Yard work and do-it-yourself projects are among the jobs that homeowners reserve for weekends, looking for ways to cut costs and enjoying the time accomplishing minor home improvements or beautification.
At least that's how the story goes.
New research indicates that many property holders hire providers or small crews to handle residential maintenance such as landscaping and spend on home security, pool care and other services. Bankrate financial analysis website found that 63 percent of property holders use at least one "recurring home maintenance provider," while 35 percent use two. The costs can be significant: Bankrate says homeowners pay $2,000 a year on maintenance services, while The Balance website says the rule of thumb is 1 percent of the home value or $3,000 a year on a $300,000 home.
Bankrate says maintenance costs are little noticed by many homeowners, who worry about formidable bills such as mortgage payments, insurance premiums and property taxes. Yet the smaller expenses can add up, too. The financial researcher estimates that housekeeping can cost an average $285 a month; homeowner's association dues, $210; landscaping, $144; home security system, $130; pool care, $123; snow removal, $84; septic service, $67 and trash and recycling collection, $55.
"The price of biweekly landscaping probably never factored into your calculus when deciding how much house you can afford," Bankrate notes in an article last month.
Property owners do face major home-related expenses. Down payments work out to 11 percent of the home price for new buyers. Mortgage loans averaged close to $250,000 last year, according to the National Association of Realtors. That works out to a $973 monthly principal and interest payment, about one-sixth of median family income, Bankrate points out.
The average property tax bill hit $3,300 – or $275 a month – in 2016, according to the latest figures from ATTOM data solutions company. Home insurance premiums can cost hundreds of dollars a month depending on location and type of house, Bankrate discloses.
In the Bankrate story, Kevin Mahoney, chief executive of fee-only financial advice firm Illumint, recommends setting up a “home maintenance fund.” The advisor recently bought a renovated row house in Washington, D.C., and contributes $100 to $200 a month "as a hedge against unexpected repairs and wear-and-tear," Mahoney notes in the article.
Nate Masterson, a director of finance for Maple Holistics, would pays $1,000 annually for gardening services, and another $70 to clear his Riverside, New York, home of snow, according to Bankrate.
“It would require a lot of strenuous work to perform either task, and it’s simply more worthwhile for me to pay a professional,” Masterson told the website.
Separately, renters pile up certain maintenance costs but not to the degree of homeowners. On average, tenants pay $128 a month for housekeeping, $71 on HOA dues, $70 for pool care, $61 on landscaping and $34 for snow removal. More pricey services are $142 on security systems, $113 for septic service and $63 on trash and recycling collection.
Bankrate says that residents should at least set up an emergency fund with enough money for three to six months' worth of expenses, and sock it away in a high-yield savings account. Cash-strapped property holders should "strongly consider" suspending as many services as possible until the emergency fund is full. "Dropping almost $300 a month on housekeeping while lacking $1,000 in the bank is simply too risky," the financial company says. "What if the roof caves in? At the very least, start contributing to a home maintenance fund."
Financial observer Paula Pant, writing last November in The Balance personal finance and investing website, says homeowners should keep in mind two rules for determining maintenance costs. Setting aside 1 percent of the home's purchase price should cover expenses over the long term, since year-to-year costs may fluctuate.
A second guide is the "square foot rule." Budget $1 per square foot per year for maintenance and repair costs. For a 3,000-square-foot home, figure on spending $3,000 a year for maintenance and repairs. However the guide doesn't factor in labor and material cost, which can be more expensive depending on the region.
Other benchmarks include age of the property. "New construction – a home built within the last 5-10 years – will need very little maintenance," according to the article. "Once a home turns 20-30, though, there’s a good chance that major components, such as the roof, hot water heater, and some piping, may need to be replaced."
Weather also can be a factor, putting more strain or wear-and-tear on cold-weather homes hit by freezing temperatures, ice, and snow; or warm weather places more likely to be impacted by termites, high winds, heavy rains and other extreme weather conditions or pest infestations, the author says.
Location can be troublesome, if the homes are located at the bottom of a hill where water drains and collects or in a floodplain with environmental stresses.
Single-family homes typically require a larger maintenance budget to guard against replacing a roof, siding and gutters and maintaining a yard. Condo and townhomes don't need as steep a maintenance budget; the homeowners association will care for the exterior.
The Balance writer suggests averaging the figures from the 1 percent rule and the square foot rule to come up with a bottom line total. Then, to play it safe, add 10 percent for each factor including weather, condition, age, location and type.
"It’s hard to predict how much your home will cost to maintain," Pant adds. " The best you can do is make an educated guess based on your home’s unique factors."