home maintenance - learn from my mistakes

[ladykemma2]

when my accountant friend set up my post divorce budget she said to put aside monthly 1% of the value of the home for home repairs and maintenance.

well, twern't nuf. i had been setting aside 110 dollars a month, but my monthly repair bills were more like 250-500 a month. it seems that everything in the house was breaking at once. I made the change, and now feel like I can breathe without panicking and saying "what's going to break next?"

so now, after some research, i learned that in an aging house, smart people set aside 3-5% of the value of the home monthly for repairs. Source: "This old house" and a few others. For an historic home more like 10%.

any thoughts?

[StaceyS]

Wow! That seems like a lot to me! I'm thankful I'm a renter!

[ladykemma2]

yeah, i agree. when i paid off the mortgage, the home was relatively new, so didn't have all these repairs.

now the house is 15 years old. all the appliances broke this year. hopefully, this the end of the run. however, i was told the A/C is on its last legs.

my home expenses are monthly

escrow (taxes/ins) 400
trash 16
home maintenance 250
hoa 33
flood insurance 21
ac heat mainte 30
total 750

[StaceyS]

Oh! You don't have mortgage! That would be SO nice! You pay what I do and I could get kicked out at any moment... I would LOVE to own a home, but it's just not feasable in the near future...

[ladykemma2]

everybody: repeat after me:

"appliances die after 15 years" ..... (so, who knew?)

Plan ahead! Since january i have replaced or repaired the garbage disposal, the squirty thing on the kitchen sink, the toilet innards, the washer, the dryer, the refrigerator, a light fixture, a bathroom faucet, the water heater.

[FrugalMomof3]

I am jealous you have no mortgage but $700 a month isnt that bad as long as your needs are met and you have the bills paid and everything.

[dolphin]

Well, we were never told to set aside any percentage for home maintenance and never thought of it so you're way a head on this one. Sorry you had all of your stuff go bad at once. Hopefully, twill be no more bad stuff for a long time.

[ladykemma2]

i checked my math and meant to say:

3-5% of the value of the home ANNUALLY divided by 12

so if my home is worth 110,000, 3 % is 3300 /12 = 275

5% is $458 monthly.

[PrairieRose]

Man it stinks when this happens. We bought my family home from my parents. It had been impeccably maintained and all was in good shape but the appliances were getting old. Welp, sure nuff, about 2 years after we moved in, in a 12 month period each one died a slow painful death. We thought we'd starve before that year ended. I surely feel your pain At least you'll be good to go for a good while now (looking for the upside here).

[ConnieD]

Wow......... great post!! Thanks! I knew I wanted to have money set aside for stuff like this, but never actually allocated a weekly amount in a separate "account".

LOL..........and thanks for clearing up the math.......... I was a little concerned thinking there was no way I was going to be able to come up with that much extra a year....LOL!!!

We built our house 16 years ago. We replaced the roof a couple years ago, but I'm sure the furnace and air conditioner are going to bite the dust sooner than later. Last Dec we had to replace the hot water tank and our washing machine is only a year old.
........... although my fridge is 19 years old and my stove & dishwasher are 16 years old.

Yikes.......... looking at it all written down is a bit freaky. I DEFINITELY need to get saving.......... NOW!

[forHISglory]

Ya know.... I really think that after we go to bed at night, the appliances and fixtures and house structures all get together for a good time and decide how to best frustrate us. Can't you just hear them:

Fridge: Say, Oven, isn't your turn to go on the blink?
Oven: Let me check. Nope, I've got another month. Maybe Dishwasher could take a turn....

I had not heard the percentage to save each month, but your advice makes sense. Looking back, it really does take quite a bit to keep everything in tip-top order. And some things are so expensive!

[Ebbie]

This is a really good post because it gets one thinking about the costs of home ownership. I know when I bought I didn't really think about the cost of fixing and maintaining and I'd never before heard the concept of 1 to 5% of the cost of the house. So good for bringing it up.

I do know that in the 14 years I've owned my house I've:

- replaced the roof (twice)
- replaced the water heater (twice)
- the dishwasher broke (never got it repaired, just started handwashing)
- replaced the refrigerator
- had new eavestroughs put on
- replaced the tub faucet
- replaced the sliding door
- replaced the washing machine, and had to have it repaired once
- repaired the laundry room drain
- replaced one toilet and sink
- had a few electrical recepticles and light fixtures fixed/replaced

There are lots of repairs that still need attention...these were all things that needed immediate attention.

[ConnieD]

Oh my goodness............ it's so true, eh? I LOVE the percentage way to figure how much to save. Home repairs and stuff like that are NOT what I want to be using my emergency fund for.

They are something that you know is going to be needed at some point, so it's best just to budget it out ahead of time and then you're ready for them, whatever goes first

............. saving the emergency fund for actual emergencies (ie. car accident, job loss, sudden illness, etc....)

I LOVE having money in the bank and having that "prepared" feeling. Nothing felt better than paying off our consumer debt, paying cash for our car, etc..... Five more years (hopefully less) and the house is paid off.
I'm so thankful that we got on the frugal bandwagon (wish we'd done it sooner). Living like everyone else (and all their rising debt just to have "stuff") can't even compare to how it feels to be debtfree.

Okay, LOL........ I've head off on a tangent here but I just wanted to encourage EVERYONE here to STAY THE COURSE and make the sacrifices to be debtfree! When it's all said and done, you'll be SOOOOOOOOO glad you did!!!

[Dad_of_4]

We have never owed a house that was not a fixer upper. But a much easier way to do this is to just have an emergency fund for every thing. Most repairs are not more than $1000 especially if you DIY. An exception is the roof, but you can plan for that because roofs last between 15 and 20 years. If more than one appliance breaks, repair/replace the most used one first. The other can always wait.

Repairs that we currently have on our list:

Replace Roof (only 6 months old golf ball hail destroyed it)
Replace Fascia/ rain gutters (same as roof)
Build new shed (was falling down when we bought house)
Rewire all recepticals (worn out/ no ground)
Remodel Kitchen (very little counter or storage)
Remodel main bathroom (pink tile need I say more)
Insulate crawl space (will do little by little)
Plus tons of little stuff I pick off one or two at a time.

Most things give you a little warning, others just jump up and bite you. But an emergency fund should cover most things.

[Greebo]

The formula I use on investment properties:
New - 5 years: 5%
5 - 15 years: 10%
15+ years: 20%

That is 5, 10 or 20% of the rental income goes to a "maintenance" fund. Now these are somewhat higher, because on average, renters tend not to be too careful about properties.

So if you cut those #s in half and apply them to your mortgage, annually, well, on a 100,000 house that's 2,500, 5,000 or 10,000, based on its age, to put aside for maintenance issues.

Which is about right to my thinking - a 15 year old home is starting to get on the "need new major appliances" list - like furnace, a/c, water heater, etc.