How much should buyers budget for repairs?
As a new homeowner, you realize that you’ve taken on a big financial responsibility. At some point, home repairs will increase that financial obligation. Fortunately, if you plan, you can make sure you have the funds to cover the biggest repairs.
Here are a few tips to consider to keep you from being overwhelmed when the repair bills come in.
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Start your home repair fund now Get to Know Your Home
Your home inspection report is a tool for looking at your home piece-by-piece and figuring out what might go wrong in the future. It lists all of the major systems in your home, the appliances, the roof, and many other components. It may also show age, condition, etc. In short, it’s a master list that can help you figure out what repairs you might need down the road.
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Establish a Home Repair Fund
Unanticipated repairs can be frustrating. It’s even more frustrating when you don’t have the money to pay for them. That’s why it’s important for you to establish a home repair fund. You should begin by setting aside a large lump sum then adding to it monthly or weekly. How much should buyers budget for repairs? The prevailing wisdom suggests that you set aside an amount equivalent to 1 to 3% of your home cost. That’s $2,000. for a $200,000 home.
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Consider DIY to Save Repair Costs
As you get to know your home, you’ll become comfortable with performing DIY tasks. While you might not want to replace your roof, you may feel good about installing a faucet, repairing your gutters, or patching your driveway. Every home repair task you’re willing to perform will reduce your repair costs and help keep your repair fund intact.
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The Home Warranty Option
Home warranties are another option for managing home repair costs. Depending on the type of coverage you purchase, your warranty will pay to repair or replace specified major appliances and home systems if they fail. They’re not for everyone. Check into them carefully to see if it’s a viable option for you.
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Don’t Finance Your Home Repairs
When you have a home repair fund, it eliminates the temptation to go into debt to repair your furnace, plumbing, or roof. The debt and interest incurred to repair a major item could become a fixture in your life for years to come.
When you’re ready to start your search for a new home, let’s schedule a time to meet. We can discuss points about the home buying process you may not have already considered. Using my experience in the real estate business can make your home buying experience easier.