Capital Needs Inspections

Capital Needs Assessment

A Capital Needs Assessment is an inspection of the property to provide a cost estimate of maintaining a property over a 5 to 20 year time span. The assessment assist the property by setting up a budget for the projected amount of years and also informs of immediate needs on the property. By collecting data and inspecting the properties condition, the 'useful life' of items is determined.

The FANNIE MAE USEFUL LIFE TABLES were developed by Fannie Mae with the latest version dated August 17, 1992. They are intended to provide owners with an estimate of what funds will be required, based on average useful lives, for replacement of components. Placement of percentages will not always coincide with a straight deduction of average age from the anticipated useful life. There are several variables which must be taken into account, i.e., a property which does not sustain a well planned and practiced preventive maintenance schedule as discussed above may have components that will not last as long as the average life span. Conversely, if a property sustains a well planned and practiced preventive maintenance schedule components may be placed in the next higher range. Another factor which may affect placement of percentages in the following table is the condition of the component versus age at the time of inspection, i.e., a component showing more wear than should be present based on age may be an indication of improper installation or abuse.

Sample From the FANNIE MAE USEFUL LIFE TABLE