Central A/C or window units in Baltimore - cost/benefit?

Question

I just bought my first rental property near Johns Hopkins in Baltimore - a nice 3bed/2bath about 1500 square feet.  The house has forced air heat, but no cooling.  I'm debating putting in A/C but I'm guessing to run the additional duct-work for cooling returns and to hook everything up, I'm going to be looking at about $8-10K (i have two estimates coming back later this week).  Assuming that's close to the right numbers (and if you think i'm crazy, please say so), have other investors in Baltimore found central A/C to be a key feature, and provide a return on investment in cashflow and/or resale worth the upfront cost?  I haven't listed it for rent until I get some other work done, so I'm trying to get a sense of whether this investment in time/money is going to help enough to justify it.  Thanks for any advice!

Jassem A. · Answer

Some tenants may actually prefer window units because it lets them cool the areas that they want cooled and they are less expense over time especially in areas where theft is common.

Ned Carey · Answer

@Ethan Sonnichsen My preference is to have very nice upgraded units with central AC and we have even stated putting granite in for counter tops. However we also have some we added AC to existing forced air heat and some with just window units.

You are right window units are common in Baltimore. Section 8 pays extra for AC even if it is just window units.

Part of my decision is what is the expectation of the market in that specific area. Also is it a nice enough area that central air will add to the value. Some rental areas have no retail  homeowner market and the extra expense of AC may not add much value over time.

Chris Purcell · Answer

Hi Ethan, I have a duplex in Butcher's hill with window AC. I don't think window AC is getting me any less rent than having central air. I have window units in the living/kitchen area and each bedroom.

However I will admit window units are a pain in the rear but to me it's worth it to deal with window AC rather than the huge expense to install central AC.

Jeff Kehl · Answer

@Ethan Sonnichsen I think I may be less knowledgeable than you about this but I'm curious if you already have forced air heat why do you need more duct-work for a/c?

All brand new Heating and A/C for a house that size would cost $3-5k for me if there was no need for new duct work. Even if you needed some new duct-work for cooling returns I don't think it would add more than $1k for the hvac guy. Probably the extra is drywall and paint. Watch youtube and do that part yourself!

If it's more than median rent for the area (which a 3 br/2ba will always be) you have to have central a/c.

Anthony Gayden · Answer

3 bedroom 2 bath 1500 square foot house, and you would even consider a window unit as okay???

Sorry, but central air is a key feature everywhere. It isn't 1920. I don't care how cheap the house was.

M Marie M. · Answer

Depends on how much you're renting it for.

I'm planning on ductless a/c for my Baltimore rehab rental because the place is so friggin small (it's a tiny house) there is no room for a regular hvac system. I plan to rent it for an amount that will cover the expense.

I have another property in Florida and it only has the forced air heating system. The rent doesn't justify splurging for a/c. Since I don't pay for electricity, I'm okay with my tenants providing their own window units.

Chris Collins · Answer

@Ethan Sonnichsen The ductwork problem is an interesting issue that we see frequently here in Cleveland.  I would not add the AC unless return is added upstairs as it will be 5+ degrees warmer and the tenants wont understand why (id imagine you would get calls saying the air isnt working upstairs, when in fact it is).

Im sorry to say, but you wont get a price of 5K to do all of that work, and if you do, run.  Installing a condenser (outdoor unit), indoor coil and lineset, as well as the electrical service needed outside, will probably run you 5k.

I dont know your market, but if central air isnt a common feature, then I would forgo adding it.  I allow tenants to provide their own window units for my properties.

Ethan Sonnichsen · Answer

Thanks all for the advice.  It seems window units are not that uncommon in baltimore rentals from what I've seen.  That said, I want to provide a nice unit and differentiate from some of the others.  To respond to Jeff, the extra cost is because I need to install the A/c compressor/fan outside (all I have is furnace right now) and a cooling system needs returns up high to pull the warm air into the system for cooling.  Right now, the only return is on the main floor because for heating, it will pull the cooler air on the lower levels and the warm air rises up to where the bedroom are.  Yes, you can just add cooling to the existing ductwork, but it will never cool upstairs where all 3 bedrooms are without a return pulling that warm air from upstairs back down to the a/c system.  Hopefully they come back and says it's only 5K for all the work (including drywall and paint and electrician hookup).  If so, I'm inclined to bite the bullet.

Central A/C or window units in Baltimore - cost/benefit?

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