How much should I budget for home maintenance?

The 1% rule — and when it's wrong

The standard guidance is to set aside 1% of your home's value every year for maintenance. On a $400,000 home that's $4,000 a year, or about $333 a month. It's a decent starting point for a house built in the last 15 years with a newer roof and HVAC.

It's badly wrong for older housing stock. A 1950s home with original galvanized plumbing, a 22-year-old roof, and a furnace at the end of its life can easily run 3%–4% in a bad year. Climate matters too: coastal salt air, hail belts, and freeze-thaw regions all shorten the life of exterior systems.

What actually breaks, and what it costs

The five expenses that wreck budgets are roof, HVAC, water heater, sewer line, and exterior paint or siding.

Roof — 20–30 years of life, $9,000–$25,000 to replace. HVAC — 12–18 years, $6,000–$14,000 for a full system. Water heater — 8–12 years, $1,400–$3,500. Sewer/main line — often the surprise, $4,000–$20,000. Exterior paint or siding — 7–12 years, $5,000–$20,000.

Ask your home inspector for the *age* of each system, not just its condition. Age tells you when the bill arrives; condition only tells you it hasn't arrived yet.

How to fund it without panic

Open a separate high-yield savings account the month you close and automate a transfer equal to 1/12 of your annual target. Treat it as a bill, not a leftover.

If you bought with a low down payment and closed with thin reserves, start at $150–$200 a month and step it up with every raise. A funded repair account is what keeps a broken water heater from becoming credit card debt — which is the actual path most first-time owners take to trouble.

Seasonal upkeep — gutters, HVAC filters, water heater flush, dryer vent — costs a few hundred dollars a year and reliably delays the expensive replacements.