Hellow guys, Welcome to my website, and you are watching Real Estate Basics Explained: Capital Expenditures aka CapEx (3 Minutes or Less). and this vIdeo is uploaded by Succeed REI at 2021-06-02T14:59:46-07:00. We are pramote this video only for entertainment and educational perpose only. So, I hop you like our website.
| Name | Real Estate Basics Explained: Capital Expenditures aka CapEx (3 Minutes or Less) |
| Video Uploader | Video From Succeed REI |
| Upload Date | This Video Uploaded At 02-06-2021 21:59:46 |
| Video Discription | 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/sample-rental-application Watch the video here: https://youtu.be/zevuffnyyRc 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: https://youtu.be/rNRq9BBOXuY Best platform for finding off-market real estate deals (PropStream.com): https://trial.propstreampro.com/succeedrei/ - 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: https://youtu.be/ua3zjhrvgzs -------------------------------------- My attorney profile and contact information: https://www.woh.com/attorneys/79/vitaliy-volpov/ My blog: http://www.succeedrei.com My real estate brokerage: https://www.serenityrealestate518.com/ Facebook pages: https://www.facebook.com/SucceedREI/ https://www.facebook.com/serenity518/ ---------------------------------------- The complete video on How to Analyze Rental Properties: https://youtu.be/s7Cymlr9p30 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 |
| Category | Education |
| Tags | capital expenditures real estate | cap ex real estate | capital expenditures rental properties | cap ex rental properties | cap ex rentals | real estate basics explained | real estate basics | real estate basics for beginners | real estate basic knowledge | real estate basics 101 | real estate basics for dummies | how to estimate cap ex | how to calculate capital expenditures | how to estimate cap ex real estate | how to estimate cap ex rentals | succeed rei | vitaliy volpov |
