Breaking Down The Average Home Maintenance Costs Per Year Staff Staff

Quick facts:

  • A good baseline estimate of how much you should save for annual home maintenance is to take 2% of the current home value and use that as a starting number for your budget.
  • There are many factors that affect the average cost of home repairs including age of home, cost of living in a given area, and regional labor shortages.

There are very few decisions more financially impactful than buying a home. And while most people think about the obvious ones, like applying for the initial home loan, property taxes, and home insurance, one that oftentimes is forgotten about during the buying process is home maintenance.

Most homeowners conduct a thorough home inspection during the process, and get a laundry list of things that will likely need attention in the future, but rarely is the cost of unexpected repairs or general upkeep considered in the budget.

[Read: The Best Homeowners Insurance Companies ]

In order to paint a clear picture for prospective home buyers and new homeowners, the research team dove into the data around the average cost of home maintenance and repairs every year to offer guidance on how much one should save. This guide will take into account things like the likelihood of surprise repairs, routine maintenance, shifting materials costs, labor cost fluctuation, and geographical location. This probably doesn’t surprise anyone, but it’s more likely a home built in the early 1900s in San Francisco, California will likely be more expensive to maintain than new construction in St. Louis, Missouri. 

This article breaks down approximately how much you should save each year for routine home maintenance and emergency repairs, based on our analysis of average repair costs associated with owning a home.

Start with an initial budget of 2% of home value for annual costs. Then follow along with the below table to determine how much money you should have saved per home:

What to consider% Increase or decrease in budget
Age of home:+0.2% of home value for every 10 years
High cost of living region:+1% of home value
Low cost of living region:-1% of home value
Skilled labor shortages:+.1% for every 2 years moving forward

A Baseline Estimate of Average Home Repair Costs per Year

While impossible to be specific for each and every home, the conventional wisdom around home ownership and the annual cost to maintain a house is that homeowners should plan to spend somewhere between 2-4% of the house’s value in repairs every year.

Example average home maintenance budgets:

  • A $100,000 home with 4% budgeted for home repairs and maintenance every year would mean the homeowner should have $4,000 set aside to pay these costs without incurring any extra debt.
  • A $800,000 home with 2% budgeted for home repairs and maintenance every year wold mean the homeowner should save $16,000 to pay these costs without incurring any extra debt
  • The estimated median home value in the United States is currently around $200,000, meaning the average homeowner should keep somewhere in the ballpark of $8,000-$16,000 in savings every year to cover maintenance and emergency home repairs.

One important note regarding budgeting for maintenance and repairs is that there will be years where it’s more than likely that nothing will go wrong or no maintenance will be required. However, in order to prepare for any catastrophic failures (major plumbing or electrical issues, remodels, new roofs, etc.) keeping a growing savings to cover these costs will prevent financial hardship.

[ Read: Homeowners Insurance Buyer’s Guide ]

How Does the Age of the Home Affect Maintenance Costs?

The simple fact is that older homes cost more to maintain. Given that materials wear down through years of use, construction standards change every decade, and technology improves the way home builders construct new homes, it’s impossible not to consider the things that might need updates and repairs in an older home.

However, it’s also more likely to find an older home at a better price meaning budget can be saved there. Fixer uppers, while not for everyone, can be a great way to add your own equity to a home’s value.

And another thing, a house that has been standing for eighty years has already stood the test of time and will likely continue to do so for years to come. 

One general contractor we spoke with about the costs of maintenance said, “Older homes are great, if they’ve been standing for eighty years, you know they’ll probably be standing in another eighty.”

Still, using the above scale, it’s fair to make some assumptions about how older homes increase the overall maintenance required and potential room for repairs; that dishwasher from the 1980s is going to need to be replaced soon, and the old knob and tube in that 1930s fixer upper will need to be removed at some point.

When considering a budget, if your home is older, it is recommended you plan for a higher percentage of the above guidance. Taking the national average of about 2% of home value per year and adding at least 1% to your budget would likely be safest when thinking about older homes.

Some Areas Are More Expensive Than Others to Have Home Repairs Done

Not only do home values vary greatly depending on where you are looking to live, so do the costs of home repairs. A roof replacement in a more expensive city like Seattle, San Francisco, or Washington D.C., is going to also cost more in comparison to more affordable parts of the country. As the cost of living goes up in any city, so do home maintenance costs.

If one is to take the above averages, it’s safe to assume a premium of at least .5% – 2% additional budget required to keep a home maintained in a high-cost city. Keep in mind too, that in these more expensive cities, home values are higher, meaning the overall budget exponentially increases. Alternatively, buying and maintaining a home in a lower cost of living area means it’s safe to subtract up to one percent from the cost of doing annual repairs.

Speaking with one contractor about the market effects here, he also commented on how bigger, more populated areas create considerably more demand.

“Seattle, where I’m based, has seen a boom in real estate demand, and it’s all on a bunch of older homes too, meaning home maintenance and repair costs in the city have jumped considerably over the last economic boom.”

How Disappearing Skilled Labor Is Increasing Home Repair Costs

One thing to keep in mind is that the past ten years has seen not only considerable economic growth, but a decrease in the number of skilled labor professionals. A study by Globaltranz in 2018 found that there is currently a shortage of at least three million trade jobs in the United States alone.

There are many reasons for this, but it does not look like a trend that is going to slow down anytime soon. Over the next several decades, it is fair to assume that the cost of home repairs and maintenance will increase as the skilled labor pool continues to shrink creating spikes in demand.

Photo by James Osmund / Gettyimages

About the Authors

The staff is dedicated to providing you with all the deep-dive details. Our writers, researchers, and editors came together from Charlotte, Seattle, San Juan, Fort Worth, Fort Lauderdale, San Diego, and Chicago to put this review together.