As a new homeowner, you may discover that your budget is not very flexible. You may have used all your savings for the down payment on your first home, even though you are well aware that you will likely have a difficult time making ends meet in the years to come. Even if this isn't the case, you likely still want to avoid or reduce unnecessary financial risks while increasing your returns on investments and decreasing the amount of money you waste.
Every dwelling requires some sort of regular maintenance over time. Although the exact amount will vary depending on a number of factors, it's a safe bet to set aside one percent of your home's value every year to cover annual maintenance costs (including the age of your home). If you bought a home for $260,000, for instance, you should budget about $2,600 annually to cover maintenance and repairs.
In the long run, housing costs are substantial regardless of whether you buy a house or rent an apartment. However, if you need extensive fixes, expect the price to skyrocket. A plumber's or electrician's bill can easily put you in the emergency room.
However, as Ben Franklin once said, "an ounce of prevention is worth a pound of cure." Investing time and energy into maintenance helps you stay one step ahead of any problems that might arise. This means, at the very least, that you can start saving up for the inevitable repairs and upkeep that will be necessary.
Fortunately, there are a variety of methods you can employ to reduce your maintenance costs.
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Home Repair FAQs
However, the difference between repair and maintenance work is that repairs aim to restore functionality while maintenance looks to preserve functionality. Put simply, repairs are done after downtime to minimize losses, while maintenance is done to prevent unexpected asset downtime.
Fixing up a house can be profitable, but investing a few hundred dollars in repairs and upgrades may not add thousands of dollars of value to your home. In fact, the average return on your remodeling investment is 20 percent or 30 percent less than you spend.
How much money should you have left after paying bills? This theory will vary from person to person, but a good rule of thumb is to follow the 50/20/30 formula; 50% of your money to expenses, 30% into debt payoff, and 20% into savings.
Walk around the house and check windows and doors for drafts. Caulk door and window frames where necessary. In late fall, install storm windows and the glass panel on storm doors to keep the heat in and the cold out.
Someone who's good at many things, especially fixing things around the house, can be called a handyman.
Why Knowing Your Maintenance Costs is so Important
The annual costs of owning and maintaining a home can have a significant effect on your monthly expense budget and overall housing costs. In spite of your distaste for math and budgeting, there are times when you simply must deal with the cold, hard facts.
- Within your price range, you can select a better home.
- Starting your house search here will save you time and effort.
- Moving from one larger home to another requires careful planning of your relocation dates.
- Taking the time to do a thorough analysis of investment opportunities and returns.
- Being aware of the measures necessary to preserve your home's value is crucial.
- Choosing a home that brings you joy and contentment to live in instead of stress and anxiety is a wise investment.
- Choosing a house that fits comfortably within your long-term budget constraints is essential.
Be a Savvy Home Buyer
Advertisements and comparisons of vehicles have recently increased in frequency, with an emphasis on the total operating costs of various models. You may have noticed an increase in the prevalence of these stickers in the windows of vehicles the next time you went car shopping. More and more often, this is a priority for forward-thinking, eco-conscious homebuilders. Still, the vast majority of homebuyers have no idea what their final costs will be.
They don't mention it even when making an offer or committing to a purchase agreement. Not everyone gets the keys to their new home on the day they sign the mortgage papers, make their down payment, and complete the closing. That's like buying a phone for a world trip without first finding out how much you'll have to pay in roaming and data fees. If your plan is truly unlimited, it may still have a monthly cap of $150. Another option is to come home to find a ten-thousand-dollar bill concealed in your mailbox. If money is tight, what other options do you have?
Home Maintenance Tips to Reduce Costs in the Long-Run
Get to know the lay of the land.
The condition of your backyard and the areas immediately surrounding your home can have a major impact on the frequency and extent of necessary maintenance. For instance, if your home is surrounded by numerous trees, you can expect to spend more time than usual maintaining the roof and possibly even some of the plumbing. Even if you have an apartment, knowing the area around it can help you assess the likelihood of flooding and other natural disasters. This knowledge is crucial no matter where you call home.
Do once-overs in the offseason.
Most people find out their furnaces are broken on the first truly cold night of the season. You should not be attempting to schedule an appointment with a heating and air conditioning technician right now. If you use your heater and air conditioner once a month, or more often if you live in a particularly hot or cold climate, you can ensure that they are in good working order and save money on emergency service calls.
Get an energy audit.
One way to reduce monthly electric costs is to identify and seal off energy leaks around the house (and you can take at least some of these steps in a rental). Taking this kind of action can also help you make some long-term decisions, like what kind of water heater to buy when the one you currently have needs to be replaced.
Cut back on the grass.
A lush, green lawn may be expected in some communities, but it can be a major time and financial commitment to keep it looking good. There are many ways to lessen the amount of grass in your yard, such as through the practise of xeriscaping or by emphasising local flora. You will save money on water and time spent mowing the lawn (you may even be able to get rid of the mower altogether).
Share tools with your neighbours
The cost of home maintenance is largely attributable to the necessity of purchasing specialised equipment for each job. Having a chat with your neighbours can make a positive difference. If you have the means to pool your resources, you won't need to buy any new equipment. That can be anything from a small item like a pen to a large item like a lawnmower. There may be only one person in the neighbourhood who can use the lawnmower at a time, but the expense of buying and maintaining the mower is minimal.
Clean everything on a regular basis
Whether you're sweeping the sidewalk or cleaning the air conditioner, maintaining a clean environment will help extend the lifespan of your possessions. The life expectancy of any device with a filter or vent will be decreased by dust. Inspecting your appliances and other home parts on a regular basis can help you catch minor issues before they become major disasters. After all, if you never touch a wall, you'll never know there's a hole in it.
Look for a handyman.
Some tasks are better left to a professional who can complete them in half the time it would take you to even find the resource that walks you through how to do them (assuming you could even find such a resource) than they are worth in terms of your time (when compared to the cost of hiring a handyman). This is due to the fact that the handyman can finish the job in a fraction of the allotted time. Establishing steady communication with a handyman is a great idea. He can point you in the direction of the right resources for more complex endeavours, and he may even be willing to show you the ropes on smaller, more routine jobs so that you can do them on your own in the future.
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Create a maintenance schedule
One of the surest ways to never get around to cleaning the gutters is to tell oneself that one will do so at some point in the future. The easiest way to keep up with the upkeep of your home is to create a schedule for yourself, and as long as you know what needs doing, sticking to that schedule will help you accomplish less. On the other hand, you could devote an entire weekend to cleaning once a month. A long-term strategy for home improvements and appliance replacements is also recommended.
Read the manual
There is a user manual for the water heater, as well as for everything else in your home. There is useful advice on the recommended maintenance in each of these guides. You can save money by fixing simple problems on your own without paying for an expensive service call if the manual provides instructions for doing so. In many cases, you can find digital versions of manuals if you can't find your physical copies.
Create a home maintenance fund
Preparing for the cost of maintenance is prudent, even though it is typically less than that of repairs. You can set yourself up to hire a professional to handle any home upkeep tasks that you either don't enjoy or aren't good at. Anything that requires the use of a ladder falls into that category for me. You can better put yourself in a position to do this if you maintain a reasonable budget for your costs. Even if you're careful, some repairs are inevitable; being prepared for them financially will keep them from becoming a major burden.
Why Home Maintenance Is Important
The responsibilities of home ownership are much higher than those of renting. There is no landlord to call in the event of a problem; instead, the burden of fixing it falls squarely on the shoulders of the owner. What this means is that housekeeping and maintenance duties fall squarely on the shoulders of the homeowners. Everyone from your real estate agent to your mortgage lender to the countless websites you've perused has harped on the importance of keeping up with home maintenance and given you countless resources for doing so.
The question is, why is it so important? Landmark's primary goal as a home warranty provider is to help homeowners in the event that their home's systems or appliances fail due to age-related issues or general wear and tear. On the other hand, if a system or appliance has stopped working due to a lack of maintenance, "normal wear and tear" will not be considered to be the cause of the problem, as stated in our contract. Although having a home warranty is a great incentive to keep up with necessary repairs, that is not the only reason to do so. The value of keeping up with necessary repairs in your home is bolstered by a number of other factors.
Home Maintenance Saves you money.
The fact that it helps you save money as a homeowner is the first and most compelling argument for the significance of home maintenance. The likelihood of that being true has probably passed you by. "I spend a considerable amount of time, money, and effort keeping my house clean and in good condition. When will I start seeing savings from this? "
While it's true that maintenance is expensive, time-consuming, and labor-intensive, you ultimately save more money by performing maintenance than you would have by not doing it. To what end is this happening? According to "Your Money: The Missing Manual," homeowners can save about a hundred dollars by investing a single dollar in preventative maintenance. The reason for this is that minor problems, such as a dirty filter or a clogged drain, can be avoided in the long run by attending to them as soon as they are noticed (a burned-out HVAC motor or burst pipe.) Buying a new furnace filter every month is nothing compared to the cost of repairing major damage to your home if you neglect routine maintenance.
Home Maintenance Keeps Your Home Running Efficiently
The fact that it's just upkeep is the most irritating part of maintenance. Home maintenance entails doing a particular activity over and over again so that the various parts of your house continue to work properly. It's the equivalent of keeping a clean kitchen by sweeping the floor multiple times a week. If you hadn't mopped the floor, just think of the mess that would have ensued. Now think about how often you sweep the floor versus how often you clean the filter in your dishwasher or unclog the drain in your bathroom. However, you probably use them almost as often as you do the floor.
A clean and usable floor requires regular sweeping, just as a clean and usable bathroom requires regular cleaning and maintenance. Failure to do so will reduce the effectiveness of your household systems. If you don't change the filter in your furnace regularly, it will have to work harder to cool or heat your home, which will increase your utility costs. If you don't keep your refrigerator's evaporative coils clean, it will work harder to keep your food cold and use more energy. Homeowners who keep their properties in tip-top shape enjoy reduced utility costs and more comfortable living conditions.
Home Maintenance Increases your Home's Value
The moment you drive off the lot in a brand-new car, its value starts to drop. Keep in mind that the value of your car decreases as time passes and age sets in. However, the same principle does not apply when applied to a home. Building equity in a home takes time, but the longer you own it, the better. Although the market, and not just the improvements you make, ultimately determines your home's value, you can have a direct impact on that value by maintaining your home well.
In other words, how does this work? If you decided to sell your home tomorrow without having performed any maintenance on its systems or appliances, the home inspection report would likely show that there were many problems with the home as well as many potential problems. Prospective buyers may negotiate a lower purchase price from you or ask you to replace or repair items they see as potential maintenance headaches. Regardless of the circumstances, you will not be able to recoup the full market value of the home from the sale of the property.
However, if you had properly maintained your systems and appliances per the manufacturer's guidelines, the home inspector would have found fewer issues that you would need to address during the inspection, and you would have likely gotten more money out of the home. Click here for details on the types of home improvements that yield the greatest returns in terms of increased property value.
The amount of equity you have in your home is proportional to the number of home maintenance and improvement projects that you have paid for out of pocket that have increased the value of your property.
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Home Warranties and Home Maintenance
Problems that arise from lack of upkeep are typically not covered by home warranties or homeowner's insurance. There is a good chance that no homeowner's insurance provider will pay to fix your roof or attic if it turns out that you neglected to clean out your gutters before the flood. Similarly, a home warranty would not typically pay to repair or replace your HVAC system if you neglected to change the filters for an entire year and the fan eventually burned out from overuse. If you have a home warranty, why should you bother with preventative maintenance on your home's systems and appliances? Maintaining your systems and appliances on a regular basis is crucial to maximising their service lives and minimising the likelihood of any unexpected breakdowns. The vast majority of home warranty providers will refuse to fix or replace a homeowner's systems or appliances if the homeowner hasn't made an effort to keep them in good working order.
Investing in a home warranty will save you tens of thousands of dollars. This is because the warranty will remain in effect even if you clean and maintain your home's systems and appliances as best you can as they age and start to show signs of wear and tear. For the cost of a single service call, your home warranty will fix or replace any broken appliances or fixtures.
If you haven't bought a house yet but are putting together a spending plan, one consideration is how much you can save on home maintenance over time. Consider purchasing a home that was built relatively recently; by the time you move in, it will have seen less wear and tear from normal use. In addition, you can conduct a more thorough home inspection by scrutinising every nook and cranny for signs of trouble. This would aid you in avoiding transactions that may turn out to be more costly than they are beneficial.
In addition to the mortgage payment, there are a plethora of other outlays that must be made in order to maintain a home. Size and price of the property, as well as the type of property being purchased, can have a direct impact on these expenses. The good news is that there are ways to deal with these figures more efficiently from the get-go and to prevent their growth in the future. A professional real estate agent can help you determine how much it will cost to buy and maintain the homes you're interested in. They can help you find the property that is the best financial and emotional fit for you.