How Much Liquid Cash Should I Keep Available?

[Tim Porsche]

Hi All,

I have a quick question I'd appreciate your input on, especially if you already own numerous multi-family properties yourself. I currently have two rentals with good cash flow, one a single family and one a duplex I'll be moving into in the near future. My goal is within 3-5 years to own 3 or 4 triplexes or quads with about 20%-30% equity in each (don't want to over leverage). My question is, assuming each property is in good overall condition and solid, no major capex expenses are on the horizon like a new roof for instance, how much should I be keeping in liquid cash for large unexpected repairs to these properties? Also assume these properties are worth about $180,000 each. I know there are many variables, and maybe no single correct answer, but I'm just looking for a rough ballpark figure here. Is $20,000 a good number? Too high, too low? Thanks in advance for any input you can give. 

[Jeff Kehl]

I use two different rules for cash reserves. 

6 months x monthly debt service, insurance and taxes = x

4% x gross value of real estate portfolio = y

x and y for me work out to roughly the same amount. I keep that amount in liquid or close to liquid funds.