Adding estimates for capex to deal analysis

[Hector Sapinoso]

Hi BP,

I'm trying to refine my deal analysis skills, and had a question about capex. What are some of the big ticket capex or deferred maintenance items for a buy and hold SFR that I should build into my analysis? I can think of the roof and the water heater, but what are some other things I should be thinking about? Also, do you just figure out the estimated cost and then accrue it over the estimated useful life of the item?

[Emily S.]

@Hector Sapinoso, how do you plan to manage that money until it's used (hopefully a good, long time)? Are you keeping repairs and capex cash in a separate account to be used only for maintenace or replacing items? 

The recent podcast with Natalie Morris mentioned separate accounts for what seemed like just about everything. Just curious how you plan to manage that money that you set aside.