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Updated almost 3 years ago,

User Stats

8
Posts
2
Votes
Lucas Musil
Pro Member
  • Investor
  • Wisconsin
2
Votes |
8
Posts

Maintenance and Capital Expenditures costs?

Lucas Musil
Pro Member
  • Investor
  • Wisconsin
Posted

I am trying to understand the best way to figure out the most accurate way of calculating costs of maintenance and capital expenditures.  I am thinking it could be 2% for one and 15% for another by seeing what condition the property is in, when things were replaced last, tenant you have in there, ect.  The area I am investing in has a median household income of $95,000 and an above average median credit rating.  I will also be more strict about the tenant screening process and will require 1 month rent as a deposit (figure $2000 for an easy number).  Tenant will be responsible for lawn mowing and snow removal, ALL utilities including garbage.  I also have many connections with plumbers, electricians, landscaping crews, painters, carpenters, flooring guys, drywallers, ect.  I am trying to paint a picture so that when answering this question it could be relative to my situation.  I understand its never a perfect situation, things always go wrong or not as planned.  However, I would like to see the range of profit each potential investment property has and take that in to consideration when analyzing the deal. 

Example below:

Home Facts: 2000 Sq. Ft. 3 Bed 1.5 Bath and Finished lower level with detached 2 car garage, home is on half acre with city sewer and water, built in the 1980s.

Location: SE Wisconsin

- Roof replaced in 2010 

- Water heater replaced in 2020

- Windows/Siding replaced in 2007

- A/C and Furnace replaced in 2022

- New flooring in the house 2022

- Concrete driveway 

The example above I feel like $2200 a year would suffice for Capex and maintenance, I understand it can very based on what kind of tenant you have. Let's say you got a good tenant that is a bit handy and takes it upon them selves to do some little stuff that the landlord should handle.

On the other hand, if the example above was different and the last time everything was replaced was 2000 what would you plan to put aside for Capex? Say your tenant doesn't destroy the place but you have above average maintenance costs what would you set aside for maintenance costs then?

Thanks for any advice or recommendations you may have. 

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