There are two important parts to home ownership: the purchase process and ongoing maintenance. Unprepared buyers focus on what they can afford immediately while savvy buyers take into account ongoing expenses that come with year-round maintenance. But how do you predict how much you’ll need each month? There are many variables that affect how budget for home repair, so you’ll need to estimate based on your home’s individual factors.

Method #1: Rules of Thumb

The 1% of sale price rule. One way to ballpark monthly savings for home repair is to use the one percent of sale price rule. If you spent $300,000 on a home, you’d allot $3,000 per year or about $250 a month for maintenance. This rule is meant to average annual costs needed in a ten year period rather than suggest your maintenance cost will be consistent every year. Watch out for flaws in this method. For example, perhaps you got a good deal because of deferred maintenance. You’ll need more than the average amount of savings to bring the home into the shape you desire, as well as budgeting for ongoing upkeep. Also, if you bought during a price peak, the 1% rule might generate too large a number.

The square footage rule. This rule estimates that you save one dollar for each square foot of your home. So the 2,200 sq. ft. home owner would save $2,200 per year (again, intended as an annualized cost over a ten year period) or about $183 per month. The logic here is that the more square feet of home you own, the more you need in savings for maintenance. Because the cost of labor and materials varies quite a bit by region, this estimate could be on the low side depending where one lives.

Method #2: Biggest Impact Factors
If you use one of the rules above to estimate a budget for ongoing maintenance, examine the following factors in your own home to help fine tune the accuracy of your number.

Age of home. New construction and homes between one and nine years need very little maintenance. Homes 10 to 20 years will need greater investment. Homes over 20 years will likely need some major components repaired or replaced such as roofing, a hot water heater, or an air conditioner.

Condition and past care. The older a home, the more the previous owners’ care affects the condition. A home’s structure and mechanical elements face wear and tear from weather, use, and often neglect. If you’re lucky enough to have a good working HVAC system, continue to invest in regular tune ups to lengthen the life of this expensive mechanical necessity. Homes don’t only need repair when something goes wrong, they need regular maintenance to keep things in their best condition.

Location. If your home is at the bottom of a hill where water collects or drains, resides in a flood plain or in a region with harsh winter conditions, it will likely face more than the average wear and tear.

So now how do you adjust your budget number? Let’s say your home cost $300,000 and is 2,200 square feet. Your rule of thumb budget numbers from previous examples were $3,000 and $2,200. Take the average of those two numbers, $2,600. Now add 10 percent more for each additional risk factor category your home falls under (age, condition, location). Let’s say your home is 15 years old, has faced some neglect, and is at the bottom of a hill. Add 30 percent to the $2,600 to arrive at $3,380 as your annual budget, or $282 monthly.

Method #3: Create a Predicted Repairs List with Costs

Some may prefer to add up hard numbers to set a budget. Below are some common home repair and maintenance items that are likely needed in a ten year period in a home. You can research pricing for the style of items you desire and put together numbers that reflect your taste and needs.

Roof: $7,000
Furnace: $3,500
Annual HVAC Service ($250/yr x 10): $2,500
Refrigerator: $700
Stove/Oven: $700
Microwave/Range Vent: $500
Dishwasher: $600
Washer: $1,100
Dryer: $1,100
Hot Water Heater: $1,200
Plumbing: $7,000
Electrical: $2,000
Carpet/Flooring Replacement: $6,500
Exterior Paint: $3,500
Interior Paint: $600
Deck: $2,000
Driveway: $4,000
Landscaping: $1,800

TOTAL $46,300

Take the total of these ten-year costs and divide by ten. $46,300 divided by 10 equals $4,630 and serves as your annual savings budget, or $386 monthly. You may not need the full amount one year, but require more the next year. Despite this list, you might need to replace a hot water heater twice in a decade and not have to replace a furnace at all. While you can’t predict every need, setting up a budget for your home’s maintenance allows you to retain its best condition. And it puts you in a better position to hold your home’s value when it comes time to sell.