Dallas-Fort Worth Real Estate Investor Club

Repair allocation for rental property

  • 14 May 2021 2:42 PM
    Message # 10504440

    Does any one has experience with cost allocation for a rental property.

    I am trying to figure out what would be a good repair cost allocation for a rental home that was built after 2010.

    Is the amount of $150 per month enough?



  • 14 May 2021 3:20 PM
    Reply # 10504604 on 10504440

    It depends on the current condition is systems and finishes in the house. At the very least, plan on replacing carpet and appliances every 5 years, water heaters in 5-8 years and if HVAC is original, plan on replacing in 10 years. Divide those replacement costs by the expected useful life ( in months) an that will. Serve as a starting point for building a reserve fund. Alternatively, set the total amount aside now, and plan on $100-150 per month for the minor repairs and service calls. If your tenant is going to be responsible for minor maintenance like drain clogs and hvac servicing, $100 per month might be a good number. 

  • 15 May 2021 12:37 AM
    Reply # 10505787 on 10504440

    Thanks Terry for the detail explanation.  

  • 15 May 2021 7:07 AM
    Reply # 10507422 on 10504440


    You may look into implementing a Home Warranty which will cover your electric items such as stove, HVAC, refrigerator, dishwasher, refrigerator, built in microwave, etc.  You can also do an add-on for pool pumps and well pumps.  Some companies will give you a discount for multiple properties.  These warranties can really keep your repair/replacement costs down.

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