Heating optionS to prevent high turnover - philadelphia, pa
Investor · Philadelphia, PA · Member since 2016 · 34 posts · 4 votes
I have a duplex in West Philadelphia's University City area. The property is all electric, no gas. I am having a challenge with one of my units. It is about 1500 sqft, 3stories, 3br, 2ba and being heated by an electric forced air furnace.
I lived in the unit for 5 yrs. And although the heating bills could be high, they were manageable (never had one more than $500) I kept budget billing which averaged the heat bill over a years time and I used utility choice after Peco got rid of its residential heating rates.
Now that I've moved out and put tenants in the unit, they are getting VERY high heating bills upwards of $900 per month. They cannot afford it of course. I'm trying to figure out the best way to manage this.
Should I add a gas line and put in a gas furnace? Change to baseboard? Put the heat on a separate meter and pay for/control it myself? Any other thoughts? Although the heat is not my responsibility, it's causing a major challenge in retaining tenants.
Disclaimer: I am not an HVAC professional, and I am very new to being a landlord.
In the short term, education may help. I have seen other landlords here post that if it's too hot inside, some tenants will open the window instead of turning down the furnace. Yes, even in the winter time.
Since you already have air ducts in the house, I'd tend to agree with your gas furnace idea. If you know that there is already a gas main in that street, it shouldn't be too expensive to get a line to the house and a meter. If it's an existing house that you're converting from electric heat, sometimes the gas company covers part of the cost of putting the line in from the street to the house.
If there isn't a gas main on that street, but there is one on the corner or otherwise nearby, it might be a little more expensive. If that is the case, talk to the owners of adjacent properties about splitting the cost of running the main down the street - they may be ready to cut down their electric bills, too.
For the gas furnace itself, you can get them in different efficiency levels - how much of the gas they turn into useful heat in the house. Right now, the cheapest kind you can buy are 80% efficient. The next step up is about 90%, and they go all the way up to about 97%. The more efficient ones cost more to buy, but are cheaper to run.
The 80% furnace will need a metal flue that goes outside. This is a piece of double-walled sheet metal pipe that is fairly large outside diameter, like 8" or so. It doesn't *have* to go straight up from the basement to the roof - it can go up, turn and run horizontally for a while, then turn and go up again - but finding a space for it in an existing house can be a challenge.
The 90% and up furnaces can be vented to the outside with PVC drain pipe. The pipe size depends on how big of a furnace you have and how many twists and turns are in the pipe, but usually, around a 3" pipe will do it. Sometimes it's easier to find a place to put a 3" PVC pipe than an 8" metal pipe. Often this pipe can go through the side wall of the house, rather than having to run all the way up to the roof. If it goes through the side wall, there are rules about how far away it has to be from doors, windows, etc.
The more efficient furnaces also need a fresh air pipe that comes from outside. This is the same size PVC pipe as the exhaust. It is often installed next to the exhaust pipe, but I don't think this is a requirement... if the furnace is in the basement, you can do things like have the fresh air pipe come in through the basement wall, and have the exhaust pipe go up through the house and out of the roof.
If you have a big, open, basement, some installers will skip the fresh air pipe and just let the furnace draw air from inside the basement. My personal feeling is that this is a bad idea, and in some places it might be prohibited by the building code. PVC pipe is pretty cheap and easy to install.
A 90% and up furnace will also need a drain line for the *furnace* - they pull enough heat out of the exhaust that the water vapor condenses out and doesn't go up the flue. This isn't a very big deal... if the furnace is in the basement, it's usually something like a 3/4" PVC pipe running to a floor drain in the basement. It doesn't have to be plumbed in like a sink; the end of the pipe from the furnace just sits on top of the floor drain and water drips out of the pipe into the drain. If you also have central air conditioning, the furnace installer can plumb the inside air conditioner drain (A-coil drain) and the furnace drain into the same pipe.
Sometimes there are federal, state, or local rebates or tax credits for adding insulation. Your electric or gas utility will probably know about them, as will people that install insulation. Sometimes adding insulation will let you use the next smaller size gas furnace, which helps offset some of the cost of the insulation.
Unless you know the wiring in the house is tip-top, I don't know if I would go with space heaters as a fix. They pull a *lot* of juice and are good at finding bad connections inside the wall. People are also not good at keeping blankets, curtains, etc off of them.
I hope this helps!
You should look into converting to gas. PECO also gives great cash rebates when you convert from electric.
Thanks Roberto
@Crystal DundasWell, luckily that part of the year is coming to an end soon.
This may not be a permanent fix, but you could advise they pick up a few small space heaters (or buy them yourself). That way they are not constantly heating the whole house. Decent brands like Holmes or Lasko can be picked up for under $50/unit on Amazon. I keep one in my bedroom and turn the house thermostat down substantially at night.
Since it seems like their bill is MUCH higher than yours was when you lived there, make sure they are turning the thermostat down when they're at work & at night. If you don't have a programmable thermostat, that sounds like it would be a worthwhile investment in this case.
Another option would be to bring in a company to give the property a home energy audit. They could point out all places you could seal, insulate or upgrade to increase its energy efficiency.
Regardless of which route you go, I would at least bring in a local HVAC expert to give you a full set of recommendations.
Disclaimer: I am not an HVAC professional, and I am very new to being a landlord.
In the short term, education may help. I have seen other landlords here post that if it's too hot inside, some tenants will open the window instead of turning down the furnace. Yes, even in the winter time.
Since you already have air ducts in the house, I'd tend to agree with your gas furnace idea. If you know that there is already a gas main in that street, it shouldn't be too expensive to get a line to the house and a meter. If it's an existing house that you're converting from electric heat, sometimes the gas company covers part of the cost of putting the line in from the street to the house.
If there isn't a gas main on that street, but there is one on the corner or otherwise nearby, it might be a little more expensive. If that is the case, talk to the owners of adjacent properties about splitting the cost of running the main down the street - they may be ready to cut down their electric bills, too.
For the gas furnace itself, you can get them in different efficiency levels - how much of the gas they turn into useful heat in the house. Right now, the cheapest kind you can buy are 80% efficient. The next step up is about 90%, and they go all the way up to about 97%. The more efficient ones cost more to buy, but are cheaper to run.
The 80% furnace will need a metal flue that goes outside. This is a piece of double-walled sheet metal pipe that is fairly large outside diameter, like 8" or so. It doesn't *have* to go straight up from the basement to the roof - it can go up, turn and run horizontally for a while, then turn and go up again - but finding a space for it in an existing house can be a challenge.
The 90% and up furnaces can be vented to the outside with PVC drain pipe. The pipe size depends on how big of a furnace you have and how many twists and turns are in the pipe, but usually, around a 3" pipe will do it. Sometimes it's easier to find a place to put a 3" PVC pipe than an 8" metal pipe. Often this pipe can go through the side wall of the house, rather than having to run all the way up to the roof. If it goes through the side wall, there are rules about how far away it has to be from doors, windows, etc.
The more efficient furnaces also need a fresh air pipe that comes from outside. This is the same size PVC pipe as the exhaust. It is often installed next to the exhaust pipe, but I don't think this is a requirement... if the furnace is in the basement, you can do things like have the fresh air pipe come in through the basement wall, and have the exhaust pipe go up through the house and out of the roof.
If you have a big, open, basement, some installers will skip the fresh air pipe and just let the furnace draw air from inside the basement. My personal feeling is that this is a bad idea, and in some places it might be prohibited by the building code. PVC pipe is pretty cheap and easy to install.
A 90% and up furnace will also need a drain line for the *furnace* - they pull enough heat out of the exhaust that the water vapor condenses out and doesn't go up the flue. This isn't a very big deal... if the furnace is in the basement, it's usually something like a 3/4" PVC pipe running to a floor drain in the basement. It doesn't have to be plumbed in like a sink; the end of the pipe from the furnace just sits on top of the floor drain and water drips out of the pipe into the drain. If you also have central air conditioning, the furnace installer can plumb the inside air conditioner drain (A-coil drain) and the furnace drain into the same pipe.
Sometimes there are federal, state, or local rebates or tax credits for adding insulation. Your electric or gas utility will probably know about them, as will people that install insulation. Sometimes adding insulation will let you use the next smaller size gas furnace, which helps offset some of the cost of the insulation.
Unless you know the wiring in the house is tip-top, I don't know if I would go with space heaters as a fix. They pull a *lot* of juice and are good at finding bad connections inside the wall. People are also not good at keeping blankets, curtains, etc off of them.
I hope this helps!
'Thanks folks. I tried the education route, and they still ended up ignoring my warnings. Sounds like the best permanent fix would be look into a gas line. I know the house had one previously so it might not be too much to convert back to gas. Thanks guys.
If you convert to gas you're going to want to get a heater and a meter for each unit IF it's a multifamily, or you can't charge them for the gas
there is an electric heater in the other unit. Are you saying one unit can't be electric and one gas?
Do both units have to have gas? Why can't I heat one with electric and the other with gas.
I've looked into the solar option. Apparently there is no tax credit for rentals.
@Crystal DundasHave you considered a heat pump? I have it in a few of my rentals, and the heating bills are quite reasonable.
The 90% + efficiency gas furnace sounds like a good solution. Or the heat pump (but since you have ducts already, that limits the options). A HVAC professional can advise.
Definitely get an energy audit and look into insulating the place better. No matter what fuel you use, you're not going to want to send the heat outside, which is what you're probably doing now. We are eligible for all kinds of rebates on insulation if we improve the insulation (and reduce heating costs) by at least 15%.
Do both units have to have gas?
I don't think there is anything to stop you from having electric heat in one unit and gas in the other.
The only thing I can think of is that if you have gas heat anywhere in the property, you might want to put CO detectors in *both* units. The building code or rental property code might require this; your friendly local building inspector or code department can advise.
If you think you might eventually run gas to both units, you should tell the gas company that when they install the meter for the first unit. They can put in a manifold for two meters, install one meter, and just plug the extra hole in the manifold. Later on, when you install the gas pipe inside the second unit, they can come out again and hang the meter faster, without having to shut off the existing meter.
If both units have ductwork installed already, it might be worth asking the HVAC company if you can get a better deal by buying two furnaces at once. For sure they won't object to installing two furnaces on the same day, or installing two furnaces one day apart. You *might* be able to get them to bite on you paying for two furnaces and one installation now, getting one furnace installed now, and then paying for the second installation in a month or two and getting the other furnace installed then, if that helps your cash flow or budget.
@Crystal Dundasbaseboard heating option wouldn't be a bad option, put a separate thermostat in each room. that way the tenant only needs the heat on in the unit they occupy at the time. also consider winterizing the windows where cold air could be leaking in. i recently did both in a duplex of mine. electric heating generally is more expensive but if the tenants use the heat source wisely it can be cheaper. i occupy one floor of my duplex and electric had been cheaper than gas for me.
Do both units have to have gas? Why can't I heat one with electric and the other with gas.
You could do that. You still need separate meters for each unit though
thanks for all of the helpful feedback folks. This was my first post to bp and super useful!
The first duplex I bought in upstate ny had electric baseboard. Not knowing any better I thought it would be a great heating system since it was clean and low maintenance! Polar vortex hits and tenants were complaining about high heating bill ($500 per month). I ended up putting in a gas furnace and ductwork to the whole house since it was a good tenant and a good property. If you already have ductwork in place it shouldn't be too expensive, most importantly lower turnovers!
Thank you Henry!
before you incur a major capital expenditure for no reason, are these the first tenants that have lived in this unit besides you since you purchased?
Maybe they are just irresponsible with the heat and do not know how to use it correctly? That could be an issue here as well.
This is why I never tell tenants what the past heating costs were in a unit when they ask. Let them call the utility company and ask. Saves you the "you told me" comments later when they get the high electric bills.
This is the second set of tenants I've had the issue with. I know there is a level of irresponsibility for both sets. But either way, having lived there, I know the electric forced air can be expensive if you're irresponsible. And I don't want to deal with the turn over or the challenges paying rent because of the $700 heating bills. Just trying to improve the property to make keeping it rented easier.
First you have to educate them that they are not getting a $500 heating bill. Thier average electric bill is $150 and during heating months it is $350 to add heat to that for a total of $500. They cannot compare it to their neighbors gas only bill. Is the unit a mirror of the other side ? If so it may be more expensive but if the neighbors can keep the mirror image unit within manageable costs they are the issue. $900 is high last time I had this happen come to find out the bill was for 2 months not one like they thought. The other issue occurred when the last month was estimated and this was not. These were both students. I got thermostats that max at 70 so you can't "accidently" put at 85 but that was where I was paying for heat. If you have the opportunity to convert to gas for a reasonable cost I would install for both and change over when the next door unit is vacant. not sure I would want to switch an occupied unit. Improving the building envelopewill help so you might want to get an energy audit from the power company
It all depends on how much you want to spend. 90% will be the easiest to install due to flue issue. If you need a new ac.. Look at going with a heat pump as this will provide heat in winter based an temp. These options will cost a little more.
Force Air heating is VERY inefficient in conducting heat, especially long distances from the heat source. Circulating hot water is much more efficient.
Get an HVAC licensed contractor to show you the details. Then get a fixed price quote for baseboard heaters. While living in Connecticut, the house used BB and an oil fired boiler which wasn't too bad. There's two components there
both can be optimized independently.
Here in Calif, our HVAC has dual zone controls and programmable thermostats to reduce both heat and ac costs.
First you have to educate them that they are not getting a $500 heating bill. Thier average electric bill is $150 and during heating months it is $350 to add heat to that for a total of $500. They cannot compare it to their neighbors gas only bill. Is the unit a mirror of the other side ? If so it may be more expensive but if the neighbors can keep the mirror image unit within manageable costs they are the issue. $900 is high last time I had this happen come to find out the bill was for 2 months not one like they thought. The other issue occurred when the last month was estimated and this was not. These were both students. I got thermostats that max at 70 so you can't "accidently" put at 85 but that was where I was paying for heat. If you have the opportunity to convert to gas for a reasonable cost I would install for both and change over when the next door unit is vacant. not sure I would want to switch an occupied unit. Improving the building envelopewill help so you might want to get an energy audit from the power company
While I agree with you about educating tenants and the fact they don't realize they're paying for household electric use plus heat, how long/often do you (or the OP) want to swim against the current on this? There is a stigma with electric heat, at least in Philadelphia, as it's one of the first questions I get asked is does the unit have gas or electric heat. If it's contributing to a smaller/less desirable tenant pool or to higher turnover, it's worth changing, especially since she already has ductwork.