CapEx, Maintenance, Vacancy, and Misc Question
BP - this may be be a dumb question, but it is something I have been debating for a couple weeks now.
i actually just closed on my first property and have benefited more from this website and the tools, people, and information gained in order to make my first deal a reality.
By no means was it a home run $50k profit flip, a SFH that cash flows at $550 or anything like that, but it is a SFH that cash flows after all expenses (very conservative expenses) of around $176 per month +/- $25 depending on which assumptions I tweak slightly
That being said - after taking out significant portions of $ and setting them aside for CapEx, Maintenance, Vacancy, and a MISC category (and of course PITI and property management) all of which are running through my model, do you guys actually keep the money aside in a slush fund or separate account or is it for modeling purposes to understand that you still cash flow after all these major and foreseeable future expenses. I am currently in the mode where i want to scale up quickly and having the extra cash flow per month would make it easier and quicker to acquire my next property while still knowing that in XX amount of years i will have to replace a water heater and there will be maintenance come end of the year when tenants turn over. Hypothetically could i use the money from my monthly savings, and cash flow from my property to scale and because it is already modeled in use a CC or cash on hand at the time of the maintenance or CapEx or is this a bad strategy
Thanks