But insurance remains a pain point in higher-risk metros
Pandemic-driven increases in the cost of owning a home may be easing, but Sam Williamson, senior economist at First American, said the slowdown is not reaching every market equally.
Based on his review of American Community Survey data, Williamson said the broad surge in taxes, insurance, and utility costs that weighed on homeowners in recent years appears to be fading. Still, he pointed to homeowner’s insurance as the clearest remaining source of strain, especially in places already exposed to higher climate-related risk.
“Some of the steepest increases occurred in markets where insurance costs were already high. In storm and hail prone metros, such as Dallas and Denver, premiums climbed roughly 17%, pushing average monthly costs above $230. In wildfire exposed California markets, including Los Angeles and San Diego, premiums increased about 16% as insurers pulled back from high-risk areas, lifting monthly costs above $160.”
Williamson’s analysis found that the average monthly cost of owning a single-family home rose 4.6% in 2024 to $1,789. That total includes mortgage payments, taxes, insurance, utilities, and other related housing costs. While still an increase, it was smaller than the gains recorded in the previous two years.
He noted that the more telling figure for many existing homeowners is the change in recurring ownership expenses rather than full monthly housing costs. On that measure, property taxes, homeowner’s insurance, and utilities rose 2.6% in 2024, the slowest pace since 2020.
Insurance accounted for much of that pressure. Nationally, homeowner’s insurance premiums increased 11% to $147 per month in 2024. That was still substantial, but lower than the 16.3% increase posted in 2023, indicating that premium growth may be starting to level off.
Property taxes also grew more slowly last year. Nationally, they rose 2.7%, down from 4.2% in 2023. Williamson tied that moderation to cooler home price growth, though he said some pandemic boom markets continued to post sharper increases as local reassessments caught up. He identified Las Vegas, Denver, Raleigh, Tampa, and Orlando as places where tax increases remained well above the national average.
Meanwhile, utilities offered the clearest sign of relief. National utility costs fell 0.7% after large increases earlier in the pandemic period. The biggest declines were seen in Midwest metros, including Indianapolis and Minneapolis, while costs in the West continued to rise, though not as quickly as before.
Williamson said there may be more relief ahead if current trends hold.
“After slowing in 2024, further easing may be on the way. Slower house price growth in 2025 should help moderate property tax increases as assessments adjust. Insurance premium growth appears to have stabilized nationally, though higher risk markets remain vulnerable to further hikes. Utilities may provide additional relief, but remain the most volatile component of ownership costs. Taken together, these trends suggest the pandemic era surge in taxes, insurance, and utility costs has likely passed.”
Even with that moderation, the analysis said ownership costs remain elevated, but the slower pace of increase could give household incomes more room to catch up than they had during the sharp run-up of the past several years.
