Capital Expenditure (CapEx) Reserves Calculator
CapEx reserves cover big-ticket replacements: roof, HVAC, water heater, appliances, flooring. New investors skip these and look profitable on paper — until year 7 when the AC dies. Calculate proper monthly reserve.
| Roof monthly reserve | — |
| HVAC monthly reserve | — |
| Water heater monthly reserve | — |
| Appliances monthly reserve | — |
| Flooring monthly reserve | — |
| Total monthly CapEx reserve | — |
| % of monthly rent | — |
Capital Expenditure (CapEx) reserves cover big-ticket replacements — roof, HVAC, water heater, appliances, flooring — that hit your rental property every 8-25 years. They're not 'expenses' (those are repairs); they're scheduled replacements. New investors skip CapEx in cash flow analysis and look profitable on paper — until year 7 when the AC dies and wipes out 18 months of cash flow.
How to Calculate Per-System Reserve
Formula: Replacement Cost / (Remaining Life × 12) = monthly reserve. Example: $12K roof with 20 years remaining life = $12,000 / 240 = $50/month reserve. Do this for each major system. Add them up. That's your total monthly CapEx reserve to set aside. Most landlords keep CapEx reserves in a separate bank account so they don't accidentally spend them.
Typical CapEx as % of Rent
5-10% of rent for newer/well-maintained SFR. 10-15% for 30+ year-old homes. 15-20% for fixer-uppers and pre-1970 stock. The BiggerPockets rule of thumb is 5-10% CapEx + 5-10% repairs (separate budgets — repairs are unexpected breaks under $500, CapEx is scheduled replacements above $500). Add 8-12% vacancy + 8-10% property management on top to get true cash flow.
Last updated May 2026. Sources: BiggerPockets CapEx Guide.