Hidden Costs of Buying a Home in Puyallup

The price of the house is the number everyone watches. The numbers that cause stress are the ones nobody mentioned. Most of them are predictable if you know to ask.

I have organized this by when the cost shows up: before closing, at closing, in the first few months, and every year after. A few are specific to the Puyallup area, and I have flagged those.

The timeline at a glance

Before closing

Earnest money

When your offer is accepted, you deposit earnest money with the escrow company, often within a couple of business days. It is credited toward your purchase at closing, so it is not an extra cost. It is cash you need available early, and it can be at risk if you default after your contingencies expire.

Inspections

Budget for more than one.

• General home inspection. The foundation of your due diligence.
• Sewer scope. A camera run through the side sewer to the street. Strongly advised on older homes downtown and anywhere with mature trees. The line from the house to the main is the owner's responsibility.
• Septic inspection. If the home is on septic, a certified septic professional should inspect it, and the tank may need pumping to do so. This is a big one locally, because so many homes outside the city are on septic.
• Well testing. For homes on a private well, a flow test and water quality testing.
• Specialists. A roofer, structural engineer, or HVAC technician if the general inspection raises a concern.
• Pest inspection. Sometimes separate.

These are paid at the time of service and are not refunded if you walk away. They are also the best money you will spend. Finding a failing drainfield or a broken sewer line before closing can save you tens of thousands.

Appraisal

If you are financing, the lender orders an appraisal and you pay for it, usually up front.

If the appraisal comes in below your offer price, you may need to cover the gap in cash, renegotiate, or cancel, depending on your contract.

At closing

Buyer closing costs vary with the loan, the price, and the lender. A common planning range is a few percent of the purchase price, on top of the down payment. Your lender's Loan Estimate itemizes them, and the Closing Disclosure confirms them a few days before signing.

Loan costs

• Origination or underwriting fees
• Discount points, if you choose to buy down the rate
• Credit report, flood certification, and similar small fees
• Upfront mortgage insurance on FHA loans, or the funding fee on VA loans, both usually financed

Title and escrow

• Lender's title insurance. Required by the lender.
• Escrow fee. In Washington, commonly split between buyer and seller. On VA loans, the rules on what a buyer can pay differ.
• Recording fees.

The owner's title policy is customarily paid by the seller here.

Prepaids and escrow reserves

This is the part buyers most often overlook. It is not a fee. It is your own money set aside in advance.

• Homeowners insurance. The first year's premium is usually paid at or before closing.
• Prepaid interest. From the closing date to the end of that month.
• Property tax proration. You reimburse the seller for any taxes they have paid covering time after closing.
• Escrow account deposit. The lender collects several months of taxes and insurance to start the account.

Together these can add up to a meaningful sum, especially when closing falls just before a tax due date.

Other items

• Association transfer or setup fees, where there is an HOA
• Prorated association dues
• Your broker's compensation. Washington requires a written agreement with your broker that states how they are paid. Often the seller covers it. Sometimes the buyer pays some or all. Know your agreement before you write an offer.

What sellers pay

Not your cost, but useful to know for negotiating: the seller typically pays the state's real estate excise tax, the owner's title policy, their share of escrow, and brokerage fees. In some markets sellers will also credit part of your closing costs.

The first 90 days

Moving

Movers or a truck, packing supplies, storage if the dates do not line up, and travel if you are relocating. Long-distance moves cost far more than local ones. Get quotes early.

Utility setup

Deposits or connection fees for electricity, gas, water, garbage, and internet. Small individually. They add up in a week when everything else is due.

Things the house does not come with

• Refrigerator, washer, and dryer, unless the contract includes them
• Window coverings, especially in new construction
• A lawn mower and yard tools
• Garbage cans, if the hauler charges for them
• Locks rekeyed, which you should do on day one

Immediate repairs

Even with a good inspection, there is usually a short list: a leaking faucet, a tired water heater, gutters that need cleaning, a furnace that needs service. Keep a cushion for it.

Every year

Property tax

Billed by Pierce County, due April 30 and October 31. A planning figure of about 1% of assessed value is reasonable for this area. Voter-approved levies can raise it. Look up the actual bill before you buy. See my post on how much property taxes are in Puyallup.

One trap: if the seller has a senior or disability exemption, the tax shown on the record is lower than what you will pay.

Homeowners insurance, and what it leaves out

This one is specific to our area. A standard policy does not cover:

• Flood. Parts of the valley are in the Puyallup River floodplain. If the home is in a mapped high-risk zone and you have a federally backed loan, flood insurance is required. Outside those zones it is optional and available.
• Earthquake. The Puget Sound region is seismically active. Coverage is a separate policy or endorsement with a large deductible.
• Mudflow from a lahar. The valley floor is in a mapped lahar zone. Standard policies generally exclude earth movement and mudflow. Ask your agent what is available.
• Sewer backup. Usually an inexpensive add-on.

Get quotes for the coverage you want during your inspection period, not after closing. I go through this in my post on homeowners insurance in Puyallup.

Mortgage insurance

If you put less than 20% down on a conventional loan, you pay private mortgage insurance monthly until you reach enough equity. FHA loans carry their own.

Association dues

Common in subdivisions built since the late 1980s and in all condos. Monthly, quarterly, or annual. They rise over time, and special assessments can be added. Read the budget and reserve study. See my post on HOAs in Puyallup.

Utilities

Electricity, gas, water, sewer, stormwater, garbage, and internet. Ask the seller for twelve months of bills. Inside the city, the sewer bill is based on winter water use. In the county, a surface water fee appears on your tax statement. I cover all of it in my post on budgeting for utilities.

Septic

If the home is on septic:

• Inspections on the schedule the health department sets, by a certified professional
• Pumping every few years
• Repairs to pumps, alarms, and filters over time

There is no monthly sewer bill, so set money aside instead.

Maintenance in a wet climate

This is the cost newcomers from dry regions underestimate. A common rule of thumb is to budget around 1% of the home's value each year for upkeep, more for an older home.

What that covers here:

Skip these and small problems become expensive ones.

Eventually: the big replacements

Every component has a lifespan. Know where each one is when you buy.

Ask for the age of each during your inspection period. A home with a 22-year-old roof and an 18-year-old furnace is not priced the same as one where both were just replaced, or it should not be.

My posts on roof replacement, heat pumps, and water heaters give cost ranges.

Costs tied to location

A few more that depend on the address.

• Commuting. Fuel, tolls, parking, or a transit pass. A cheaper house farther out can cost more in total.
• A second car, if the location requires it.
• Private roads. Shared maintenance costs, sometimes with no formal agreement.
• Trees. Tall firs need occasional professional work, and removal is costly.
• Drainage fixes. French drains, regrading, or downspout extensions if the lot holds water.
• Fencing. Priced by the foot, and often missing in new construction.
• Air conditioning. Many older homes have none.

New construction extras

If you are buying new, add landscaping, fencing, window coverings, and appliances. Also check the property tax estimate. The county's record may reflect land only until the finished home is assessed, and the first full bill will be much higher. See my post on new construction in Puyallup.

The move itself

It is easy to budget for the house and forget the move.

• Movers or a truck, priced by distance and volume
• Packing materials
• Travel, lodging, and meals if you are coming from out of the area
• Overlap between your old housing and the new mortgage
• Storage, if closing and move-in do not line up
• Time off work

For a long-distance move, get written estimates from more than one carrier well ahead of your closing date.

A cash-to-close worksheet

Your lender fills in most of these on the Loan Estimate. Add the last four yourself.

How to keep the surprises small

1. Ask the lender for a Loan Estimate early and read every line.
2. Get insurance quotes during the inspection period, including flood and earthquake if relevant.
3. Order the right inspections for the property: sewer scope, septic, well.
4. Ask the seller for utility bills and the ages of major systems.
5. Read the association documents.
6. Look up the actual property tax.
7. Keep reserves after closing. Several months of expenses is a sound target.

A house you can comfortably carry is better than one that leaves nothing in the bank.

Frequently asked questions

How much are closing costs for a buyer in Puyallup?

They vary by loan and price. A common planning range is a few percent of the purchase price, in addition to the down payment. Your lender's Loan Estimate gives the itemized figure.

What inspections should I get when buying a home in Puyallup?

A general home inspection, plus a sewer scope on older homes, a septic inspection if the home is not on sewer, and well testing if it has a private well. Add specialists if the inspector recommends them.

Does homeowners insurance cover floods or lahars in Puyallup?

No. Standard policies exclude flood and generally exclude earthquake, earth movement, and mudflow. Those require separate coverage.

How much should I budget for home maintenance each year?

About 1% of the home's value per year is a common rule of thumb, and more for older homes. The wet climate makes gutters, roofs, and drainage regular expenses.

What costs do buyers forget at closing?

Prepaid homeowners insurance, prepaid interest, property tax prorations, and the initial deposit into the escrow account are the items buyers most often overlook.

Related reading

• How Much Income Does a Family Need to Live in Puyallup?
• How Much Are Property Taxes in Puyallup?
• How Much to Budget for Utilities in Puyallup
• HOAs in Puyallup: How Common They Are and What They Cost

Equal Housing Opportunity. Austin Robertson, License # 21036843, Austin Robertson and Allena Robertson Real Estate Brokers, regulated by the Washington State Department of Licensing (DOL). This article is general information only. It is not legal, tax, insurance, lending, or construction advice, and it is not an appraisal of any property. Robertson & Co. supports fair housing and does not describe or recommend neighborhoods based on who lives there. Costs, rates, and rules change. Confirm the details with the sources linked above before you act.