6 Hidden Costs of Buying a Home in DC That Realtors Wish You Knew
Buying a Home in DC? Watch Out for These Unexpected Costs
You’ve found the perfect home in Washington, DC, and you’re ready to make an offer. You’ve budgeted for your down payment and closing costs, but are you really prepared for the hidden expenses that come with buying a home?
Many first-time (and even experienced) buyers overlook key costs that can add thousands of dollars to their total costs. To help you avoid surprises, here are six hidden costs that Washington DC realtors say every buyer should know about.
1. Higher-Than-Expected Closing Costs
Most buyers expect to pay closing costs, but they often underestimate how much. In DC, these fees typically range from 3% to 6% of the home’s purchase price—which can add up fast.
What’s Included in Closing Costs?
✅ Lender fees (loan origination, underwriting)
✅ Title insurance
✅ Appraisal and home inspection fees
✅ Taxes and government recording fees
💡 Pro Tip: Always ask your lender for a Loan Estimate early in the process to see a breakdown of expected closing costs.
2. Transfer and Recordation Taxes
Washington, DC has some of the highest real estate taxes in the country. The DC transfer tax and recordation tax can range from 1.1% to 1.45% of the home’s price—meaning you could pay $8,700 or more on a $600,000 home just in taxes.
Who Pays What?
Buyers typically pay recordation tax
Sellers cover transfer tax (unless negotiated otherwise)
💡 Pro Tip: First-time homebuyers in DC may qualify for the Reduced Recordation Tax Rate, lowering the rate to 0.725% instead of 1.1%.
3. Home Inspections & Additional Testing
Most buyers know they’ll need a home inspection, but they don’t always budget for extra tests that could reveal costly issues.
Common Additional Inspections:
🔹 Radon Testing ($150–$300) – DC homes can have elevated radon levels.
🔹 Sewer Scope Inspection ($300–$500) – Especially important for older DC rowhouses.
🔹 Lead Paint Inspection ($300–$600) – Sometimes recommended for homes built before 1978.
💡 Pro Tip: While these tests add upfront costs, they can save you thousands in unexpected repairs later.
👉 Want expert guidance on navigating hidden costs? Our team at City Chic Real Estate knows the DC market inside and out. Schedule a free consultation today!
4. Homeowners Insurance & Flood Insurance
Standard homeowners insurance costs about $1,000–$2,000 per year in DC, but some homes may require additional coverage:
🌊 Flood Insurance – If your home is in a FEMA flood zone, this is required and can cost $700–$2,000 per year.
🏚 Older Home Premiums – DC’s historic rowhouses often have higher insurance rates due to their age.
💡 Pro Tip: Get insurance quotes before making an offer to avoid unexpected costs after closing.
5. Condo & HOA Fees
If you're buying a condo or a home in a managed community, monthly fees can add up fast. Some DC condos charge over $800 per month in HOA dues, covering:
🏠 Building maintenance
🔧 Utilities (sometimes)
🛠 Reserve fund contributions for future repairs
💡 Pro Tip: Review meeting minutes before buying to check for planned fee increases or upcoming assessments.
6. Post-Move-In Repairs & Upgrades
Even if your home passes inspection, you’ll likely need to budget for repairs and upgrades after moving in.
🔹 New Locks & Security Systems – $150–$500
🔹 Painting & Minor Fixes – $1,000+
🔹 HVAC Servicing – $300-600
🔹 Landscaping & Exterior Maintenance – $500+
💡 Pro Tip: Set aside 1–3% of the home’s price annually for maintenance and unexpected repairs.
Additional Tips to Budget for Hidden Costs
✔️ Ask for Seller Concessions – In some cases, sellers may agree to cover closing costs.
✔️ Shop Around for Lenders – Some lenders offer discounted fees or credits to reduce closing costs.
✔️ Negotiate Inspections & Repairs – If an inspection reveals issues, you may be able to negotiate repair credits from the seller.
Final Thoughts: Be Prepared for the True Cost of Homeownership
Buying a home in Washington, DC is a big investment, and unexpected costs can add up quickly. By planning ahead for these six hidden expenses, you’ll be better prepared to make a smart, financially sound decision.
👉 Thinking about buying a home in DC? Let City Chic Real Estate help you navigate the process with confidence. Contact us today to get started!
