Compare First-Year Cash Costs for Two Homes
Compare two homes using upfront cash, monthly payments, taxes, insurance, HOA dues and maintenance. See when the lower price costs more in year one.
In this guide
A lower-priced home can require more cash in the first year if its ongoing costs are higher. Add total upfront cash to the first year’s housing budget, then remove any expenses already counted in the upfront amount.
Compare two estimates on the same basis
| Input | Home A | Home B |
|---|---|---|
| Purchase price | $350,000 | $365,000 |
| Upfront cash after credits, including deposits | $42,000 | $43,500 |
| Monthly housing budget including maintenance | $2,850 | $2,700 |
| Prepaid expense already in annual budget | $1,200 | $1,200 |
| Estimated first-year cash budget | $75,000 | $74,700 |
Home A costs $1,500 less upfront but $150 more each month. That $1,800 annual difference makes Home A $300 more expensive under the stated assumptions.
Check what each monthly figure includes
Build the monthly estimate from the quoted principal and interest, the tax and insurance budget, mortgage insurance, HOA dues and a maintenance allowance. Review the association documents for charges billed separately. Verify prepaids on the disclosure and subtract only amounts that appear in both your upfront and ongoing estimates.
Which home leaves more cash right after closing?
Compare the upfront amounts first. Home A uses $1,500 less before or at closing in this example. Use the annual comparison to see how quickly that difference changes. Review the CFPB Loan Estimate guide for help reading the quoted figures.
Compare closing-day cash and first-year costs with your own figures.
Explore this topic further
Check your assumptions with these tools and related guides.
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This guide is general education, not personalized financial advice. Rates, limits and rules change; confirm current figures with the lender, issuer or agency before you act. See our financial disclaimer and affiliate disclosure.
