Photo of a Couple Going Over Budget

Are you wondering how much to budget for home repairs and maintenance?

If so, you’re not alone.

Coming up with a home maintenance budget estimate is something that many smart homeowners set out to accomplish.

Having a house is exciting, but we can’t forget that it also requires routine investment to keep it good shape.

It would be awful for you to suffer from a serious financial setback just because you didn’t have enough money saved in the bank for unexpected repairs.

Our goal is to help you prevent that from happening.

In this post, we’ll share two rules of thumb for how to properly budget for yearly house maintenance costs. We’ll also go over some important factors that you’ll want to consider when deciding how much money you really need to stash away.

At the end, we’ll leave you with a simple tip that you can use to make it easier to save money for your home maintenance fund.

Home Maintenance Budget Rule of Thumb #1

A general rule of thumb for smart budgeting is to set aside at least 1% of your property’s purchase price each year in a savings account that’s reserved for home maintenance and repairs.

If your house is not in the best shape or you’re expecting a lot of repairs to be needed over the course of ownership then you may want to increase your savings to 3%.

For example, if your home cost $200,000, the 1% rule says that you should save $2,000 each year for maintenance costs. The 3% rule would amount to $6,000.

Now, this doesn’t mean you’ll spend $2,000-6,000 dollars every year, but over time (10+ years) it usually averages out to be this much.

Some years you may spend very little; a small amount on landscaping, for instance, will cost $200-500. Other years you could pay a lot more; a roof repair ranges between $3,000-10,000.

Home Maintenance Budget Rule of Thumb #2

Another home maintenance budget rule of thumb you can follow is to set aside $1 for ever square foot of your house to use for yearly upgrades and repair costs.

For example, if you own a 1,500 square feet home then you’ll want to save $1,500 ($1 x 1,500) each year for maintenance. Just like we mentioned above, you may not use all $1,500 each year, but over the long term of home ownership it tends to average out to be this much.

Keep in mind, however, that this rule doesn’t take into account the costs for labor and materials.

If you plan to hire someone to do your home repairs for you then the price will fluctuate depending on where you live. If you’re going to make upgrades and repairs yourself then this rule of thumb should be more accurate.

Additional Factors to Take into Consideration

Rule of thumbs are great for getting an initial estimate for how much money to save each month, but there are other factors you should be aware of which can affect how much to budget for home repairs and maintenance.

Add an additional 10% to your yearly budget for each of the items listed below that negatively impacts your house.


Single-family homes require a larger maintenance budget than condos, town (row) houses and duplexes. Obviously, the larger the property, the higher repair costs will be for major components like a roof or HVAC system.


The age of a home is a very important point to consider. Newer homes built within the last 10 years don’t often require very much maintenance. Homes that fall within the 10 to 20 year old range usually need a moderate amount of repairs. It’s homes that are 20 years and older that need the most maintenance. If major items haven’t been replaced yet, like a roof, furnace or hot water heater, chances are they’ll need to be serviced or repaired sometime soon.

Overall Condition

Every homeowner has a different level of care and involvement with the upkeep of their property.

There are some homes that are more than 100 years old and in excellent condition because the previous owner(s) maintained them well. Then, there are other houses that may be a lot newer, but are falling apart everywhere you look because of poor maintenance and neglect.

If your home was maintained well by previous owners, then you’re repair costs shouldn’t be out of the ordinary. However, if your house didn’t get the love and attention it deserves before you took ownership, you may have to budget higher for it.


The location of your home can impart different environmental stresses that may require higher maintenance.

For example, a house located in a floodplain has a higher risk of water damage than one positioned at the top of a hill. Alternatively, a rural property surrounded by lots of trees will need more exterior maintenance in the fall when the leaves drop versus a home located in a city.

Weather Concerns

Properties that are located in places which have extreme weather conditions tend to have higher maintenance costs.

For example, if your home is located on the coast and experiences heavy rains or hurricanes then you’ll want to estimate for yearly costs of exterior wear and tear. Similarly, houses that get pounded by lots of ice and snow will be under a lot more strain than ones where it rarely drops below 70 degrees Fahrenheit.

A Realistic Example of Home Maintenance Budgeting

Now that you’re equipped with two rules of thumb and know what additional factors to consider when making a home maintenance budget estimate, let’s put the things you learned into practice with a realistic example.

House Factors

  • Purchase Price: $250,000
  • Square Footage: 1,750
  • Type: Single-family
  • Age: 35 years old
  • Overall Condition: Great shape, well maintained
  • Location: Suburbs, without any major concerns
  • Weather Concerns: Lots of ice and snow

The 1% purchase price rule would advise setting set aside $2,500 for yearly maintenance costs.

The square footage rule would recommend saving at least $1,750.

In order to get the best estimate, we suggest that you take an average of the two rules. In this case, it would be ($1,750 + $2,500) ÷ 2 = $2,125.

Once you have a realistic starting number, then you can start adding in the 10% for each additional factor that adversely affects your property.

In our example above, Overall Condition and Location are not an issue, so no adjustment is needed for those two factors. However, Weather Concerns indicated lots of snow and ice, so it would be smart to add 10% to your budget because of it.

Here’s how the math breaks down:

  • $2,125 x .10 = $212.5 additional savings per year for Weather Concerns
  • $2,125 + $212.5 = $2,337.50 total for a yearly home maintenance budget or $194.79 per month

Keep in mind that this is just an estimate. There’s no way to predict exactly how much money your home maintenance and repairs will cost each year. The best thing you can do is make a guess based on the rules of thumbs provided above and the unique factors that may affect your home.

An Easy Way to Save Money for Your Maintenance Fund

If you’ve already owned several homes in your lifetime then the numbers in the example above shouldn’t be too surprising. Perhaps you’ve experienced first hand the true cost of home ownership and are now trying to determine a realistic budget.

On the other, if you’re in the market to buy your first home or just recently became a new homeowner, you may be wondering how you’ll come up with enough cash to have on hand for maintenance purposes.

While it may seem hard to save an extra $100-300 per month for maintenance and repairs, there’s something simple you can do that will help free up cash for this purpose.

Be Smart About Home Energy Usage

One of biggest expenses you’ll face as a homeowner is the cost to heat and cool your house. According to the U.S. Department of Energy, heating and cooling accounts for more than half of the energy used in a typical home, with the average family spending around $2,000 per year for this purpose.

The Department also reports that you can save up to 50% on your cooling bill by investing in an energy-efficient portable air conditioner or window air conditioner, and by only cooling one or two rooms at a time instead of the entire house.

In comparison, a portable or window AC unit only costs about $10 to $50 per month (depending on the amount of use) while a central AC unit can easily cost $100 or more.

Save Money By Using a Portable or Window Air Conditioner

If you’re interested in cutting your energy bills in half each month then take a look at our in-depth guides on these home cooling solutions:

If you’re not sure which one of these types of air conditioners is better suited for your home, we have another guide that can help answer that question:

Keep in mind that this same advice also applies to heating your home. By heating just one or two rooms at a time and keeping your thermostat set low you can save a considerable amount of money over the winter months.

You’d be surprised at how much money you can actually save each year by being smart about your home energy use. Even shaving off just $50 each month from your energy bill can make it much easier to budget for home maintenance and repairs.

Consider Using a Budgeting App

If you’re serious about creating a budget for your home repair needs and sticking to it, you may want to consider using a budgeting app.

Sure, you can do your budgeting with pencil and paper, but an app does all of the calculations for you and can make it easier to stay on top of bills and meet your financial goals.

There’s a really good free app called Mint that works on mobile devices and desktop computers. It’s really versatile and allows you to set budgets for different categories of spending.

By setting up a budget item for home maintenance you can ensure that you stay on track each month and build up enough funds to cover your future needs without having to track it manually.