Real Estate Basics Explained: Capital Expenditures aka CapEx (3 Minutes or Less) скачать в хорошем качестве

Real Estate Basics Explained: Capital Expenditures aka CapEx (3 Minutes or Less)

This video provides a quick overview of what capital expenditures are and why they are so important for your rental property calculations. DISCLAIMER: please note that the information contained in this video is for educational and entertainment purposes only. You should always consult your own attorney and your own financial and tax advisors before making any legal or financial decisions. This video is not intended to and does not create any attorney-client relationship between the content creator and the viewer. The views and opinions expressed in this video belong solely to the creator and do not reflect those of his law firm or any of his business partners. -------------------------------- Affiliate Links and Free Giveaways: My free sample rental application: https://mailchi.mp/3050a8472b29/sampl... Watch the video here:    • Include THIS in Your Rental Applications |...   My favorite tenant screening service (RentPrep.com): http://bit.ly/RentPrepAffiliate sign up for a free account have your applicants pay for tenant screening directly to the site no more need to collect application fees Watch my review and tutorial here:    • How to Screen Tenants in 2021 | RentPrep.c...   Best platform for finding off-market real estate deals (PropStream.com): https://trial.propstreampro.com/succe... sign up for a free 7-day trial to test it out! tons of features for finding and marketing to motivated sellers and cash buyers Watch my review and tutorial here:    • Видео   -------------------------------------- My attorney profile and contact information: https://www.woh.com/attorneys/79/vita... My blog: http://www.succeedrei.com My real estate brokerage: https://www.serenityrealestate518.com/ Facebook pages:   / succeedrei     / serenity518   ---------------------------------------- The complete video on How to Analyze Rental Properties:    • How to Analyze Rental Properties - Concept...   Capital Expenditures (Cap Ex): this category confuses a lot of people and a lot of novice investors do not account for it at all. This is a big mistake. Capital expenditures are expenditures for replacement of mechanicals and building components (i.e. roofs, furnaces, hot water tanks, appliances, flooring, doors, windows, etc.) when those components have reached the ends of their useful lives. Most investors think that because they accounted for repairs, that they covered themselves for these expenses. Most of the time, they have grossly underestimated the cost of replacing these items. The fact of the matter is that every single component of a building from large to small has a finite life and, if the property is to continue to function, every component will at some point need to be replaced and that replacement will cost the owner money. Capital Expenditures Example: Let’s say you buy 6-unit property with a roof that is 10 years old. Because of the size of the building, a new roof is going to cost $25,000. Let’s also assume that this roof will need to be replaced in 15 years. In order to properly account for this future cost, and ensure that the property (rather than your personal finances) pay for it, you should factor the cost into your monthly expenses for the building. To do that, we would take $25,000 and divide it by 15 years and then divide it again by 12 months. The resulting number is $138.89. This is the monthly Capital Expenditure cost for replacing this roof on this building. In order to calculate the total Cap Ex on a property, you would need to perform this analysis on virtually every component of a given building. Since doing this is difficult when you don’t have all of the necessary information about the particular components of the building, you can use an estimate for this cost metric as well. A lot of investors allocate 10% toward Cap Ex. However, again, this is just a generality and any relevant specific information about the subject property can change this estimate up or down. The older the building and the older its components, the higher the Cap Ex estimate should be. #CapitalExpenditures #CapEx #SucceedREI