When calculating the cost of homeownership, it’s important to include not only everyday costs, such as mortgage payments, utilities and property taxes, but also inevitable home-repair expenses. Some of the most common home repairs involve plumbing fixtures, patios, fences and driveways, heating and air conditioning systems, and painting both inside and out. You’ll also likely want to make home renovations at some point over the years.
The good news is, keeping up with home maintenance or making renovations will preserve or enhance your home’s value; however, it’s crucial that homeowners plan ahead for the costs involved. Here are five quick tips from BMO Harris Bank:
1. Contribute small amounts of money regularly to an emergency fund for maintenance and repairs. The money will add up over time and be there for when disaster strikes or you decide to make a home improvement.
2. Understand how a repair or renovation will impact the value of your home by researching which renovations create increased value and are popular selling features. Conversely, making unpopular changes could ultimately hurt your home’s appeal and value when you decide to sell it.
3. Think long term when making financial decisions. Whether you’re using savings or borrowing to renovate, take the time to meet with a financial expert to ensure your renovation meets your long-term financial objectives.
4. Expect the unexpected. Be financially prepared for things to go awry during a project, such as a leaky roof, broken pipe or other course corrections that may occur. This could significantly increase the cost and time it takes to finish a project.
5. Get renovation quotes in writing, and understand what guarantees the contractors provide. For example, if the cost of the plumbing in your renovation is more work than expected, will the quote go up?
Although no one has a crystal ball, financially preparing for repairs and renovations is a smart move for all homeowners!