I live in a small — not tiny — house, so maybe this doesn’t apply to me, but let’s look at it anyway:
It occurred to me the other day that it doesn’t take any more money to live in a big house than it does to rent a small apartment, providing that the house is paid for. Take someone who has lived in the same house for 30 years and diligently paid their mortgage every month, or someone who inherited a house, or won the lottery and bought it outright. Doesn’t matter how they got it, once the mortgage is paid off, the expenses don’t go away, but they are considerably reduced. Going by my own experience, annual property taxes on a house are going to about 1% of the market value. Utilities and insurance are about the same. A mortgage or rent for a house or apartment is about 1% of the market value per month.
I’m about halfway through that thirty-year note. Property taxes vary considerably in this state, but I usually end up paying about 1.2 percent of market value each year. Insurance, however, is a monstrous expense here: we are, after all, smack dab in the middle of Tornado Alley, and my annual premium ends up at about 3 percent of market value, a figure entirely too close to $3,000. Utilities will fluctuate with the season, but on average, about 2 percent of market value each year goes to paying for water/sewer/refuse, electric, and gas. (Last two electric bills were just over $170 each. Then again, those bills were for July and August, when it’s either hot or stupidly hot, the time of year when we spit at those Northeastern jerks who think they’re too good for air conditioning.)