Once you get better at estimating costs, you will be able to estimate things such as: roof, kitchen, bathroom, flooring, painting rooms, doors, windows, etc. 

Really I like it because it’s been remodeled inside, new roof two years ago.

Despite a very good townhome, it was rented out with badly stained carpets, damaged kitchen vinyl flooring and appliances from the 70's..... the roof literally fell on our previous tenants and it was like pulling teeth to get him to pay a DECENT roof repair.I recognize he's pretty lucky to get it rented out at all now, let alone 15% above market value.

What happens if you have a roof that needs replacement or a tree that needs to be cut down?

I have purchased several deals where the house was just a shell and had to rehab everything from plumbing to electrical to roof , etc. it's a massive headache and extremely time consuming.

After the inspection it comes out that despite the structure being sound, HVAC electrical plumbing and roof are pretty old and may need attention soon.

Anastasia re-read this topic and others.Some TK providers say ( newly rehabbed )or as you say (rent-ready).If you have a property for 40k as it's total value and  it's needs a new roof for 4,000 that is 10% of the worth of the property.

I have been researching to see how much it would cost to rehab the house but I am sure the roof, electrical and panels will need to be redone.

As far as reserves, I've got a pretty good cash cushion built up, plus a line of credit in case of a dire emergency.While I haven't exactly budgeted for CapEx, my initial plan was to set all of the cash flow aside in a separate checking account to build up toward replacing the roof, separating the electric and hot water, etc.

Rents are through the roof 2/1s are going for $950 per month in decent C areas, and much high in A and B multi family properties.Let me know if I can help