Property taxes and insurance are making fixed mortgages less predictable
Surveys and real estate agents point to rising ownership costs that can change after closing, even when a borrower’s mortgage rate is fixed.
By Hana Yoshida · Markets Reporter
3 min read
Rising property taxes and insurance premiums are making homeownership costs harder to predict for buyers who expected a fixed-rate mortgage to stabilize their budget. Data from Ownwell, Bankrate, Insurify and the Federal Reserve show that costs outside principal and interest are taking a larger share of the monthly burden.
A survey of 2,500 U.S. homeowners by Ownwell, a property tax appeal service, found that 76% said their property taxes had recently exceeded what they planned for. That was up 10 percentage points from the prior year, according to Ownwell.
Ownwell also found that nearly two-thirds of respondents said their latest property tax bill surprised them or was worse than expected. Nine in 10 said rising property taxes posed a long-term financial concern, and 40% said they had thought about moving because of them.
Escrow can change even when the loan does not
Colton Pace, Ownwell’s chief executive, told Fortune that taxes and insurance have become major affordability shocks after buyers close on homes, particularly in high-tax states such as New York, Massachusetts and Texas. He said rising taxes and insurance have undercut the predictability many borrowers associate with a fixed-rate loan.
A 30-year fixed mortgage keeps the loan’s principal-and-interest payment steady, but many homeowners pay taxes and insurance through escrow. Those pieces can move when local tax bills reset or when insurance policies renew.
Federal Reserve data cited by Fortune show the average sales price of new homes rose about 23% over five years. Ownwell’s Pace said tax assessments have followed home values upward, while local budgets, tax rates and housing-market changes make future bills difficult to forecast.
Agents say buyers often miss the full monthly cost
Kori Sassower, principal agent of The Kori Sassower Team at Compass and licensed in New York and Connecticut, told Fortune that buyers often focus on mortgage rates and purchase prices while giving less attention to recurring costs that can rival or exceed the mortgage payment. She said property taxes vary widely by municipality and are the biggest variable she sees.
Sassower said maintenance also catches buyers off guard. She cited costs such as HVAC service, pest control, tree work, power washing, gutter cleaning and stone repointing as examples of routine ownership expenses.
For condo buyers, association fees can add another changing cost. Miltiadis Kastanis, a Miami-based Compass agent, told Fortune that good advisers raise these costs before closing, but buyers still face a learning curve once they own the property.
Michelle Griffith, a New York City-based agent with Douglas Elliman, told Fortune that New York buyers are often more familiar with property taxes and monthly charges. She said assessments, maintenance fees, furnishing costs and expenses tied to larger homes can still surprise buyers, especially those coming from rentals.
National ownership costs top $21,000 a year
Bankrate’s 2025 study found that the costs of owning a single-family home beyond the mortgage — including property taxes, insurance, utilities, internet and maintenance — topped $21,000 a year nationwide. Bankrate said maintenance was the largest category, at $8,808.
Bankrate also found that among homeowners with regrets, the most common one was that maintenance and other ownership costs were higher than expected.
Insurance is adding more pressure. Insurify said the average annual home insurance premium rose 12% in 2025 and is projected to rise another 4% by the end of 2026, to about $3,057. The company said premiums have climbed 46% since 2021, with the sharpest strain in states exposed to natural disasters, including Florida and California.
This story draws on original reporting from Fortune.