House maintenance

[Maistre Gracey]

How much do you budget for UNEXPECTED maintenance for your house??

I have read anywhere between 1 - 2 % per year of the value of your home.
I’m not sure how realistic that is. I’m a bit paranoid I’m going to get hit with a large unexpected bill, yet I have money, possibly not needed, accumulating in that budget over the years.

Thoughts??

 

[mom-2-3]

Just from my own experience, not any formula, think about what could go wrong, and start there. ie what is your HO deductible $500, 1000, etc. what appliances are aging and cost to replace; are you on well and/or septic, costs for repairs / pumping. In the wee hours of the morning, these are my thoughts. If I’ve misunderstood your question, sorry.

 

[WDW_fan_in_TX]

I worry about this all the time. We rent, but what happens if the fridge or stove or washer/dryer goes out? I know we have our $1k EF to be able to replace something like that, but is that really enough to go down to the local furniture store and buy a fridge or washer/dryer? Not really.

I'd like to start a sinking fund for home repairs. Like our landlord will fix a leaky faucet, a messed up water spigot outside or something like that. Like our toilet upstairs started leaking a few weeks ago, and he came and replaced the wax ring and tank lever (where it was leaking). But if our washer/dryer, stove, fridge goes out, that's on us.

 

[spol]

I worry about this all the time. We rent, but what happens if the fridge or stove or washer/dryer goes out? I know we have our $1k EF to be able to replace something like that, but is that really enough to go down to the local furniture store and buy a fridge or washer/dryer? Not really.

I'd like to start a sinking fund for home repairs. Like our landlord will fix a leaky faucet, a messed up water spigot outside or something like that. Like our toilet upstairs started leaking a few weeks ago, and he came and replaced the wax ring and tank lever (where it was leaking). But if our washer/dryer, stove, fridge goes out, that's on us.

If you rent, why are you responsible for the appliances in your house? Did you buy them and bring them in? When I was a renter, I wasn't responsible for any of those. Is this spelled out in your lease?

 

[Kestryl]

While we knew they were aging, it was sort of unexpected that we had to replace the roof ($12,000) and both our HVAC systems (split, $9000 and $12,000) in an 18 month period. Which was about 13% of what we bought the house for.

I know it’s unlikely we’ll deal with all 3 again for a while, but that’s kind of the baseline I try to keep in mind to make sure we have enough available. (That, and we have a septic system, so I live in fear of that failing…)

 

[WDW_fan_in_TX]

If you rent, why are you responsible for the appliances in your house? Did you buy them and bring them in? When I was a renter, I wasn't responsible for any of those. Is this spelled out in your lease?

It's spelled out in our lease that we're responsible. They're responsible for repairs (if repairs are possible), but we're responsible for replacing the appliances.

 

[spol]

It's spelled out in our lease that we're responsible. They're responsible for repairs (if repairs are possible), but we're responsible for replacing the appliances.

Oh my. I've never heard of that before!

 

[firefly_ris]

It's part of our general emergency fund. I look at what we replaced and when, life expectancy of each item and how much it would ballpark cost to replace each one and then make sure there is plenty in the general EF to cover.

For example our septic system is original to our 1963 home. It could go another 20 years, or it could need a new leech field tomorrow. Full-on replacement would run us about $11k in these parts. We put in a new water heater when we moved here in 2012 so that is coming up on its "expected" lifetime, it might not, but keep money in the EF to cover it. We do 99% of all home maintenance and repairs ourselves (except aforementioned septic!) so it's a little easier to predict, because I can just look up part costs and don't need to factor in how much labor could be. Long story short we keep 1 to 2 years worth of regular annual expenses in the EF and it's just generalized so we can cover things as they appear, which is usually at the most inconvenient time. If we have to pull a sum from the EF to pay for said thing then we just prioritize getting that money back into the EF asap.

There is probably a smarter way to keep that sorted, but I just try to keep a big pot to make sure we are good, has been working so far...

 

[WDW_fan_in_TX]

Oh my. I've never heard of that before!

It is what it is, and honestly, we're fine with it. We have the EF for those types of things should any issues ever arise. And we absolutely love our landlords. We've been here 3-1/2 years now. And DW and I were talking not long ago, and we decided we want to stay as long as they will let us. It's in a great location (35-minute drive to DW's work and 25-minute drive to my work), we're just down the road from a great church and we love our community. And our landlords will do anything we ask at the drop of a hat, even though they live an hour away.

 

[firefly_ris]

Oh my. I've never heard of that before!

We always supplied appliances to our tenants, with the exception of a washer/dryer -- we had a double and rented out the upper. We split our basement in half and so the tenants got the other half, to which we supplied a washer/dryer hookup, but if they wanted to utilize they had to bring their own machines (they did). We did the same thing at our college rental; we supplied a fridge and stove but washer/dryer were on them. If anything we supplied broke we were of course responsible for it, but if the tenant's washer broke they had to decide on its replacement.

However, I have definitely seen units in the area for rent that don't have any appliances provided at all, which was legal in our part of NYS. Rent price was typically reflected in that with a generally lower rent. It's been years since we've been landlords so not sure if it's changed since then.

 

[tx911]

I try to keep 3-6 months worth of monthly expenses in an emergency fund. If a sudden appliance issue or other problem arises, I’ll draw from that and then replenish when able.

 

[CallMeAFlower]

We always supplied appliances to our tenants, with the exception of a washer/dryer -- we had a double and rented out the upper. We split our basement in half and so the tenants got the other half, to which we supplied a washer/dryer hookup, but if they wanted to utilize they had to bring their own machines (they did). We did the same thing at our college rental; we supplied a fridge and stove but washer/dryer were on them. If anything we supplied broke we were of course responsible for it, but if the tenant's washer broke they had to decide on its replacement.

However, I have definitely seen units in the area for rent that don't have any appliances provided at all, which was legal in our part of NYS. Rent price was typically reflected in that with a generally lower rent. It's been years since we've been landlords so not sure if it's changed since then.

It's totally dependent on local laws. In my state it's required by the minimum living standard- a working stove, refrigerator, and cold water must be supplied by the landlord. In other states it's only required to provide working hookups.

When we were renting, any repairs or fixes not covered by our landlord came out of our emergency fund. Now that we own a fixer upper, we try to keep around 30k in a separate high-yield house fund. Considering we've already replaced the roof, the siding, the windows, the driveway, and one of the bathrooms... Old houses love to spring expensive surprises! It sounds like a lot upfront, but our mortgage is cheaper than the rent we were paying so that difference goes into the fund, same with what we were previously saving weekly for the initial downpayment. It took a few years to get to that number, but we feel safe with that based on the cost of the previous issues. This total to save may be different for you depending on where you live too- I live in a medium-high cost area so things are much more expensive!

 

[barkley]

we have 2 resources for these-

our sinking 'reserve' account which we put a set dollar amount into each month to cover all of our irregular non monthly expenses which include the known home maintainance-pest, yard (multiple acres), yearly generator service, biennial water filtration/softner service , HVAC service plan (has saved us SO MUCH over the years)... I plump the dollar amount by a few hundred a month to cover smaller unexpected expenses like the electricians who had to replace a couple of failing GFI outlets in the last few months. anything unused rolls over year to year so that helps,

and

our 'emergency/liquid savings' which is about 6+ months of household expenses or 5% of our home's approx. value.

 

[kathy884]

I keep 10K in a money market fund for unexpected home repairs and improvement (shoot extra monies in there if that gets below that), and as part of my monthly budget I allocate $300 a month to the home repair fund (means I let it build up over 10K). For us that is less than 1% of our home's value, more like .85% a year specifically allocated for that. Do note though that if I have enough in normal discretionary monies to pay for minor things on the home I do and I only go into this fund if home repairs are leaving me tight for the month. Do note that we did a new roof just three years ago and that should last for my lifetime, so I don't have something big like that coming up.

If I have a special big project that I am planning to do that isn't a necessity more like an improvement that I would like to make, I put additional discretionary monies I have at the end of the month that are not part of my normal monthly budget and savings goals toward that and save for that separately. For example we are having our cedar deck torn out (We put it in, in 1990 and are replacing with with a steel frame and that plastic decking material with a drink rail - will be much less work to maintain. We are also going to make the new deck larger length wise than the old deck by about four feet and this project is a big one for us, is going to run about 30K. I saved up discretionary monies separately for that outside of the home maintenance fund, putting any extra I had per month that wasn't allocated to other things in that, put a few bonuses in that too, and pulled in my home maintenance fund monies that were above my 10K threshold to build that up, and then signed up to do the optional home improvement project when what I wanted to do was funded. It took me about 10 years to fund that, so if you look at numbers that was about $250 a month in discretionary monies not part of my normal budget that I put in there for that time period on average.

So if you look at what extra I put over and my monthly budget for the home lol that is about 1.5% of our homes value a year meaning your 1-2% actually kind of hit the mark for us, but covered maintenance and improvements (and we actually covered little stuff with other monies from our income).

 

[cookiecar]

We plan about 2% ($15k) a year for planned maintenance and unplanned repairs.

 

[Anthony1971]

a question with many answers...
What is your idea of Maintenance and what can or will you do yourself.
Kitchen cabinets have an expected life that does not mean they are unusable it means they are worn or out of style....
Roof well that is set time you have to replace or you will have the bonus of damage repair.
What can you do your self? OP mentioned GFCI outlet know how? 10 minutes and 25 bucks. Don't know but willing time plus 25 bucks..... Electrician depends on the area and how reasonable the one you call is.
For the record I partially paid for my college education working in construction with the exception of a roof and HVAC there is little I am not capable of doing myself when I don't want to for a large project or? I know what needs to be done and have a good idea of how I want it done.... will happily ask a person to leave when they try to sell some BS.... Like when a roofing company wants to inspect your attic to see if you need a new roof.
with that preventative is king... Learn how to drain a few buckets of water from a hot water heater, Clean the inside and outside coils of your AC system (contracts will also include the outside at least) learn how to clean a boiler very easy, Vacuum the coils under a refrigerator bonus if you buy the 6 brush HD sells, clean dryer vents, clean gutters - a blower or shop vac they sell extensions- and more. Most things are 10-15 minute jobs every year or 6 months with some things.... This is what I consider general militance...
If you can do them then hey appliance easily 10 years (20 in many cases), roofs 25-30, AC 15-25 Boilers a very long time...
if you need to pay to maintain of all and Kitchen cabinets are a normal replacement then a % of 2-3% is a better goal.... The % is based on simply the grade of what is in your house while an HVAC system is an HVAC system price with some variance.... A kitchen in a million dollar house to expected to have higher end cabinets and will easily cost 2-3 times more than a similar size house with builder grade.

 

[OrangeBirdGirl]

I'm not sure what you are considering maintenance. If you aren't doing standard maintenance, and hire it out, then easy to figure out the costs. Like if you don't clean your dryer vent, what's that cost? If you don't do the furnace/ac tune up, what's that cost?

If it's more of a maintenance in the fact something breaks and you need to replace it, then I guess you need to look at the higher priced items in your house that would need to be replaced and go from there. I'm thinking furnace might be largest cost item.

When those things that need replacing come up for us, then we just get it replaced and take the money out of our regular savings account. If it is more of an upgrade/renovation we want, then there'd be more discussion on what we would want to do (hasn't come up yet for us). Where when our fridge broke, 2 options repair or replace. Looked into repair but even DH doing it himself the part was $600 and not worth it, so we bought a new fridge. That was an immediate need to get it done. When our dryer had an issue, DH troubleshoot it, found the part online for $30 and the next day our dryer was working again.

One of my friends has a home warranty, I don't know what she pays for this but it covers all repairs on any appliances, furnace or AC. I also believe it her a check towards a replacement unit if they felt the cost was too high to repair. This warranty might be of benefit to some if they are just starting out and don't want to be surprised with a huge bill when something goes.

 

[barkley]

One of my friends has a home warranty, I don't know what she pays for this but it covers all repairs on any appliances, furnace or AC. I also believe it her a check towards a replacement unit if they felt the cost was too high to repair. This warranty might be of benefit to some if they are just starting out and don't want to be surprised with a huge bill when something goes.

we had one of these contracts with our first home through american home shield and it was great-very responsive and in one case with our older HVAC they went to the extent of having custom made parts fabricated to deal with an issue. the sellers paid for the first year and we just kept the policy going. with our current home we realized quickly that they had very few/far flung contracted trades and it was not of the value that it was worthwhile for us so I would recommend before anyone signs up for one to see what availability is like in their neck of the woods.

 

[LuvOrlando]

Sold our home recently but did this for 30 years.

There is the big stuff, like the roof, hot water heater, windows, furnace and HVAC, even floors like carpeting need to be addressed over time. If these things are aging out you might want to start a fund to replace. If they need it and you can, then try to do windows over time, same with doors inside and out. Look at your handrails, do they need work? Cabinets can get a really refreshed look with painting and a lot can be managed yourself with replacing door knobs and locks slowly over time. All

Overall don't be cheap with homeowners insurance. It is not worth the extra $35 a month savings if your roof collapses during a hurricane and insurance tells you that you get $2000 for a $25,000 job due to depreciation, get replacement cost value RCV not ACV where you only get the equity value remaining in your stuff. After hurricane Sandy I got a new roof for a $500 deductible and the neighbor got a $2k check, most of our neighbors got wrecked financially. Read your policy closely and know what the regional risks are, I knew someone who couldn't sell their home during a messy divorce because the insurance didn't cover sink holes and they couldn't afford to fix the one in their yard. yikes

Also, my utilities company offered insurance on my hot water heater, furnace and HVAC, plus washer and dryer. I think that I also found insurance for the water and sewer lines from my house to the street which, I discovered insurance doesn't cover as it only covers water that comes down not water that seeps up.. tricky and crafty.

Yes, these things nickel and dime you but the coverage I had meant not big surprises, I do not like financial shocks

 

[tvguy]

Sold our home recently but did this for 30 years.

There is the big stuff, like the roof, hot water heater, windows, furnace and HVAC, even floors like carpeting need to be addressed over time. If these things are aging out you might want to start a fund to replace. If they need it and you can, then try to do windows over time, same with doors inside and out. Look at your handrails, do they need work? Cabinets can get a really refreshed look with painting and a lot can be managed yourself with replacing door knobs and locks slowly over time. All

Overall don't be cheap with homeowners insurance. It is not worth the extra $35 a month savings if your roof collapses during a hurricane and insurance tells you that you get $2000 for a $25,000 job due to depreciation, get replacement cost value RCV not ACV where you only get the equity value remaining in your stuff. After hurricane Sandy I got a new roof for a $500 deductible and the neighbor got a $2k check, most of our neighbors got wrecked financially. Read your policy closely and know what the regional risks are, I knew someone who couldn't sell their home during a messy divorce because the insurance didn't cover sink holes and they couldn't afford to fix the one in their yard. yikes

Also, my utilities company offered insurance on my hot water heater, furnace and HVAC, plus washer and dryer. I think that I also found insurance for the water and sewer lines from my house to the street which, I discovered insurance doesn't cover as it only covers water that comes down not water that seeps up.. tricky and crafty.

Yes, these things nickel and dime you but the coverage I had meant not big surprises, I do not like financial shocks

Windows can be tricky. The price we paid for our dual pane Anlin windows was based on the sum total linear inches of window you are buying, not on the number of windows. Doing all of them at once lowered the total price quite a bit. Our 1979 single pane windows still functioned property, so in reality the new windows were only a cosmetic upgrade. If there is an improvement in noise transmission or energy savings, we have not noticed that. So I would not update windows expecting an improvement. But we knew that as we added onto our house 30 years ago and the windows are dual pane there, and put a dual pane bay window in the kitchen at that time. And we put dual pane windows in the bathrooms when we remodeled 13 years ago. We did not replace the window in the garage, saw no reason to.