Repairs to Our Home: Have We Spent the “1-3%” in Maintenance over the Last Two Years? – Frugal Confessions

Repairs to Our Home: Have We Spent the “1-3%” in Maintenance over the Last Two Years?

We are in love with our home. I know, I know—you’re not supposed to get emotional about a house for any number of reasons. But we just can’t help it. It was built in 1975, and has some character to it that we could not find with newer homes on the market. Our backyard is teeming with plant life, from the blossoming lemon tree we planted as newlyweds almost two years ago to the beautiful hummingbird vine that was here from the previous homeowners. We grill, we weed, we host friends and family; life is pretty good.

But homeownership is not all lemonade and hummingbirds; it comes with financial responsibilities. A figure you will hear thrown around is that you should expect to spend around 1%-3% of the home’s value each year on maintenance. This is above and beyond the down payment, mortgage, insurance, and property tax. It seems fitting to discuss our own experience with this while a plumber is downstairs cutting a hole through our living room ceiling. I just took a peek, and was slightly horrified when he peeled back the soggy plaster where dry, coarse material should have been and a gush of water hit our floor. The grim news is that it will cost an estimated $700 to fix (that is unless we want to leave a 5 gallon bucket where our coffee table should go). The good news is that we listened to the experts and have purposefully built up an emergency fund/house fund to deal with issues such as this.

To give you an idea of our own experience with home maintenance and repair costs, here’s a breakdown for our last two years of homeownership:

  • Year One:  Landscaping after hard freeze kills all of our front bushes and other vegetation ($150), A/C unit replacement (approximately $3,500 out of pocket after tax credit and home warranty), chimney cap installation ($450), replaced garbage disposal ($100), soaker hoses ($30) (Total: $4230, 2.5%)
  • Year Two: Foundation repair ($3,500), plumbing repair ($835 in total), washer replacement ($385), broken dishwasher (not repaired/replaced yet) (Total: $4720, 2.8%)

I am not writing this to scare you away from homeownership, or even necessarily to complain about our plumbing bill. Rather I am taking the opportunity to show you how an emergency fund and house fund for maintenance/repairs is a must have when you figure out your expenses and determine whether or not you are ready to own a home. Having one of these is not a nice suggestion from current homeowners that is meant to deter you from owning your own home. Rather it’s solid advice.

As a homeowner, have you found the 1-3% maintenance and repair costs to be accurate? Do you have a house fund/emergency fund? 

P.S.: FMF does a great job of outlining the best cash reward credit cards available at this time. If you are financially disciplined, and pay off your balance each month, then you could use a card for home repairs and maintenance in order to get a small discount!

16 comments… add one

  • ShortRoadTo

    To not have to worry about apartment neighbors throwing yet another party until 4 A.M. is priceless. I am a big advocate for home ownership. It gives me peace of mind.
    ShortRoadTo recently posted..Need a Predictable Income Stream? Use a Bond Ladder

  • We had a similar hole appear a few weeks before selling our previous home. Our leak came from the roof though. Not fun.

    It is horrifying to think that an AC unit going out would ding you for a few thousand.
    John @ Married (with Debt) recently posted..Debt Payoff Progress March 2012

    • FruGal

      I know–Central AC is expensive. We had to have a 3.5 ton unit.

  • Try having your sump pump breakdown in the middle of a storm and finding your basement filling with water! Stuff happens – its part of owning a house. You are smart to keep that extra cushion of cash for such emergencies!

    • FruGal

      Oh my goodness you poor thing! We don’t have basements here in Houston, but I am from PA where we do and remember vivdly how they can fill up.

      I hope there was no damage…

  • I’m not going to lie, that did scare me out of home ownership a bit! haha. Just kidding. I’m lucky because the boy is a carpenter and my dad sells building supplies – most of the repairs we’ll have to do on our future home will be covered.
    Daisy recently posted..March Goals: How I Did

  • So…are you within the 1-3%? From what I know about Houston, and thankfully I don’t live there any more, it seems you most likely are so far.

    Yes, crap happens when you own a home. I always wonder how all these people with rentals do it. One house is way too much work for me!

    Have you figured out that plumbers will cut holes but won’t fix them yet?
    Bichon Frise recently posted..misconception about roth IRA first time home buyer distribution

    • Hello!

      Yes–we are within the 1-3%. I should have summarized better:).

      And yes…with the price he quoted I asked if he would fix our ceiling. He said “You don’t want me to.” Cheeky! You would think for all of that money they would have fixed the ceiling.

  • This is such an important point! There’s a lot to be said for homeownership, but all potential buyers (especially first-time home buyers) must first understand the added expense of such things as maintenance and emergency repairs. As you’ve stated, this is one good reason why having an emergency fund is so important.
    Anthony Thompson recently posted..Self Management – Classic Self-Management Books You Should Start Reading Today

  • I cannot wait to save up an emergency fund. My wife just started working in feb and we are slowly catching up and paying down some of our bills….It feels like there is so much more breathing room now with 2 incomes!! I actualy feel like a millionaire…since we got married she has never really worked…we moved to near her house and then out came 2 kiddies…and she just got back into it..

    I have a whole in my roof now with a bucket under it in the attic that I cannot wait to get fixed!!
    Christopher @ This That and The MBA recently posted..Five For Friday: I went golfing and my body is sore edition!

  • Thanks for this post. So many people don’t budget for regular repairs. While our rent is at least as much as we would pay for a mortgage payment, we know after adding in repairs and taxes, a house would be beyond our reach right now.
    Melissa@PersonalFinanceJourney recently posted..Save Hundreds of Dollars a Year by Making These Four Drinks at Home

  • Air conditioning las vegas

    This is absolutely right. There are lots of appliances which may be affecting anyone. But AC protects us from unbearable heat of the sun. That’s why it has played an important role in human life. But it totally depends on you how you manage your bills with in your budget.

  • I honestly can’t think of really anything “big” that we’ve spent in the past 2.5 years since we bought our house. Of course we’ve bought air filters, etc, but our families are pretty handy (we have HVAC, plumbing, electrical, and so on in his side of the family), so we haven’t spent a dime on maintenance. Thankfully!
    Michelle recently posted..Spending, Life, Income and Food Updates… 4/9/2012

  • No Profile Comment

    Dear Frugalconfessions,
    Maybe a little off topic, however, I am generally frugal with groceries, like making something new out of leftovers, and trying to buy foods that can be used as more than one meal. But, I feel like I am missing some other ideas and tips to save money on groceries and other bills. Does anybody have any other ideas? Thanks for your input!
    I’ll be back to read more next time

  • I budget for my full mortgage payment every 4 weeks – meaning that every year I have a 1/12th to stash away in my “home repair” fund.

    The best way to save money is to repair everything as soon as it goes wrong or starts to niggle – and learn how to do the basics yourself as much as possible.

    Sometimes it sucks painting frames when the sun is shining – but one day and they are done…. or I could work a week and pay someone else I suppose.
    Elaine Colliar recently posted..Don’t do as I do ……

    • FruGal

      Hello Elaine!

      Good idea on the budgeting–home repairs tend to creep up when you least expect them.

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