Time wise there is not a significant pay back on efficiency. If tenants are paying utilities their is no direct pay back for the landlord. It is simply part of your maintenance costs. I would install the furnace that I could get the best deal on based on anticipated longevity not efficiency. I would shop for the deal. Bottom line being my out of pocket expense not the efficiency of the furnace.
Developer · Kansas City, KS · Member since 2015 · 84 posts · 9 votes
10y
Katrina, are you paying for utilities? Could you raise the rent or would you be able to market the units better if you had a higher efficiency furnace installed?
Real Estate Agent · Nashville, TN · Member since 2015 · 2k+ posts · 2k+ votes
10y
It depends on the sqft of the property.
I would say don't get the LEAST efficient model. Remember if your tenants are paying very high utility bills due to inefficient furnaces, it will put a strain on their ability to pay rent. My advice would be to get something mid-range.
Time wise there is not a significant pay back on efficiency. If tenants are paying utilities their is no direct pay back for the landlord. It is simply part of your maintenance costs. I would install the furnace that I could get the best deal on based on anticipated longevity not efficiency. I would shop for the deal. Bottom line being my out of pocket expense not the efficiency of the furnace.
HVAC Tech · Fort Wayne, IN · Member since 2015 · 423 posts · 223 votes
10y
What sq ft is house. Is it natural gas? What % is current furnace. Your best bet is to install same as current as long as your running on natural gas. If you go from 80% to 90s% or vice versa different piping is used and your install price goes up. Installing a 80% furnace, natural gas is not doing your tenant an injustice as cheap as natural gas is, especially the smaller the house is.
Rental Property Investor · Winslow, ME · Member since 2008 · 826 posts · 281 votes
10y
This is just my "style" but I'd get as good as I can get without being ridiculous. And what I mean is to get a boiler that is good enough to be attractive if you sell the house. Don't put something that is going to be a "sore point" if you decide to sell. Then again don't get the latest, greatest thing that's going to be the equivalent of putting an inground pool in a neighborhood that doesn't have any pools. Hope that ramble makes sense...but I would very strongly advise that if there's more than a 5% chance you'll be selling it within 5 years, put a really good, efficient boiler in. A "side effect" is that you can often charge a little more rent next tenant because you know it only uses 400 gallons of oil each year vs. the 550 it used to use.
Investor · Randallstown, MD · Member since 2010 · 185 posts · 57 votes
10y
I appreciate all the input guys. But no one is telling me what you put in YOUR rentals? Was just hoping people could tell me what you use when you have to replace furnace.
Investor · White House, TN · Member since 2016 · 33 posts · 7 votes
10y
I would put in 80% that is the minimum and its probably going to be higher efficiency then what you have now. If you go to a 90% or more you would have to change flue piping and that would cost more in labor and for the equipment.
Investor · Hyattsville, MD · Member since 2012 · 822 posts · 441 votes
10y
I put 80% furnaces in my units and upgrade to programmable digital thermostats if they are not already in place. Those get me the lowest installed cost vs. 95% furnaces and most tenants wouldn't know the difference. Tenants won't see super high gas bills vs. a 95% unit. I'd go with 80% unit, especially if the furnace you are replacing is likely already an 80% and it should be a straight swap with no additional vents needed that a 95% will require. The utility companies usually offer some rebates on the high efficiency ones but they still are more expensive installed AFTER rebates making 80% the best bet. Also, shop around and get a couple of quotes as HVAC installation prices vary wildly since they all use different brands and models.
Investor · Randallstown, MD · Member since 2010 · 185 posts · 57 votes
10y
Thanks so much everyone. Shopped around, and ended up choosing a 95%er because after rebates, it was only about $120 more than the 80%. Thanks so much for all the input.
Rental Property Investor · Sioux Falls, SD · Member since 2015 · 9k+ posts · 18k+ votes
10y
I always put the higher efficiency models in my homes that are 95% with direct venting. My HVAC guy won't even install 80% anymore. Why stick your tenants with huge gas bills? It benefits my tenant, but ultimately high utilities are a reason people move, so it benefits me to not have high utilities. I don't understand the mentality of "I am not paying the gas so who cares". Apparently, I maintain my properties at a higher quality than other landlords, but for something like a furnace that will be there 20 years, why would anyone want to go cheap? Good decision @Katrina P. on the high efficiency!
Investor · El Paso/Socorro, TX · Member since 2012 · 365 posts · 75 votes
10y
Agreed. High efficiency for a reasonable cost is not a waste of money to me. Also you may be able to take most of the cost as a one time tax deduction. I actually have 99% efficient vent-less gas heaters in several of my homes even with the main furnace simply because I would want them if I lived there. If you buy the one that looks a small wood stove, they even add value similar to a fireplace.
Contractor · Round Rock, TX · Member since 2013 · 767 posts · 389 votes
10y
Regional law and code will dictate what you install Above the mason dixon line is supposed to be 90% and above with 13 seer a/c. South is 80% with 14 seer
Investor · Thorp, WI · Member since 2015 · 15 posts · 4 votes
10y
My dad runs an HVAC company so I'm biased but I would go with the 90% efficiency. If I buy a house that already has an 80% furnace I'll leave it in until the furnace needs to be replaced, but then take that opportunity to upgrade it.
If you go with a high efficiency furnace, don't let them trick you into buying anything fancy. The multi-stage furnaces use extremely expensive circuit boards and fans so repair costs will be high. Get a high efficiency model but go with the low-end of that spectrum.
Wholesaler · West Bloomfield, MI · Member since 2015 · 2 posts · 1 vote
10y
Seer: Is the efficiency of the A/C. The bottom end is about 13, and the top best efficiency is about 26. Of course the top end is super costly being 3500 to 7000.00 and not worth it in my opinion(depending on size of the house.)
Investor · Fremont, CA · Member since 2015 · 19 posts · 3 votes
10y
Today's 80% is better than the one you are replacing (which most likely is very old, and originally at 60-70 to begin with, worsened over time). So my tenants typically see lower energy bills with a new 80% eff furnace. (My philosophy is similar to Greg S above...)
Architect · Papillion, NE · Member since 2015 · 1k+ posts · 840 votes
10y
Good choice on the system. Avoid 80% efficiency systems unless you go up in seer ratings but this would not make economical sense for a rental. I would a programmable thermostat to the house. Honeywell has a nice one at the $200 price range. Its super easy to use, filter reminders, and phone apps. Ive heard good things about the nest thermostat too.
Real Estate Investor · Baltimore, MD · Member since 2011 · 2 posts · 1 vote
10y
Hello. This is what we do. Normally we replace with a like furnace except if there is a flue pipe issue. A old crumbling chimney will need repair / relined in order to allow the flue gases to escape the house safely. In those cases we then go to a 95% furnace which allows us to run the flue gases out of a easy to install PVC line, thus eliminating the need for use of the chimney