How much does Window Unit A/C hurt your rental prices?

[Steve Balinski]

Hello everyone, there is a duplex in the NorthWest Chicago suburbs that I'm very interested in, listed for 250K, rents total for about 2500-2600/month combined for both units.  Its a complete remodel (don't know about electrical/plumbing yet), building is 100 yrs old.

My only concern is it doesn't have central A/C, would have to get window units.  How much does this effect the $$$ monthly rent you can charge and hurt finding tenants?  Its a "C-class" neighborhood, average home price is probably around 250K, older smaller town.  

[Danny Polanski]

The answer to this question with a vague location is simple. 

Check your local listings. 

[John Warren]

@Steve Balinski almost none of my buildings have central AC. Under $1300-1400 per month, it really isn't expected. I also don't think it is something you need to provide in a C class area as your tenants will take care of this themselves with window units. 

[Kevin Coleman]

I agree with @John Warren. I am from the south and grew up in a home my parents purchased new. Pretty much everyone I knew had central AC. It was not until I moved to Chicago in 2012 that I realized window units were not as uncommon as I once thought. While it will certainly help to have window AC units, if it is not the norm in the neighborhood at said pricepoint then it maybe just fine. I will say that $250k seems low to me but I may be biased by City of Chicago prices. 

My units do not have central AC. I purchase one large(minimum 10k btu) window AC unit for the living and advertise that I will put it up and taken it down once a year. Tenants seem to like that.

[JD Martin]

I'm in Tennessee. It would be a deal killer here but it's hot down here too. Over the years I've been doing this expectations have also changed. My first rentals tenants were thrilled to learn I had CHA. Now tenants specifically ask me if the old wall heaters have been disconnected in some of our homes as they expect virtually anything to have CHA. However, I generally am renting B properties so that does make a difference, but even C tenants expect to get AC down here. In Chicago, it may not be as pervasive. I spent one summer in Chicago (Great Lakes, actually) when I was in the Navy and I thought it was hot and miserable (our barracks had no AC). 

[Paul De Luca]

I agree with @John Warren. Depends on where the property is but all else being equal in terms of finishes/amenities in a unit I don't think central AC vs window AC will have much of a difference in terms of rent.

[Bruce Woodruff]

Is there a possibility of adding a mini-split system? I know, more expensive...but definitely a step up in comfort and looks. Just a thought....

I don't think window units would ruin your deal, I'd rather have window units than no cooling ability at all, that's for sure...

[Scott Mac]

Drive the surrounding blocks and note if (a lot) of the properties have window units.

If so, it might be norm for the area.

Also talk to 2 or 3 top selling Realtors (in that area) and get their take on the value add of central A/C and how common it is in that area.

Not to say you can't be the only one offering a central Air unit in that area, just go in with enough information to make a reasonable decision.

Window A/C comes in many different AMPS, if renter A brings too big of an amp draw for the circuit it must plug into he will blow fuses or breakers all the time.

If you own the window units, you can have a dedicated circuit run that matches the AMP load of the A/C, in which case using a sleeve unit makes sense (they are a little different than window A/C), because it does not block the view, and you can mount it up high and let the cold air fall, or mount it down low out of the way.

The downside to window and sleeve units is some renters will steal them and then claim to not have stolen them, so you have to ding their security deposit for it.

And like @Bruce Woodruff said, there is the minisplit option. This is a good choice especially for a non-forced air heating system.

But as for putting in a central A/C unit, if you already have a Nat Gas furnace, the duct work is already there, all you have to worry about is some degenerate steeling the coolant and breathing it to get "Far Out".

I mention that because the newer type coolants (required by law) are very expensive to replace.

Good Luck!

[John Morgan]

@Steve Balinski

I’d put in central air with that kind of rent you’ll be getting. Nobody wants to live with window units unless rent is super cheap.

[John Warren]

@Bruce Woodruff and @Scott Mac you have to be careful with mini splits in Chicago since the temperature can get below the operating minimum for these systems to heat.... maybe if you are using it as a supplemental heater it would be ok? I did some basic research into these a few years ago and decided to take a pass. We had a really fun stretch this year where the temps were below zero for about a week. 

[Jennie Berger]

Quote from @John Warren:

@Bruce Woodruff and @Scott Mac you have to be careful with mini splits in Chicago since the temperature can get below the operating minimum for these systems to heat.... maybe if you are using it as a supplemental heater it would be ok? I did some basic research into these a few years ago and decided to take a pass. We had a really fun stretch this year where the temps were below zero for about a week. 

@John Warren This is SO good to know! I was considering installing these in a 3-unit building I'm trying to buy--as a way to avoid duct work, dropped ceilings and/or soffits--but I didn't know this tidbit. Now I'm looking for other options to get the boiler, radiators, and window a/c units out... Any other advice? :)

Thanks for sharing!

[Jaron Walling]

We have only purchased properties with central air. In our market lots of window units go hand-in-hand with cars parked in the yard. I start thinking C-/D class. That's just a localized investor opinion. 

[John Warren]

@Jennie Berger depending on the size of the units, I have personally had a lot of success with all electric. I have done electric baseboard, and even a through the wall unit in the past. I don't need to provide AC for our units, but if you do in smaller units where a through the wall slot exists this can be more economical. 

[Jennie Berger]

Quote from @John Warren:

@Jennie Berger depending on the size of the units, I have personally had a lot of success with all electric. I have done electric baseboard, and even a through the wall unit in the past. I don't need to provide AC for our units, but if you do in smaller units where a through the wall slot exists this can be more economical. 

 Ah ok. I would need to provide AC in my units for sure. Thank you for your feedback!

[Kevin Coleman]

I have a heat pump/mini split for my 2 unit. It produces heat down to -13F and works well for my home. The city required supplemental heat in case it gets below that so I have a hardwired wall heater as a backup that looks like a small HVAC return.

There are quite a few factors to consider with the minisplit system, specifically for a multi unit(new build and older building). I am more than happy to share if anyone is interested. 

[Richard F.]

Aloha,

You really need to also consider the cost of operation for the Tenant. There is a wide variation in efficiency from one brand/model to another. If window units are over/under sized, the operational cost will be further affected. You need an experienced installer to look at the options for running ducting for central units, which will be significantly more efficient than window units...but also need to be properly sized.

Whether window, split, or central, plan on specific periodic maintenance/cleaning to keep them operating at their best, and prevent breakdowns in the worst part of the season.

A final consideration regarding window units, you need to ensure they are properly and securely installed and condensate drains are routed away from the structure. Improper or no drainage system can result in condensate penetrating your window sill/trim and/or leaking to the interior of your structure ultimately causing extensive wood rot and other water related damages. They also should not be allowed to drain onto a sidewalk or other walking surface creating a slipping hazard; or be located in a hazardous location that can cause injury to unsuspecting pedestrians, such as protruding low over a walkway.

[John Warren]

@Steve Balinski I am curious now. Did you move forward with the duplex or no? 

[Elbert O.]

Quote from @Kevin Coleman:

There are quite a few factors to consider with the minisplit system, specifically for a multi unit(new build and older building). I am more than happy to share if anyone is interested. 

Would love to hear.  I have a minisplit in my primary residence and while it's been great, it has required a decent amount of maintenance over the years, and this is with my family keeping it in great condition.  Am currently in contract on a 4 unit multifamily and the units currently have wall units.

[Kevin Coleman]

@Elbert O. I just sent my thoughts to you DM.