There’s a lot of talk these days about “affordable housing,” which is understandable given how much home values have risen in 2021 alone.
But, when it comes to affordability, the cost of acquisition, while important, is not the only factor home buyers need to consider.
Home maintenance is something all homeowners need to budget for, yet many are caught off guard when issues — and their associated costs — arise.
21% of millennials, for example, indicated in a recent Bankrate survey that their #1 regret during the home-buying process was underestimating the costs of maintaining a home.
So, that begs the question: how much should you budget for home maintenance every year? Here’s how to plan for the inevitable.
Start with the Rule of Thumb
The general rule of thumb is that you should budget at least 1% of your home’s value for annual upkeep.
For a $600,000 home, for example, that would equate to $6,000 in annual maintenance costs.
This number is supported by Home Advisor’s State of Home Spending report which shows the average cost of annual upkeep at just over 1% of the median US home value.
While 1% may be adequate for many (it’s better than not saving at all!), some homeowners should consider saving even more: 2%, 3% or potentially 4% annually.
When to Budget More
The reality is that every home is different in terms of age, construction, and condition.
Max Anderson, Product Director at Porch Group, for example, suggests that homeowners with homes older than 30 years, located in a humid climate (like ours in Southern Ontario), and built with lower-life materials such as wood siding and asphalt roofing, should skew toward a 3% budget.
(A newer home or a condo, by comparison, would require very little in the way of maintenance.)
You’ll also need to factor in the cost of replacing your home’s appliances and fixtures. A SMEG fridge, for example, will cost 3-4 times more to replace than an entry-level Whirlpool.
Fine-Tuning Your Budget
If you want to get away from broad-brush predictions and nail down your maintenance budget, you’ll need to understand your home’s systems, their condition, their expected remaining lifespan, and their estimated replacement costs.
To help, here are the average lifespans of your home’s systems:
- Roof (asphalt shingles): 15-30 years
- Roof (metal): 40-70 years
- Furnace: 20-30 years
- AC: 12-17 years
- Water heater (tank): 8-12 years
- Water heater (tankless): 20 years
- Garage door opener: 10-15 years
- Windows (wood): 20 years
- Windows (vinyl) 20-40 years
- Vinyl siding: up to 60 years
- Washing machine: 13 years
- Dryer: 13 years
- Refrigerator: 13 years
- Range: 14 years
- Dishwasher: 9 years
(Source: Rocket Homes)
An Ounce of Prevention
To ensure your home’s systems meet or exceed their expected lifespan, make sure you work preventative maintenance into your budget and planning. While professional services such as AC and furnace tune-ups will cost money, there are many actions you can take for free that will keep your home in proper working order and, ultimately, save you money.
Done is Better Than Perfect
Obviously, you won’t be able to pinpoint the exact moment and replacement cost of every single item in your home. And, there are going to be fixes not on this list (such as leaky pipes, faucet replacements, etc.) that you can’t predict.
However, by budgeting and being proactive where possible, you’ll be prepared for the inevitable and the unexpected.