Home maintenance costs are one of the easiest expenses for new homeowners to underestimate.
A buyer may plan for the mortgage payment, property taxes, insurance and closing costs, then get surprised by a broken water heater, leaking roof, HVAC repair or appliance replacement. Unlike renting, homeownership means the owner is responsible for the repair bill.
Fannie Mae says a common rule of thumb is to budget 1% to 4% of a home’s value per year for maintenance costs, including repairs and replacements. Fannie Mae notes that a newer home may be closer to the low end, while a home more than 30 years old may justify a higher savings target.
Key takeaways
- Homeowners should budget for routine maintenance and emergency repairs.
- Fannie Mae suggests setting aside 1% to 4% of the home’s value per year.
- Freddie Mac says homeowners should plan ahead for major purchases and improvements.
- Newer homes may cost less to maintain at first, but no home is maintenance-free.
- Older homes, larger homes and homes in harsher climates may need bigger reserves.
- Maintenance should be part of the homebuying budget, not an afterthought.
Why maintenance costs surprise new owners
Many first-time buyers are used to calling a landlord when something breaks. After closing, that responsibility shifts to the homeowner.
Common maintenance and repair categories include:
- roof and gutters,
- HVAC service,
- plumbing repairs,
- electrical repairs,
- water heater replacement,
- appliance repairs,
- pest control,
- lawn care,
- exterior paint or siding,
- windows and doors,
- drainage,
- and seasonal upkeep.
Freddie Mac advises homeowners to set aside time and money for maintenance tasks such as lawn care, gutter cleaning and appliance upkeep, and to plan ahead for major purchases and improvements such as a roof that may need replacement.
The 1% to 4% rule
The 1% to 4% rule is a simple starting point.
| Home value | 1% annual budget | 4% annual budget | |—:|—:|—:| | $300,000 | $3,000 | $12,000 | | $400,000 | $4,000 | $16,000 | | $500,000 | $5,000 | $20,000 | | $750,000 | $7,500 | $30,000 |
That does not mean every homeowner will spend that exact amount every year. Maintenance costs are uneven. One year may be quiet; the next may include a roof, HVAC or plumbing repair.
The purpose of the budget is to avoid being financially unprepared when a large repair arrives.
Actual spending can vary widely
Survey data also shows that home spending can be significant.
Angi’s 2025 State of Home Spending Report said U.S. homeowners spent an average of $12,472 in 2025 across home projects. Within that total, average home maintenance spending rose to $2,041 per household, while emergency repair spending increased to $1,143.
Those figures are not a universal budget target because they include survey-based averages and project categories that vary by household. But they do reinforce the larger point: maintenance and repairs are real ownership costs.
What new owners should budget first
New homeowners should divide maintenance planning into three buckets.
Routine upkeep: recurring tasks such as HVAC servicing, gutter cleaning, lawn care, pest control, filter replacement and minor repairs.
Near-term repairs: items noted in the inspection report that may need attention in the first 12 to 24 months.
Major replacements: roof, HVAC, water heater, windows, major appliances, siding, driveway, sewer line or electrical upgrades.
The inspection report should become the first maintenance planning document. A buyer should not read it once and forget it. It should be turned into a repair timeline.
Home age changes the budget
A newer home may have lower maintenance costs early, especially if major systems are under warranty. But new homes still require maintenance, and warranties may not cover everything.
Older homes may need more reserve funds because major systems can be closer to replacement. Roof age, HVAC age, plumbing material, electrical panel condition and drainage can all affect the budget.
A small, newer townhouse may need far less maintenance savings than a large older single-family home with a big yard, older systems and deferred repairs.
Maintenance and affordability
Maintenance should be included before deciding how much house to buy.
A buyer who can barely afford the monthly payment may struggle when the first major repair arrives. Freddie Mac’s homebuying budget guidance reminds buyers to set aside money for unexpected emergencies, including necessary home repairs.
That means the right affordability question is not only “Can I buy this home?” It is also “Can I maintain this home?”
What this means
Home maintenance is not optional. It is part of the cost of protecting the property.
New owners should create a monthly maintenance savings line, review the inspection report, price likely repairs and keep emergency savings separate from renovation wish-list money. A home that looks affordable before maintenance may become stressful if the owner has no repair reserve.
The best time to budget for repairs is before they happen.
FAQ
How much should homeowners budget for maintenance?
Fannie Mae says a common rule of thumb is to budget 1% to 4% of the home’s value per year for maintenance, repairs and replacements.
Is the 1% rule enough?
Sometimes. It may be enough for newer homes, but older homes or homes with aging systems may need a larger budget.
What are common home maintenance costs?
Common costs include HVAC service, gutter cleaning, roof repairs, plumbing, electrical work, appliances, pest control, lawn care and exterior maintenance.
Should buyers use the inspection report for budgeting?
Yes. The inspection report can help identify near-term repairs and systems that may need future replacement.
Are home improvements the same as maintenance?
No. Maintenance protects the existing home. Improvements may upgrade or remodel the home. Owners should budget separately for both.
Sources with clickable URLs
- [Fannie Mae — How to Build Your Maintenance and Repair Budget](https://yourhome.fanniemae.com/own/how-build-your-maintenance-and-repair-budget)
- [Freddie Mac — Maintaining Your Home](https://myhome.freddiemac.com/owning/home-maintenance)
- [Freddie Mac — Homebuying Budget Guide](https://myhome.freddiemac.com/blog/homebuying/budget-guide)
- [Angi — 2025 State of Home Spending Report summary](https://ir.angi.com/news-releases/news-release-details/millennials-are-driving-future-home-spending-according-angis)
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