), and HOA dues ($0–$3,600/yr) if applicable.
On a $400,000 house, what is that per year?
At the 3–6% composite, roughly $12,000–$24,000 per year in non-mortgage costs. Property taxes alone could run $2,000–$10,000+ depending on your state, and utilities add $3,000–$5,400 regardless of the home's value.
Is the 1% maintenance rule real?
It's an industry convention, not a published statistic — set aside about 1–2% of home value per year for a newer home and up to 4% for older homes or homes with deferred maintenance. We flag it as a convention on purpose: treat it as a budgeting heuristic, not data.
Sources
- GR sell-vs-stay facts layer §4 — holding-cost components (retrieved 2026-09-25)
- Lincoln Institute — Significant Features of the Property Tax (state ETRs umbrella source)
Component bands cited from the GR facts layer (retrieved 2026-09-25), which derives property-tax and insurance shares from Tax Foundation/Lincoln Institute state ETRs and merged GR defaults tables. Convention-flagged figures are labeled as such above.