Capital Expenditures (CapEx) Estimation in Los Angeles

[Andrew Karpman]

Hello All,

Ever since I had realized that the 10% rule for CapEx estimation is not always a good estimate, I've done my own estimations as to how much money should be allocated for CapEx in the Los Angeles metropolitan area.

In the CapEx calculations, I had accounted for the following: Roof, Water Heater, All Appliances, Driveway, HVAC, Flooring, Plumbing, Windows, Paint, Cabinets/Counters, Gutters, Structure/Foundation, Landscaping, and Components (garage door, etc).

Please refer to the questions below:

1. My total monthly Capital Expenditures came out to be about $280/month. Does this seem about right for Los Angeles?

2. Initially, according to my research and people's comments, the roof replacement would cost on average about $10K. I reached out to a local roofing contractor (Supreme Remodeling Inc.) and got a quote that was $15-25K for Asphalt Shingle and $25K and up for Tile for a 1,450 sq.ft SFH. Therefore, in my calculations for CapEx, I ended up using $15K for roofing. Does this price seem right for a property of the size mentioned above?

3. Some CapEx items such as the Driveway or Windows I am planning on not accounting for when analyzing properties that were built in the year 2000 or later. Does this practice seem OK since both the driveway/parking lot or windows are all items with long lifespans (I assumed 50 years for both)?

Thank you for your responses in advance.

Andrew