Can I afford the maintenance?
The third concern of new home buyers in our original survey was “Can I afford the maintenance?” If you missed the prior two posts you can read about Buying in the Right Area and What Happens if Something happens to me financially?
So congratulations! You now own your own home and have the freedom to not worry about what the landlord will say if you paint that wall purple (or Red and Blue). Along with this freedom comes the new “privilege” of home ownership – as my wife like to call it. One of the most scary or stressful things about buying your first home is, even after the inspection, what if something MAJOR breaks down, like the furnace, air conditioner or water heater?
One way to help mitigate this fear is a home warranty. The great news about this home warranty is that more times than not, the seller is willing to include it in the purchase of their home. So, if this seller has not kept up on their deferred maintenance you are protected if any of the covered appliances and systems go down for a small deductible as little as $75. We go over this benefit with you in detail during our buyer consultation here at our office.
The Actual Costs
I love my parents! Let me preface this with that, but GEEZ they can scare the BE-JEEBUS out of you when it comes to buying a new home! Everything bad that can happen to your home, will, and will cost you at minimum $5,000 for each event!I know that they are only trying to protect us, but when they don’t like a home, parent’s find it hard to tell you that they don’t like your choice. Instead of hurting your feelings, they often try and scare you with maintenance horror stories.
Here is a list of average costs for upgrades and or replacement costs of most typical projects as a home owner.
Keep in mind, these costs can vary with location, market and even between contractors. It is always advisable to get at least three quotes when planning on spending a considerable amount of money on your next renovation project. We work with many trades and contractors and always keep a list of honest professionals. Let me know if you would like some contractor referrals, I’d be happy to send them your way.
Set Up A Reserve Fund
It is also not a bad idea to set up a reserve fund for maintenance and repairs. A survey showed that a homeowner can plan on spending 1-4% of their homes value per year on maintenance. Keep in mind this is an average over time. Roofs, for instance can be $10-$15k a pop, but they last for 25-30 years if installed correctly. Now in the Midwest, in places like Olathe or Lenexa, you can plan on replacing your roof more often with hail storms, but then your home owner’s insurance usually gets involved there.
So if your home is worth $150k plan on putting $1500 aside a year on improvements and projects to keep your investment running smoothly and by keeping up on deferred maintenance you are saving tons of money in the long run. Go to your bank and have them set up a savings account and label it “Home Repairs” and put in $100 a month into it. If after 5 years you haven’t really needed to use it you may just cap it at that and be okay.
Thanks again for all those who helped put this survey together!
So what crazy DIY projects have you taken on and either surprised yourself with how well they turned out, or did something crazy happen that you can laugh about. Leave a comment below and let us know!
Thanks again for reading! As always, our business is as amazing as it is due to friends and family like you. Without your referrals we would not be here today. Thank you for trusting us with your family and friends!