Operating costs — the hidden item that decides whether you can afford it

The bank’s mortgage calculator shows interest and amortisation. The estate agent’s listing shows the asking price and the monthly fee. Neither gives you the full picture of operating costs (driftskostnader) — the bank uses standardised estimates in its affordability assessment (KALP — kvar att leva pa), but the simple calculators rarely show more than interest and amortisation. And for house owners, running costs can be the single largest item beyond the loan.

House versus tenant-owned apartment — different cost profiles

A house owner pays separately for electricity, water and sewage, waste collection, home insurance and other recurring items. These costs vary depending on the property’s size, condition and location.

For a tenant-owned apartment (bostadsratt), water, waste collection and property maintenance are normally included in the monthly fee (avgift). Additional items are primarily electricity and home insurance with the co-operative apartment supplement. The difference in operating costs between a house and a tenant-owned apartment can be substantial.

The heating system matters

What type of heating the house has affects the operating cost. There are large differences between systems, and it is an important question to ask when buying a house. Ask the seller for actual operating costs from the last 2–3 years to get a more realistic picture.

Most properties for sale should have an energy performance certificate (energideklaration) stating the energy performance rating and energy class. The certificate shows the building’s energy performance — a normalised value that does not correspond to what the previous owner actually paid. Actual costs depend on the household’s behaviour and current prices. Some banks offer more favourable mortgage terms for properties with a high energy class.

Three mistakes to avoid

Forgetting operating costs entirely is the most common — the bank’s standardised estimate in the affordability assessment rarely matches the actual cost for your specific property, but the bills have to be paid every month regardless. Trusting the estate agent’s figures blindly is the second most common — the declared operating costs apply to the previous owner under different circumstances. And not asking about the heating system can lead to unpleasant surprises.

Operating costs are the item most often missing from a quick mortgage calculator. In a buy-versus-rent comparison they change the picture considerably — a rental typically includes more running costs in the rent.

Start from your property type and size, adjust each item to your circumstances, and see how operating costs affect the total cost of living. In BoKalk it is included in the overall calculation.

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Christoffer, founder BoKalk