Hi guys! Can you please help me out?One of my rentals is really old (almost 100 years old) and never really game me any problems, which led me thinking of buying a 100 year old fourplex.How do you usually plan your expenses on those old buildings ? Do you think like this: 1) sewer can go bad= anywhere from 10K-30K2) roof 10K3) electrical 10K4) some reno on the inside 10KOr do you have another method?I am stuck on how to calculate cap-ex on old (100 year old) homes.Thank you! Hi guys! Can you please help me out? One of my rentals is really old (almost 100 years old) and never really game me any problems, which led me thinking of buying a 100 year old fourplex. How do you usually plan your expenses on those old buildings ? Do you think like this: 1) sewer can go bad= anywhere from 10K-30K 2) roof 10K 3) electrical 10K 4) some reno on the inside 10K Or do you have another method? I am stuck on how to calculate cap-ex on old (100 year old) homes. Thank you!

Thank you so much, you guys! I really appreciate your help!

@Mary Jay investing should never feel like gambling, and in the case of old buildings you just have to think through which systems are end of life. As long as there is not water penetration, your framing, foundation, plaster, floors, and wood work tend to hold up pretty much forever. The main systems to think about are plumbing/sewer, electrical, tuck pointing/siding, roof, and basement drainage issues. If a building has been well cared for, I would rather have a 100 year old building than a newly built one made out of the card board they use now days!

First I try to do as many preventative upgrades as possible/practical during the acquisition. We have a lot of really old rowhomes in Philly. The capex items can be costly but not as much as your estimates, for example: New flat roof runs 2-5k depending on size. Mansard shingles cost more. New furnaces/boilers about 4-6k, a bit more if adding central a/c coils. New sewer lines 6k. But yes try and run numbers as conservatively as possible up front, and then upgrade the oldest items that are on their last legs first.

Thank you! How do you figure out if this old building will put you in a huge negative or huge positive? I feel like with old buildings its a gamble

@Mary Jay I think a lot of this strategy revolves around knowing the building stock in your area extremely well. For instance, I just purchased a 19 unit building in Berwyn, IL, and I am in the middle of rehabbing it. The building is from 1931, so the plumbing is all galvanized. Most of the plumbing needs to be changed as it is end of life. The plaster walls, ceilings, trim, doors, etc are all fine. I just keep patching and painting like you would drywall. Electrical was a complete change. I think the bigger challenge with buildings of this age is figuring out what the previous owners have done, and what they have done wrong. Maybe they ran electric that isn't code, or maybe they did shoddy plumbing repairs. Lean on trusted contractors to steer you in the right direction.