Home Maintenance Costs: Year 1

home maintenance costsAs I wrote in my previous post our move in date to our newly renovated home was October, 27, 2012. This means that we have now lived a full year in our home.  I had always heard from other homeowners that you should keep a home maintenance budget equal to 1% of the purchase price of the home. Based on this belief we should have $2,090 in our budget to cover home maintenance costs for the year.  This post will outline how much we actually spent this year.

Home Maintenance Issues

The first item to die was the water heater.   Of course, the timing was terrible.  My husband noticed the tank leaking on a Sunday evening. It was actually mother’s day of this year.  We panicked as we didn’t know what to do or what was going to happen next.  We called our contractor and thankfully he rushed right over to help us out.  He explained that the water heater had come to the end of the road and needed to be replaced.  That same evening I went online to Home Depot to find a new water heater.  I purchased it and picked it up the next day.   The cost was $500 for the tank, $300 for parts and installation.

Approximately two weeks later the weather started turning warmer so we decided to turn on the central air. The unit was working fine for about two days then it just stopped working.  Of course, the timing was bad again as my husband had gone out of town to visit his sister for Memorial Day weekend.  This was another one of the items that our home inspector had warned us about.  We had also called an HVAC professional when we first bought the house and he confirmed that it was about 20 years old and we should just use it until it dies.  So, here I was with no air conditioner right before the start of the summer season. Thankfully for me, Memorial Day weekend turned colder on Friday and I didn’t need to use the air conditioner any more the rest of the weekend. When my husband got back from his trip we decided that we would buy two window ac units instead of replacing the central air unit. We spent $575 to purchase the two ac units and they cooled down our house just fine.

I think this was actually a great choice because our electric bill was quite reasonable this summer.  Both my sisters had just installed central air in their homes and they complained about their electric bills all summer.

Additionally, we have have a pretty big yard and since we are novice homeowners we decided to hire a landscaper our first year.   He charges us $100 per month from March to November plus $75 to trim the bushes twice per season. In addition we had some bushes that we wanted removed so there was an additional cost of $300 to take care of that.  Our total cost for landscaping will be $1350 for this year.

Total Spent on Home Maintenance Costs

Our costs to replace the water heater and air conditioners was $1,375 and lawn maintenance was $1,350 for a grand total of $2,725.

Our home was a fixer-upper so during the home inspection we were informed that these items were on their last legs and would eventually need replacement. We negotiated with the seller to cover these repairs and they agreed to give us $3,000 at closing.

Based on my experience the 1% rule to cover home maintenance costs is a good starting point.  In our case 1% equaled $2,090. We spent $2,725.   I would suggest to always add a little extra to that budget based on the condition of your home at the time of purchase.  Also, negotiate with the seller to have them cover some or all of the initial costs.

Do you have any other tips on home maintenance costs and how much to budget for the year?

Photo by: Flickr

Comments

Home Maintenance Costs: Year 1 — 16 Comments

    • That is one of the things I miss about being a renter. Having a building manager to call is definitely a good perk to have.

    • Hi Jen, Thanks for stopping by. Yes, I’m glad we had the emergency fund to cover these expenses.

    • That is what I’ve read about home maintenance…there are good years and bad years. I’m hoping for a good year in 2014!

  1. I’ve been in my home for almost exactly a year now, and as a new homeowner it has definitely been interesting. There are some major renovations I want to do but I basically have talked myself into holding off on them for as long as humanely possible. We have a rental studio that has cost us quite a bit to get ready but I plan on writing off all the expenses we’ve incurred from it on our taxes next year.

    My only tip is to keep some money aside and deal with things as they come. At least that’s the approach I’m taking.
    DC @ Young Adult Money recently posted…So Your College Degree Doesn’t Match What You Want To Do Anymore…My Profile

    • Hi DC, Thanks for stopping by. I intend to do the same. I’m keeping the 1% of the home purchase price on hand to cover any other maintenance costs for next year. I’m hoping for a good year.

  2. We put $40 a month into an account for home maintenance costs. We’ve actually had to break into it once as well, to repair our fridge! It was really nice to have the cash on hand and not worry about it. 🙂
    CF recently posted…Living the Canadian DreamMy Profile

    • Hi CF, I think I feel better just having that little cushion set aside. Especially since my emergency fund is low right now due to debt repayment. Thanks for stopping by.

  3. The 1% rule is certainly a good rule of thumb to operate by when you are a homeowner! Luckily for me, am still a renter…my maintenance fund is having the landlord on speed-dial incase anything breaks down 🙂
    But if in a year I could spend roughly that amount on maintenance and probably a couple of other things…seems like I should be considering a starter home or something…seems like a fairer amount than the annual rent, well, despite the hassles 🙂
    Simon @ Modest Money recently posted…TradeKing Review – Exclusive Review of TradeKing BrokerageMy Profile

    • The hassles is the worst part of dealing with home maintenance issues. I do miss the days of just calling my building manager to fix things. That was my favorite part of renting but I don’t miss the small spaces, lack of storage and sharing laundry facilities. If you can find a home that works for you it can be worth your while to buy.

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