If there is no mortgage payment at present, escrow items are not added back in the above explanation.It's more nuanced than this and there are many exceptions/caveats, but this gives a high-level explanation. 

Owners are ok, not happy lol but ok with paying for items and issues, just want to understand what's going on. 

I would say about $8k average, sometimes reaching towards $20k depending on length of run and the difficulty of tie-in to the City main.I would not, as a buyer, wnat to take a chance on this..even if they are working well now, it is a ticking time bomb and a large expense.So I would wrap your head around the concept of offering a credit towards this item.

Myth: You never have to worry about getting your rent when you have section 8 tenants.Reality: rent payments can get suspended if the unit fails annual inspection, even if the items that caused it to fail are the tenants fault.Reality: the tenant portion of the rent is never guaranteed.Reality: if a tenant wants to leverage you for an upgrade, like a new stove or a new refrigerator, they can cause housing payments to get suspended by filing a complaint with their caseworker.

If you were able to use the standard TREC lease agreement, there are many items that protect the property/landlord in there. 

It is best to provide them with a checklist of items you are requesting.

The first line of item #1 of the note should be:Who is that.

On the residential side my experience has been that any cash flow I accumulate gets eaten by major “replacement” items every three years.  

Have you taken the previous inspection report and verified all the items are completed per the inspection report. 

My question is how much I should charge him for each of these items.