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Replacements and Refurbishments
Rust, Wear and Rot destroy over 14 different
building components, some several times, during a
building's (say 120 year) life.On today's costs, an average rental house will have around two
million dollars or $340 weekly spent on refurbishments and
replacements.
Deteriorating items include:-● Exterior walls and windows
(Replaced every 60 years or 3100 weeks)● Carpets, vinyl and curtains
(Replaced every 20 years or 1040 weeks)● Appliances and furniture
(Replaced every 15 years or 780 weeks)● Bathrooms
(Replaced every 30 years or 1560 weeks)● Kitchens
(Replaced every 30years or 1560 weeks)● Paint inside and out
(Replaced every 13 years or 676 weeks)● Roofs and spouting
(Replaced every 35 years or 1820 weeks)● Water pipes and drains
(Replaced every 65 years or 3380 weeks)● Fences, gates and sheds
(Replaced every 40 years or 2080 weeks)● Heating and ventilation systems
(Replaced every 15 years or 780 weeks)● Insulation
(Replaced every 40 years or 2080 weeks)● Electrical delivery systems
(Replaced every 65 years or 3380 weeks)● Floors & piles
(Replaced every 65 years or 3380 weeks)● Remaining building
(Replaced every 120 yrs or 6240 weeks)
To calculate the cost of replacements:-
1) Divide each component's cost by its life expectancy in
weeks
2) Add (decreasing) interest
Calculators provide combined repayments
3) Total the loan repayments on each item.See Rental property cash-flow calculator .
Also see ANZ Home mortgage calculator
Owners or banks finance these replacements:-
Rents repay the loan over the life of each deteriorating
component.
Example:-
A $5,500 heating / venting system lasts 15 years.
A 15 year mortgage loan purchases the system.
Over 15 years $11pw repays the loan.After 15 years the heating / venting system needs replacing again and a
new loan will be called for.
WWW.Rentagain.nz Cash-flow Calculator makes these calculations
Also see ANZ Home loan calculator