How much should you budget for home repairs?

Consider these 4 questions to set up a home maintenance fund.

April 4, 2018

Buying a home might be one of the most exciting times in your life. It’s full of possibilities, but it’s also full of a whirlwind of paperwork and financial hurdles. One of those hurdles that can easily get lost in the shuffle of mortgage documents and closing costs: saving money for emergency home repairs.

“Homebuyers rarely consider how much it will cost to own, operate and maintain a house,” says Ilyce Glink, author of “100 Questions Every First-Time Home Buyer Should Ask” and publisher of ThinkGlink.com, a personal finance and real estate educational website. “They’re very interested in looking at how much mortgage, taxes and insurance will cost, but if a homebuyer is on the edge of affordability, buying a bigger house with higher maintenance and upkeep could push him or her over the edge financially.”

In order to avoid this scenario, consider setting up a home maintenance and repair fund. But how much should you budget for home repairs, and how will budgeting for unexpected home repairs make your life easier as a homeowner? Consider the answers to the following four commonly asked questions:

1. How can a home maintenance fund help you?

Budgeting for unexpected home repairs helps to ensure that you have enough money to keep your home safe and in good working order. No one wants to deal with a leaky roof or a toilet that doesn’t flush.

For Lisa, who blogs only under her first name at Mad Money Monster, it literally took a lightning strike to encourage her to save money for emergency home repairs.

“I realized I needed to save for home repairs when lightning struck our neighbor’s tree on our fence line,” she says. “Unfortunately, it split and fell into my side yard. Interestingly, if a tree falls onto your property, regardless of where the roots live, you’re responsible.”

Luckily, Lisa explains, not only did the tree miss her newly installed fence by a few feet, but her neighbor agreed to pay for the cleanup, so mother nature’s havoc didn’t cost her anything. Had that not been the case, she says she was probably looking at $1,000 or more in cleanup and repairs.

“From that point on, I decided to dedicate a $100 per month for repairs in a separate bank account in order to be prepared for the unexpected,” she says.

Good thing, because when an ice storm hit a few years later, causing major damage to about 20 pine trees on her property and leaving her yard a mess of downed branches, she says she was able to tap these funds to pay for the $800 required to clean things up.

“The best part about having that home maintenance or repair fund is that I’ve eliminated the stress and worry that I dealt with before having one,” she says. “Even though I’m only saving $100 each month, that $100 adds up quickly and has come in handy more than once.”

2. How much should you budget for unexpected home repairs?

There are a couple of rules of thumb that can help guide you when budgeting for unexpected home repairs.