Enter the monthly mortgage payment, total number of monthly payments, total maintenance costs, insurance costs, property tax, and renovation or improvement costs into the calculator to determine the total cost of homeownership.
- House Price Change Calculator
- Renovation Costs Per Square Foot Calculator
- House Flip Profit Calculator
Cost Of Homeownership Formula
The following formula is used to calculate the cost of homeownership.
COH = MP * n + M + I + T + R
Variables:
- COH is the total cost of homeownership ($)
- MP is the monthly mortgage payment ($)
- n is the total number of monthly payments
- M is the total maintenance costs over the loan term ($)
- I is the total insurance costs over the loan term ($)
- T is the total property tax over the loan term ($)
- R is the total cost of renovations or improvements over the loan term ($)
To calculate the total cost of homeownership, multiply the monthly mortgage payment by the total number of monthly payments. Add the total maintenance costs, insurance costs, property tax, and renovation or improvement costs to this result. This will give you the total cost of homeownership.
What is the Cost Of Homeownership?
The cost of homeownership refers to the various expenses associated with owning a home beyond the initial purchase price. These costs include mortgage payments, property taxes, home insurance, maintenance and repair costs, and potentially homeowners association fees. These costs can vary greatly depending on the location, size, and condition of the home. The cost of homeownership also includes the opportunity cost of the money invested in the home, which could have been invested elsewhere for potentially higher returns.
How to Calculate Cost Of Homeownership?
The following steps outline how to calculate the Cost of Homeownership.
- First, determine the monthly mortgage payment (MP) ($).
- Next, determine the total number of monthly payments (n).
- Next, determine the total maintenance costs over the loan term (M) ($).
- Next, determine the total insurance costs over the loan term (I) ($).
- Next, determine the total property tax over the loan term (T) ($).
- Finally, determine the total cost of renovations or improvements over the loan term (R) ($).
- After gathering all the variables, use the formula COH = MP * n + M + I + T + R to calculate the Cost of Homeownership.
Example Problem:
Use the following variables as an example problem to test your knowledge.
monthly mortgage payment (MP) ($) = 1500
total number of monthly payments (n) = 360
total maintenance costs over the loan term (M) ($) = 5000
total insurance costs over the loan term (I) ($) = 2000
total property tax over the loan term (T) ($) = 3000
total cost of renovations or improvements over the loan term (R) ($) = 10000
