Know how to put your mortgage back

Building maintenance reserves

(rh) Anyone who owns a house or apartment must also maintain it. It does not pay off to neglect ongoing and regular building maintenance. On the contrary: On the one hand, a poorly maintained or even run-down property loses value, on the other hand damage can occur, the costs of which are much higher than the “saved” maintenance costs.

Make some reserves

Most homeowners know that they should set aside money for building maintenance. Still, not all of them do it - even though the day-to-day maintenance and ancillary expenses were part of the banks' sustainability calculations when they applied for their mortgage. The banks calculate one percent of the purchase price per year for building maintenance if the house or apartment is new or newly renovated and in perfect condition. That is 6,000 francs a year or 500 francs a month if your dream house or apartment cost 600,000 francs. This percentage is divided into ancillary costs and ongoing building maintenance (two thirds) and major purchases and renovations (one third).

An account for the reserves

The easiest way is to transfer the reserves for building maintenance every month with a standing order to a specially opened account. Then you have the money to spend and not just budget in case you need to have something repaired or replaced. In the beginning you will amass money. From the 10th year you will need it for maintenance measures (see table «Lifetime»).

As an alternative, you can pay two thirds of the reserves (short-term maintenance) into your existing account and add a third (long-term maintenance) for amortization and set aside indirectly. If there are major purchases or repairs, add the investment costs to the mortgage. You risk, however, that your bank will reject the mortgage increase or increase the amortization payments because they valued the property lower or because you earn less than when you took out the original mortgage.