Capex & RepairsRate will make or break this deal - advice please

[Charlie Anne]

Hello,

I'm trying to buy my first rental property and I'm not sure if I am using the right Capex & Repairs rate.

I have seen estimates that range from 10% to 30%.

The house I'm interested in purchasing is a 3 bedroom 2 bathroom SFH. The purchase price would be $118k with $12k of repairs for a total of $130k. The ARV would be $160-170k.

The house was built in 1979, so it is an older house. I used a Capex & Repairs rate of 15%. At this rate the deal works. But if it should be 20-30% then it's no longer a deal. However there is $30-40k in instant equity which I'm not sure how to account for.

What do you think? Should CapEx & Repairs be higher? Does anyone have ranch SFHs from the late 1970s? I'm curious what rates you use. The location is in Georgia.

[Charlie Anne]

@Tchaka Owen possibly! I have an estimate of $8-10k for repairs but I threw an extra $2k on there for surprises. Thanks for the feedback!