Capex on 6 unit apartment building

[William Chrisman]

I'm going to view my first multi-family, a 6 unit apartment building on Monday.  I'm trying to run numbers this weekend.  What things, and/percentages should I consider for cap-ex.  (I only have one rental property so I'm fairly new to investing in general) The more info the better.  I would rather consider too many things than not enough.

[Eric Bilderback]

I use 5%.  Then keep 6 months worth of expenses for reserves, and make sure it can cashflow if market rents dropped 20%.  I am guilty of not following that criteria but I do strive for it.   But if you are buying a brand new building you probably won't have any capex.  My stuff is all 70s-80s and I think 5% is about right for cap ex and another 5% for general repairs.

Good luck!