It isn't just the buying price of a home that has risen in recent years. The cost of owning and maintaining a single-family home is way up, too.
Bankrate recently published its Hidden Costs of Homeownership Study,, which examines the costs of property taxes, homeowners insurance, labor and materials for maintenance and repair, energy, internet, and cable. Compared to four years ago, homeowners are paying 26% more to maintain and run a single-family home.
On average, this adds up to $18,000 for all 50 states. That's around $1500 per month on top of a mortgage payment.
Why the Increase?
Since 2020, everything has gotten more expensive. The median price for an existing home has gone from $280,700 to $393,500. Cumulative inflation has increased by 21%, and insurance premiums have soared.
Rising home values (up 21%), increased construction costs (up 17.5%), and natural disasters (up 83% since the start of this century) are all impacting these figures.
The cost to own and maintain a home in Hawaii has risen the most with an average annual cost of $29,015, but everything is more expensive in Hawaii.
In Virginia, costs have risen 23% from $14,406 in 2020 to $17,647 in 2024 (a difference of $3,241).
What does the term "Home Maintenance" Cover
When you consider home maintenance, you think of things like changing the air filters, changing the batteries in your smoke detectors, and mowing the lawn. The list, though, is far more extensive. There are over 100 tasks that should be included annually to take care of your home, regardless of its size, age, or location.
Here's a look at just some of them:
Heating, venting, HVAC
Laundry Machines
Water softeners
Appliances
Water heaters
Smoke, carbon monoxide, and radon detectors
Electrical outlets, breakers, panel
Humidifier, dehumidifier, sump pump
Plumbing, disposal
Doors, cabinets, windows
Fireplace(s)
Garage doors, sensors
Railings and walkways
Driveways
Trees and landscaping
Gutters, external vents
Paint, floors, walls (cracks, scars, touch-ups)
Fixtures (faucets, doorknobs, handles)
When you look at this list and then the tasks involved in completing the needed tests, inspections, and tasks - there are over 100 steps.
How Do I Budget for Home Maintenance?
Many homeowners will set a monthly budget that includes mortgage, insurance, power and internet, but they will forget to factor in maintenance costs because they are not top of mind.
You can, however, come up with a reasonable estimate of how much you need to save to maintain your home each year and set aside some emergency funds.
Three Maintenance Budgeting Rules
There are three rules that financial advisors use to help homeowners budget for their annual costs of home maintenance.
The 1% rule: Calculate one percent of the total purchase price of your home and set it aside for regular maintenance. For a $600,000 home, this would equate to $6,000 annually or $500 per month.
The Square Foot Rule: Save one dollar for every square foot of your home. For a 2,000-square-foot home, this would mean you put aside $2,000 a year, or $166 per month.
The 10% Rule: Set aside 10% of all of your main monthly expenses (mortgage, taxes, and insurance). For example, with a mortgage of $3,000 per month, taxes of $600 per month, and insurance of $300 per month )for a total of $3,900), your home maintenance budget should be $390 per month or $4,680 per year.
Other Factors to Consider
A number of external factors can affect the cost of your home upkeep, so if you face any of these, you may want to add another 1%.
Water: If your home is located near water, you face specific issues such as mold, dampness, and seepage.
City: If your home is in a large city, your home can be impacted by air quality and vibration.
Climate: If you are in a very cold or hot environment, your heating and cooling systems will probably have a shorter lifespan and require more maintenance.
Remote Location: Available service providers and material availability can impact the timing of repairs, which can delay repairs and cause greater damage.
Age of Home: Homes built between 1960 and the 2010s cost an average of 5% of home value to maintain. Newer homes cost an average of 3% to operate and maintain (primarily because the home values are much higher)
Home Repair Emergency Fund
None of the figures above calculate unexpected home repairs or replacements. If your freezer suddenly dies or your HVAC quits in the middle of summer, you may not have the funds handy to replace them if you don't plan ahead.
The National Homebuilders Association (NHBA) suggests homeowners set aside 1% to 3% of their home value for emergency repairs. So, if your home is worth $500,000, allocating $5,000 - $15,000 should cover most needs.
Some financial advisors take it one step further and advise having a general emergency fund for the home and a "dire emergency" fund.
The general emergency fund is for everyday emergencies, such as needing a new hot water heater or dishwasher. These expenses can cut into your monthly budget, so having this cash stowed away will allow you to "stresslessly" pay your mortgage and cover your unexpected payments.
The "Dire Emergency" fund is for life's disasters, such as losing your job or falling ill. These catastrophes could greatly increase the risk of losing your home. Experts say twenty percent (20%) of your mortgage balance should be set aside "just in case."
If you don't have an emergency fund or haven't been able to build it up to a comfortable level, you have options for securing funding to help with emergency repairs. A home equity loan or a home equity line of credit may be available and let you tap into the value of your home.
How Can I Reduce My Home Maintenance Costs
Every homeowner will face an emergency repair at some point. Regular maintenance and proactivity can help.
Make Repairs Early: A dentist once said, "If you wait until it really hurts, it's too late." The same goes for home repair. If you see a problem, fix it right away. Don't wait until it becomes a major repair. If you see a water spot on your ceiling, call a plumber or roofer. If you see loose mortar around your bricks, call a mason. The sooner you take care of a problem, the less you'll pay to have it fixed.
Hire The Best You Can Afford: It is tempting to take the lowest bid from a contractor, but with home repair, the saying, "You get what you pay for," is usually spot on. Get referrals, check for licensing, and be onsite for all of the work. Doing your research ahead of time will keep things moving along and save you headaches in the long run.
Schedule Your Preventative Maintenance: Mark your calendar for specific tasks that need to be performed every year and stick to the schedule. Replacing batteries in your smoke and carbon monoxide detectors, tune-ups on HVAC systems, gutter cleaning, roof, and fireplace inspections, etc. If you can catch a potential problem before it becomes an actual problem, you'll be ahead of the game.
Seasonal Inspection: You don't have to hire a professional to come out to your home and look everything over. You can do it yourself. Every season, walk through and around the outside of your house and check for water or fire hazards, such as pooling water or frayed wiring. Make sure no tree limbs are touching the house and that your gutters aren't clogged. Look for any tripping hazards, such as cracks in sidewalks and driveways or exposed tree roots. You'll know a potential problem when you see one and can have it addressed before it becomes an issue.
Figure Out What You Can DIY: Some people look at a power drill and say "no thank you," while others think it is a great tool for tackling a plethora of problems. If you are comfortable using power tools or even just a paintbrush, think about what you feel you can do yourself so you don't have to hire someone else. Maybe you can touch up the paint on your siding or would prefer a professional to do it. Write out what routine repairs or maintenance you can do and what you should leave to professionals. Keeping a list is the main point, whether you can do the tasks yourself or not. When it comes to major systems like electrical, HVAC or plumbing, unless you are licensed, you should probably leave this to those who are.
At the end of the day, being prepared for emergency repairs and knowing what your home needs to keep it in its best condition is all about preparation, awareness, and diligence. Having a home of your own is the American Dream. Maintaining it well allows you a good night's rest.
Sources: Yale Digest, Bankrate, Homekeep, Realtor.com,
.png)
Komentarze