Ownership Costs

Cost of Ownership

Costs of Ownership

This should be one of your top priorities when buying real estate. However, it is important that you understand the real costs and not the cost that some people spout out. The following are a few questions that I hear over and over again. Some are fine to ask, but there are a few that you really need to rephrase or you will get the wrong answer. Let's start with the most frequently asked questions which need to be understood and rephrased or you will be mislead.

Property Tax

Wrong Question: What are Your Property Taxes?

This is the biggest mistake you can make in asking. As a matter of fact, I would say you waste your time asking because you can get mislead by a shrewd seller. Here is an example:

  • Assumptions Current Property Mill Tax Rate is 20: Assessed Value = Market Value, both Houses Listing for $1,000,000:
    • House 1: Bought 20 years ago for $100,000 and homesteaded will be taxed $7,200 (because the assessed value is only $180,620)
    • House 2: Bought 5 years ago for $750,000 and homesteaded will be taxed 17,400 (because the assessed value is $870,000)
    • Which house seems like a better deal? If you based it on what the owner paid, you would be miss lead. The answer is they are the same.
  • If you paid the $1,000,000 then the NEW Appraised value will be close to $1,000,000 so your Property Tax would be $20,000 annually.
    • Imagine your surprise if you bought House 1. The problem is that your mind will rule out House 2, because of the high tax and chances are that you will never go back to revisit that home. Yet, they both will have the same tax base when you buy them.
    • So, what is the right question to ask?

Correct Question: What is your MILLAGE RATE?

It is funny, but no one seems to ask that question. What is also funny, that it is easy to find out and for a general area the rate is the same. As an example: the millage rate for all of Clearwater Beach is currently about 20.1  That means you pay $20.1 per $1,000 assessed value.

But for those that want to know what our real estate property tax for 2017 was $9,509.70

For More information about Millage Rates check out Millage Rate on Investopedia

Operational Costs

Compare to Condo


The monthly costs of this house is less than most condos on the beach. The costs listed above includes all of the typical items included in the Condo Fee:
  • Hurricane Insurance (wind and Flood)
  • Trash
  • Sewer and Water
  • Landscaping
  • Outside Painting and Maintenance
  • Association Fees

Detail Costs



This house is well insulated and has several energy saving features:
  • CFL and LED lighting
  • Smart Home System
  • High Efficiency AC Units
  • R-32 to R42 Blown-in insulation
  • Wifi Thermostats
  • Energy saving roofing


Did We Forget Something?

We tried to think of everything that you would want to know, but if we forgot something. Let us know. Odds are if you are looking for it, it would help others too.