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David Lund
  • Columbia, MO
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hold 3-5 years before upgrading—do I still consider CapEx?

David Lund
  • Columbia, MO
Posted Dec 31 2022, 12:14

Should I still consider CapEx for a SFH (had it at about $150/month) for monthly cash flow if I only plan to hold a property for 3-5 years? Long term vision is to consolidate properties into a large multi family.


Any and all advice is appreciated! 

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Chris Seveney#3 All Forums Contributor
  • Investor
  • Northern Virginia
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Chris Seveney#3 All Forums Contributor
  • Investor
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Replied Dec 31 2022, 12:28

@David Lund

Yes. You also should count property management fees as well even if you don’t use one. It gives you accurate pricing

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Chris Davidson
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  • Boise, ID
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Chris Davidson
  • Real Estate Agent
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Replied Dec 31 2022, 12:50

@David Lund yes count for it but also know in your strategy you will likely have excess funds if everything goes as planned. If everything doesn't then you have some funds to cover it.

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Christen G.
  • Rental Property Investor
  • Seattle, WA
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Christen G.
  • Rental Property Investor
  • Seattle, WA
Replied Dec 31 2022, 12:53

Yes for sure - can't hurt in this current climate and it'll be there when you need it in 3-5 years.

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Nathan Gesner
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Nathan Gesner
  • Real Estate Broker
  • Cody, WY
ModeratorReplied Jan 1 2023, 05:16
Quote from @David Lund:

Yes!

Include capex and PM into your calculations. If you need it, you have it. If you don't need it, then you can use the extra money towards the next investment.


  • Property Manager Wyoming (#12599)

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David Lund
  • Columbia, MO
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David Lund
  • Columbia, MO
Replied Jan 1 2023, 09:04
Quote from @Chris Davidson:

@David Lund yes count for it but also know in your strategy you will likely have excess funds if everything goes as planned. If everything doesn't then you have some funds to cover it.

Great advice! Thanks 

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David Lund
  • Columbia, MO
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David Lund
  • Columbia, MO
Replied Jan 1 2023, 09:05
Quote from @Nathan Gesner:
Quote from @David Lund:

Yes!

Include capex and PM into your calculations. If you need it, you have it. If you don't need it, then you can use the extra money towards the next investment.



 Great! Thank you 

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Henry Lazerow
  • Real Estate Agent
  • Chicago, IL
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Henry Lazerow
  • Real Estate Agent
  • Chicago, IL
Replied Jan 1 2023, 09:09

Yes, but maybe do less $100 a month, etc. There is still is stuff like clogged toilets, random leaks, etc. that happen even outside of long term cap/ex items.

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Drew Sygit#2 Managing Your Property Contributor
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Drew Sygit#2 Managing Your Property Contributor
  • Property Manager
  • Birmingham, MI
Replied Jan 5 2023, 18:12

how will you know when to sell?