Capex expenses

[Jean Paul Rousseau]

For buy and hold investors, to analyze your return, you have to take into account the capex expenses. I really don't know how to handle it.

In a recent post, Brandon Turner estimated that 182 $ per month have to be put aside for a typical SFH with a 1000 $ monthly rent. That represent a 18% cost which is pretty high and not sustainable in my case.

In another blog for a similar property he takes a 5% estimate for capex expenditure, which is not compatible with the first number at a first glance.

I understand that capex increase when the house get older. So if both those numbers are valid guidelines that means that you start with very few capex expense when the house is fully rehabilitated and you finish with more than 30% after 20 years, which seems not bearable.

The conclusion I make from those numbers is that the buy and hold long term strategy is not valid, it seems better to buy rehabilitated houses and sell them after 10 years.

Does I am wrong somewhere ? I will be glad to hear what more experimented members think of it.

Hope to hear from you.