Buying a home is a significant achievement that can be financially rewarding. You may have an understanding of what a down payment and closing costs are, but there are additional costs that you need to consider.

If you are thinking of buying a home in Arizona, you need to know the all of the costs associated with buying and owning. This includes the costs that you will be subject to:

  1. Before you buy your home (while it is under contract),
  2. When you buy your house (at the closing appointment),
  3. And after you buy your house.

If you do not take into account the true costs of home-ownership, you can find yourself making mistakes that will impact your wallet and peace of mind.

Some are technically not costs (or expenses) such as your down payment, deposits and reserves. Notwithstanding, they do cause money to leave your bank account and are required to buy the home. As such, they are mentioned here in the discussion of cost of buying a home. This is also to acknowledge the fact that the largest barrier to buying the home is the total cash to you have to come up with to close on your home.

Costs Incurred Before You Buy the Home

Once you have an accepted purchase contract, there are various services that you may have to pay. These include the following:

Earnest Money Deposit

When your purchase offer is initially accepted by the seller, you will typically make an earnest money deposit to show your good faith intent to purchase the home. In Arizona, the earnest money deposit is typically held by an agreed upon escrow company. This money is held during the contract period and is applied towards (not in addition to) the total required cash to close when the purchase is completed. Be advised that if the home doesn’t close and the contract is cancelled, you could possibly lose your earnest money deposit. The amount of the earnest money deposit is dependent upon different factors involved in the home purchase. However, it is not out of the ordinary to see them be between $1000 and $2000.

Home Inspection

It is advised – but not required – that you obtain a home inspection before you buy the home. In Arizona, you typically have a 10-day period when the contract is first accepted to complete the inspection and other standard inquiries related to the suitability of the home. A home inspection gives you detailed information about the overall condition of the home. A qualified inspector will do a thorough examination of the home to make sure that it is not hiding any structural, mechanical (ex. air conditioning unit) or other issues. The inspector will identify any items that need to be repaired or replaced. Note that an inspection is not an appraisal; it doesn’t give you an opinion of value. The cost of the inspection depends on the type, size and location of the home. It is not out of the ordinary for a home inspection in Arizona to cost between $200 and $600.

Termite Inspection

As the name indicates, a termite inspection is a visual inspection of the home for evidence of wood-destroying insects. It is usually paid for by the seller of the home. However, the Arizona the purchase contract states that if the lender requires a termite inspection, it will be paid for by you, the buyer. A basic termite inspection will probably cost around $100.


Like a home inspection, a survey is not required. If you aren’t sure if you should have a survey done, you should seek the advice of your real estate agent. When you complete the purchase contract, you will specify if the survey will be paid for by you and/or the seller. A survey is an assessment of property lines to determine the exact amount of land that is part of the property. The survey will show any easements or encroachments on a property. A survey could cost around $600.


When you are obtaining a mortgage, you will be required to obtain an appraisal. The appraisal is an independent opinion of value. It will document the reasons the various things that impact the value of the home such as the condition of the home, any unique features, the neighborhood and recent comparable sales. Most lenders will allow you to pay for your appraisal with a credit card and many will allow you to pay it at closing. An appraisal usually costs between $400 and $500.

Credit Report

A credit report is a detailed report of your credit history as reported by the three major credit bureaus. You may not be required to pay for the credit report upfront. If you are, the lender typically allows you to pay for it with a credit card and many will allow you to pay it at closing. It usually costs between $10 and $20.


Jeff Barchi has been a REALTOR® and one of the best real estate agent Arizona expert and managing homes for sale in the Greater Phoenix area since 1999. He is ranked in the top 1% of all real estate agents in Arizona in Greater Phoenix, two time winner of top 40 Realtor AZ under 40 award, and the top 2% of all agents nationwide. In 18 years Jeff, as a leading Arizona real estate agent, has participated in approximately 900 transactions, i.e. homes for sale in Arizona, averaging approximately 50 per year. To put this number in perspective, the average Realtor AZ closes 11 transactions per year. If you are looking for the best real estate agent Arizona expert, Jeff Barchi is your guy. His real estate firm has been praised as the best Phoenix real estate company, he has been a very successful Scottsdale real estate agent and Paradise Valley Realtor.