Last Updated on October 25, 2026

A fixed-rate loan can make a rental feel predictable. Then the insurance renewal arrives, the tax bill changes, and the water heater develops impeccable timing.

The principal-and-interest payment may stay put. That does not mean the property’s total monthly cost will, especially when taxes and insurance move through escrow. Before building next year’s budget, check the expenses that never promised to sit still.

The costs outside principal and interest

Zillow and Thumbtack’s October 22 analysis puts annual ownership costs for maintenance, property taxes, and insurance at $16,566 for a typical U.S. homeowner, or about $1,380 a month. Its national estimates comprise $11,171 for maintenance, $3,129 for property taxes, and $2,266 for homeowners insurance.

The report identifies insurance as the fastest-rising category over five years: premiums increased 54%, compared with 32% for maintenance and 19% for property taxes. These are cumulative five-year changes, not increases to apply to next year’s budget.

Treat the findings as a prompt, not a prescription. Zillow estimated taxes and insurance for typical homeowners across 30 metros, while Thumbtack’s maintenance measure is an unweighted index of projects based on reported costs. This is not a survey of rental-property operating expenses or an allowance every landlord should adopt.

Your property needs its own numbers. A newer townhouse, an older detached house, and a small apartment building should not inherit the same maintenance assumption simply because they share an owner.

Start with the bills, not the benchmark

Pull the latest insurance declarations and renewal notice, the property tax bill, and a full year of maintenance invoices. Check each amount against what actually cleared the bank.

For insurance, compare like-for-like coverage, deductibles, exclusions, and policy terms before deciding that a cheaper premium is a saving. Ask your insurance professional whether the proposed coverage fits the property’s rental use. A smaller bill with a larger uninsured exposure is not the same bargain.

For taxes, distinguish the current bill from your estimate for next year. If you are evaluating an acquisition, ask the local assessor or a qualified adviser how a sale could affect the assessment rather than assuming the seller’s bill will carry forward unchanged.

Then check escrow. If taxes and insurance already sit inside the total mortgage payment in your cash-flow model, do not add them again as separate outflows. Separate principal and interest from escrow first, then count each cost once.

A small increase can take a large bite

Consider an illustration, not a market forecast. A property has $400 a month left after its budgeted costs and reserve contributions, or $4,800 a year.

Now suppose annual insurance rises by $600, taxes by $360, and the maintenance allowance by $480. Together, those changes add $1,440 a year, or $120 a month.

With rent and every other assumption unchanged, the monthly surplus falls from $400 to $280. That is a 30% reduction in the original cushion without a single change to the loan’s principal-and-interest payment.

The point is not that these increases will happen. It is that modest changes deserve attention when the starting margin is thin. Test your own known renewals and estimates, and label uncertain amounts clearly.

Separate upkeep from the next big replacement

Do not let one quiet year convince you that the roof has stopped aging. Build an ordinary maintenance allowance from the property’s history, then list larger replacements separately with estimated timing and quotes where available.

Keep three buckets distinct: expenses already paid, expected recurring costs, and money reserved for future work. Moving cash into a reserve is not the same event as paying a contractor, and counting both as the same expense can distort your review.

Tax treatment is another distinction. The IRS separates repairs from improvements, with improvements generally recovered through depreciation rather than treated as ordinary repairs. Ask your CPA about the specific work and any applicable rules before assuming a large invoice produces an immediate deduction.

Request itemized descriptions while the project is fresh. “Work completed” is a poor substitute for knowing what was repaired, replaced, or upgraded.

Turn the review into a repeatable habit

Use actual records to establish the baseline. Stessa’s reporting workflow lets you select an Income Statement, choose a property and date range, view monthly columns, and inspect underlying transactions.

Review matching periods, especially when insurance premiums or taxes land in one large payment. Then prepare a separate forward-looking budget using renewal notices, estimates, and planned work rather than altering historical transactions to fit a projection.

Before you finish, write down the three assumptions most likely to change and when you will check them again. Give each an amount, a supporting document, and a review date so the next budget update starts with evidence.

You do not need a national average to tell you what your rental costs. You need current bills, clean records, and enough room for the expenses that refuse to stay fixed.