fbpx

How to cushion the cost of fixing your home

Published on November 25th, 2020
  Written by 
Bill Tsouvalas
Bill Tsouvalas is the managing director and a key company spokesperson at Savvy. As a personal finance expert, he often shares his insights on a range of topics, being featured on leading news outlets including News Corp publications such as the Daily Telegraph and Herald Sun, Fairfax Media publications such as the Australian Financial Review, the Seven Network and more. Bill has over 15 years of experience working in the finance industry and founded Savvy in 2010 with a vision to provide affordable and accessible finance options to all Australians. He has built Savvy from a small asset finance brokerage into a financial comparison website which now attracts close to 2 million Aussies per year and was included in the BRW’s Fast 100 in 2015 as one of the fastest-growing companies in the country. He’s passionate about helping Australians make financially savvy decisions and reviews content across the brand to ensure its accuracy. You can follow Bill on LinkedIn.
Our authors



Fact checked

At Savvy, we are committed to providing accurate information. Our content undergoes a rigorous process of fact-checking before it is published. Learn more about our editorial policy.

At Savvy, our mission is to empower you to make informed financial choices. While we maintain stringent editorial standards, this article may include mentions of products offered by our partners. Here’s how we generate income.

In this article

It is the little things that count the most when it comes to saving on the maintenance and repair costs of your home to avoid paying through your nose later in the year. Getting to keep your home in mint condition means that you will have to get up close and personal but having a plan in place can also make it less overwhelming. These three handy tips will help you take care of the small problems before they get out of hand.

Have a maintenance plan in place

A home, as you know, comes with valuables and your precious belongings that can break or get damaged. Not having a maintenance plan in place can end up having you paying double the amount to get it fixed or replaced. So why wait until the worst happens?

A maintenance plan is a savvy way to save you hundreds of dollars. Think of it as a budget, but for your home. Opening a savings account for those rainy days can come in handy, especially when the thing you need to replace is one of importance.

However, it will be beneficial if you save according to what is within your financial reach. According to ASIC, 17% of Australians fail to follow through with a savings plan due to the goal being unrealistic. This is where knowing your numbers will come in handy.

The rule of thumbs to help you prepare

Your home is not the same as the next and it doesn’t share the same furniture as the next. But there are a few guidelines you can use to help maintain and repair your home. The first general rule of thumb is that you shouldn’t spend more than 5% of your home’s purchase price to repair and renovate your home.

Thinking ahead can save you money, but it can also help you figure out how to use various finance options to supplement your savings. For example, if you need to top up your savings to adequately carry out a renovation project to completion you might consider taking out a renovation loan or using your home loan to cover the costs.

The 1% rule of thumb is another guideline that you consider which means that 1% of the purchase price of your home should be put aside to carry out ongoing maintenance costs. This basically means that if you purchased your home for $600,000 you will need a budget of $6,000 to carry out the maintenance costs.

This doesn’t mean that you will spend $6,000 p.a. on keeping your house in good condition, but it can act as a safety net for fixtures that you will need to carry out. Keep in mind that it could also be subject to change depending on what needs to be fixed.

Try on a coat of paint instead of tearing down the walls

Sometimes you do not have to tear down the walls of your place to have it looking and feeling the way you want it to. Renovations do have their place, but sometimes it can be costly and unnecessary. Australians forked out $8 billion for renovations in the previous year.

You could give your house a facelift by getting up close and personal with problem areas. This means on weekends you could take a walk around your house to see what needs to be fixed or painted to be restored to its former beauty.

A DIY facelift doesn’t have to break the bank. Sometimes all you need is a new coat of paint on the walls, varnish your wooden surfaces colourful cushions on an old couch or the repositioning of furniture in a room which can help you save in the process.

Always keep in mind to constantly assess the condition of your home to see what needs to be trimmed, fixed, or painted to save you time and money at the end of the year.

Did you find this page helpful?

Yes
No
Thanks for your feedback!

This guide provides general information and does not consider your individual needs, finances or objectives. We do not make any recommendation or suggestion about which product is best for you based on your specific situation and we do not compare all companies in the market, or all products offered by all companies. It’s always important to consider whether professional financial, legal or taxation advice is appropriate for you before choosing or purchasing a financial product.

The content on our website is produced by experts in the field of finance and reviewed as part of our editorial guidelines. We endeavour to keep all information across our site updated with accurate information.

Approval for home loans is always subject to our lender’s terms, conditions and qualification criteria. Lenders will undertake a credit check in line with responsible lending obligations to help determine whether you’re in a position to take on the loan you’re applying for.

The interest rate, comparison rate, fees and monthly repayments will depend on factors specific to your profile, such as your financial situation, as well as others, such as the loan’s size and your chosen repayment term. Costs such as broker fees, redraw fees or early repayment fees, and cost savings such as fee waivers, aren’t included in the comparison rate but may influence the cost of the loan. Different terms, fees or other loan amounts may result in a different comparison rate.

In this article

Share this article

Share on facebook
Share on twitter
Share on linkedin
Share on email
Share on pinterest

Looking for a home loan?

Compare Australia’s reputed home loan lenders with us and save.

* Terms and conditions and lending criteria apply.

Smart money saving tips

Subscribe to our newsletter.

By subscribing you agree to our privacy policy

Related articles

Easily compare home loan options today

We compare home loan options for you so you can be assured you’re seeing the most competitive interest rates available in Australia.

We'd love to chat, how can we help?

By clicking "Submit", you agree to be contacted by a Savvy Agency Owner and to receive communications from Savvy which you can unsubscribe from at any time. Read our Privacy Policy.