Cost of house maintenance

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Cost of house maintenance

Postby Dumbo » Fri Jul 12, 2013 3:02 pm

Hi,

I was wondering what you typically spend on house maintenance? We are in the process of looking for our first home in relatively near future. We live in Boston, MA and will probably be looking at a house in the greater Boston areas (think: Newton, Belmont, Lexington, Arlington) and looking at homes around 500-700k.

Some seem in good shape and I've budgeted anywhere between $500 to $1000 a month. The logic behind it is that I may not spend $1000 every month but if I spend zero then getting a kitchen renovation in 2 years can come out of that budget. So basically 500-1000 would cover basic day to day things and leftovers for major work.

Maybe I should keep two separate budgets for each? In that case what should be the approximate range for basic day to day things NOT INCLUDING any major work such as remodeling, expansions, roof replacement, water heaters etc. Just the core. For whatever reason I think it's easier to budget for a 15k roof replacement than a miscellaneous list of $200 or whatnot per month. At least with a roof I know it stands a good chance of not needing replacement for 20 years if I buy a new one.
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Re: Cost of house maintenance

Postby surfer1 » Fri Jul 12, 2013 3:18 pm

In the price range of 500-700k, I would think you're getting a house within 0 - 20 years old? If so, maintenance should be on the lower end. Maybe < $100/month, if even that. Think small repairs and lawn service. If the house is 10 years old, check the water heater date, roof age, heater/ac age, and any motor device ages (sump pump, septic, etc). You really get into higher maintenance when the house is about 50 years old. At that point, expect $200+/month in small to moderate repairs (toilet flanges, electrical outlets, cracks, wood, pests, etc). It's helpful if you're handy - a trip to home depot can cut down on costs vs a call to the repair man. Either way, $500-$1000/month is much too high for maintenance, that's practically rent!
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Re: Cost of house maintenance

Postby Dale_G » Fri Jul 12, 2013 8:56 pm

The numbers usually bandied about for routine maintenance are 1%-2% of the value of the house, with more "mature" houses at the upper end. But given the wide variation of prices for the same home in different markets, I don't have a lot of faith in the % of value metric.

I've owned small modest homes and large fancy homes. I think routine maintenance ran $200-$300 per month, but this does not account for unexpected events like a flooded cellar or a new roof.

Renovations of any kind are an entirely different matter. You need to budget for renovations separately.

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Re: Cost of house maintenance

Postby Dumbo » Fri Jul 12, 2013 10:33 pm

Yeah so I originally thought it would be 200-500 but I was not sure and my bias is to always go for the pessimistic or expensive extreme. I figured if I budget for $1000 then I won't get blindsided by some other expenses. And I figured well if I have 800 left over then that can go in a little jar for a new kitchen or bathroom.

I'm not a fan of the percentage rule of 1-5% as it's too general and does not seem to take individual variables into considerations.

My problem was that with stretching the "maintenance" budget to 1k I was significantly eating into my rainy days fund so it made me quite uneasy. This puts my mind at rest a bit. I think I'll still anticipate around $400 for safe measure. If I'm wrong I'll just be pleasantly surprised.

I imagine most of the expenses will come in first few months as we begin to transition into the house and figure out what works, what doesn't and replacing little things here and there.
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Re: Cost of house maintenance

Postby Mudpuppy » Sat Jul 13, 2013 2:08 am

Here's my personal approach. I split my budgeting into "wants" and "needs" category, even for the house. So a kitchen remodel, expansions, upgraded window coverings, new furniture, etc. would be "wants" and would have their own separate savings. But replacing a worn out roof, fence or appliance or doing routine repairs would be "needs" and would be part of the routine annual budget.

To some extent, you can determine the big ticket repairs in the routine repair budget and adjust accordingly due to expected wear and tear, but houses have a tendency to throw the unexpected at you, so amortized costs might be a better approach just to be sure you have enough on hand should life happen. My average for routine repairs in the current house has been 2%, which is right in the expected range for an older home (more expected repairs and replacements).
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Re: Cost of house maintenance

Postby madbrain » Sat Jul 13, 2013 3:58 am

I would certainly distinguish things that are required repairs from home improvement projects.

Things like a new water heater and a new roof would fall under the first category. It's hard to live without hot water, or a leaky roof.

A lot of that maintenance tends to be fairly random, and is really hard to budget for because it can still be a big chunk. I don't budget for it. In years when it happens, my budget may not be balanced, ie. I will withdraw from ER to pay for it.

A kitchen remodel or expansion is always optional and would fall under the category of home improvement projects, so that can be budgeted.

Of course, sometimes they will overlap a little bit. For example if your dishwasher fails first, you could decide not to repair it and wash your dishes by hand for a while. Maybe you wait for your oven or fridge or faucets to also fail, and then you take care of it all at once in a major kitchen remodel.
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Re: Cost of house maintenance

Postby Aptenodytes » Sat Jul 13, 2013 5:24 am

I agree with the others that remodeling and expanding are in a separate category from maintenance, and that percentage of home value is not a relevant benchmark. A brand new luxury home will require less maintenance than a hundred-year-old hovel.

My approach may not be the most kosher, but it has worked for me. I have not budgeted for these things at all.

For something like a hot water heater replacement, I just pay for it out of regular cash flow. In practice it means our checking account balance is coming closer to zero than normal, or we economize on discretionary purchases for a couple months, but the point is these things are small enough to get absorbed in the course of day to day living. Most maintenance activities fall into this category for me.

A big irregular expense, such as replacing a roof or resurfacing the driveway, for me would be treated as a reason for dipping into the emergency fund. Your approach amounts to setting aside a separate emergency fund for the house, which seems inefficient. It is probably better to have a single omnibus emergency fund that you tap into for whatever emergency arises.

If you want a separate fund for the kinds of things I pay for out of regular cash flow, I would simply put aside something like $3,000 into a dedicated fund and use it when you need to service the AC or get a new washer or whatever. Keep the balance where you want it rather than keep plowing in the same amount of money every month.
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Re: Cost of house maintenance

Postby beachplum » Tue Jul 16, 2013 3:10 pm

surfer1 wrote:In the price range of 500-700k, I would think you're getting a house within 0 - 20 years old? If so, maintenance should be on the lower end. Maybe < $100/month, if even that. Think small repairs and lawn service. If the house is 10 years old, check the water heater date, roof age, heater/ac age, and any motor device ages (sump pump, septic, etc). You really get into higher maintenance when the house is about 50 years old. At that point, expect $200+/month in small to moderate repairs (toilet flanges, electrical outlets, cracks, wood, pests, etc). It's helpful if you're handy - a trip to home depot can cut down on costs vs a call to the repair man. Either way, $500-$1000/month is much too high for maintenance, that's practically rent!


Houses in the towns the op is considering are pricey. A house in the 500-700K range will get you an older home. Here are a couple of listings in Lexington: built 1911 - 548,000, 1888 - 794,000, 1988 - 1,295,000. It's pathetic, but the better the schools, the closer to Boston the more outrageous the house prices. Unless these older homes are updated, the more you will need for maintenance especially if you contract out work.
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Re: Cost of house maintenance

Postby Rupert » Tue Jul 16, 2013 3:31 pm

Aptenodytes wrote:I agree with the others that remodeling and expanding are in a separate category from maintenance, and that percentage of home value is not a relevant benchmark. A brand new luxury home will require less maintenance than a hundred-year-old hovel.

My approach may not be the most kosher, but it has worked for me. I have not budgeted for these things at all.

For something like a hot water heater replacement, I just pay for it out of regular cash flow. In practice it means our checking account balance is coming closer to zero than normal, or we economize on discretionary purchases for a couple months, but the point is these things are small enough to get absorbed in the course of day to day living. Most maintenance activities fall into this category for me.

A big irregular expense, such as replacing a roof or resurfacing the driveway, for me would be treated as a reason for dipping into the emergency fund. Your approach amounts to setting aside a separate emergency fund for the house, which seems inefficient. It is probably better to have a single omnibus emergency fund that you tap into for whatever emergency arises.

If you want a separate fund for the kinds of things I pay for out of regular cash flow, I would simply put aside something like $3,000 into a dedicated fund and use it when you need to service the AC or get a new washer or whatever. Keep the balance where you want it rather than keep plowing in the same amount of money every month.


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Re: Cost of house maintenance

Postby Steady59 » Tue Jul 16, 2013 3:41 pm

I don't count the cosmetic changes you may want to make when you move in or any remodeling in the future. Though I try, my wife does not agree that these types of expenses should come out of our emergency fund. Instead, we budget for some home repair each year. If we do not use it, it goes to increasing emergency fund. Figure out that logic!

Anyhoo, try to get the maintenance history or have the home inspector tell you about the following when you are looking at prospective homes:

    Roof
    Furnace
    Hot water heater
    A/C (if any)
    Driveway repaving
    Deck
    Exterior paint (if not sided)
    Front steps/walk ways
    Pool ? (liner, pump, filter, etc)
    Appliances
    Garage doors
    Chimney/stone work repointing
    Exterior fence
A good inspector should be able to give you budget #s ranges and time frames for each so that you can plan accordingly. You should also use this info to haggle with the sellers.

The Boston area can be pretty pricey. The trick with any of these repairs is to get quality work done. For example, we had our roof done by a cheapo outfit and they butchered it. Three years later, I had it done properly by a reputable guy. Do your homework on who will do the work for you and keep the receipts!
Last edited by Steady59 on Tue Jul 16, 2013 4:21 pm, edited 1 time in total.
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Re: Cost of house maintenance

Postby Rodc » Tue Jul 16, 2013 3:54 pm

I'm in a house in that range in one of the towns you mentioned.

First, hiring someone here is a lot more than in many other areas. So, someone from a midwest state is not likely to have accurate information on costs, for example.

A lot will depend on the particular house. Is it a small house in great repair or is it a larger house not in great repair (both might cost the same to buy).

A lot will depend on how handy you are. Can you do most repairs or will you have to hire someone for everything (or something in between)?

How picky are you? Do you need everything to look like it is ready for a Better Homes and Garden photoshoot or is a little rough around the edges ok?

What you count as maintenance? A bathroom redo might be maintenance or might be remodeling. Sometime something needs fixing and you decide while you are at it to remodel. How to do the accounting?

We did some major renovation (turned a small ranch into a large cape) back in 1996, put on a kitchen addition in 1999 and did a major kitchen remodel (though I did the kitchen remodel including milling the raised panel cherry doors in my shop, so that was very cheap), 2003 was a new patio and sidewalks, 2005 was a complete bath remodel to finish off the redo of the entire house, 2012 was new porches all around, one of which was really maintenance. The up shot is we spent a great deal of money turning a tiny, cheap (second cheapest house in town the year it was bought, cheapest was riddled with termites) into a nice home, if modest by the standards of the new $1M+ homes going up in town. We finally have a nice if modest home, and the total cost was less than if we bought it in this condition, if only because I did a lot of the work.

If you buy a house like this you will likely want a large repair/remodel budget. Otherwise not so much. I guess we have been through every appliance in the house, so that is maintenance, but was handled by cash flow.

So far we actually spend little on "maintenance" since most is "remodel". However, the roof is now 17 years old (looks great), heating is 17 years old, upstairs bath is 17 years old... They seem to be doing great, but at some point maintenance will be needed.

What we have done is along the lines suggested by Aptenodyte for what maintenance we have done or expect to do. The two major remodeling efforts (second story and kitchen addition) were done by loans and folded into ever lower rate mortgages. Fortunately our liquid funds (emergency funds) are more than large enough for any foreseeable maintenance. Back in 1993 when I bought the house I had a lot less money and had to save monthly. I did not keep separate funds (house, car, emergency). Of course I still save monthly. Habits you know...
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Re: Cost of house maintenance

Postby Meg77 » Tue Jul 16, 2013 4:16 pm

A LOT of this depends on how much you are willing/able to do yourself, especially on older homes. My dad is handy and happily (or at least dutifully) spent hours each week maintaining his and my mom's 22 year old sprawling airy rural home. There is always a bathtub that needs re-caulking or a rotting window sill to replace or weeds to pull or a leaky faucet to fix. However when he and my mom split and my dad moved out suddenly my mom was spending hundreds of dollars a month just on maid service and lawn care - which my dad would have never dreamed of paying for. God only knows how much she'll shell out for actual maintenance or if she'll just let the house rot around her slowly...
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Re: Cost of house maintenance

Postby Jay69 » Wed Jul 17, 2013 1:09 pm

I think a good place to start is to save about 1% of the home value/year and max the amount saved at the price of a new roof or some other major item you don't care to do yourself.

We don't keep to much around for house repairs (maybe enough for a new garage door on a good day) for 2 reasons: a) I prefer to do most things myself and it just comes out of the everyday funds. b) We keep a good 1 year EM fund that has a good chance of covering those large unexpected repairs, like the new septic system we put in last year.

I know I'm going to need a roof in the next few years, I may save a few extra thousand to cover it, again I will most likely do it myself so it's really not that big of a deal either. If we take a few thousands out of the EM fund and get that back to par in a few months I'm fine with that as well. I guess living in a small house has one advantage of not having to worry about to big of repairs.
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Re: Cost of house maintenance

Postby semperlux » Thu Jul 18, 2013 12:48 am

Let's put it in perspective. My home is less than 10 years old. For the past year, here's what I've done :

-recaulk shower $9 for 2 tubes
-replaced shower cartridge $18
-replace toilet flush valve $9
-replace toilet drain value $4
-fixed cracked /leaking sprinkler pipe joint $20
-replaced 3 CFL light bulbs $3
-replaced O rings on kitchen faucet $5
-installed door stops to all doors $10
-replaced 3 cracked roof tiles $8
-replaced capacitor and motor for AC unit $286
-greasing garage door track $3

Total $375

However I did all of these by myself. YouTube is my best friend =) and I borrowed tools from family. If you hired someone else, the labor costs would likely skyrocket your costs.

This year's planned projects include repainting the house $2000, installing water softener $600-700, so costs will likely vary from year to year. I didn't include regular maintenance costs like quarterly insecticide preventive spraying & weekly lawn care. You may want to consider that too.

Cheers and good luck house hunting!

PS: avoid a pool like the plague; I had the displeasure of maintaining a relative's pool and it was a ton of work and super expensive.
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