Noah has just purchased a previously owned home. He put $5,000 towards a down payment and took out a $65,000 mortgage. Noah knows that his older home will need maintenance right away and wants to budget enough for this coming year for unexpected expenses. When estimating costs for home repair and maintenance, a good estimate is to budget 1% of the purchase price of a house. What would be a good yearly estimate of repairs and maintenance for Noah’s home? a. $1550 b. $700 c. $650 d. $150
A good estimate is 1% of the original price, as stated. Original price: $6500 estimate = $6500 x 1% = $650 The answer is C.