Systems to include
What is a CapEx reserve for rental properties?
A capital expenditure (CapEx) reserve is money set aside each month to fund future equipment replacements — HVAC systems, water heaters, roofing, appliances, and other major systems with finite lifespans.
Most financial advisors recommend landlords reserve 5–10% of monthly rent per unit for CapEx. This calculator gives you a more precise number based on the actual equipment in your properties.
Why reserve matters
Without a reserve, a $12,000 roof replacement comes out of cash flow at the worst possible time — often when multiple units need work simultaneously.
Rule of thumb
Budget $1 per square foot per year, or 1–1.5% of property value. This calculator refines that estimate using actual equipment lifespans.
What to track
HVAC, water heaters, and roofs represent the largest CapEx costs. After those, appliances and electrical panels are the next biggest line items.