Including refrigerator - personal property? maintenance?

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Including refrigerator - personal property? maintenance?

Jason CunninghamPro Member
Real Estate Agent · Laguna Beach, CA · Member since 2015 · 9 posts · 0 votes

Hello all,

I have a question about including a refrigerator (and washer + dryers for that matter) in our rentals.  Currently we have 4 rentals, all include refrigerators.  As the fridge is technically personal property (ours are not built in or attached to the property) should the landlord be responsible for maintenance and repairs on them?  Are the extended warranties a good idea?  Currently we are just going thru the manufacturer's web sites and ordering the repairs thru them without any extended warranties.

Thank you for your time!

-Jason

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Russell BrazilBusiness Member
Moderator
Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
9y

In addition to the way your lease is written....also look to what is customary in your market place. In my market, and most of the northeast, appliances are de facto the responsibility of the landlord

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  • Account Closed
    Investor · Henderson, NC · Member since 2016 · 484 posts · 208 votes
    9y

    It depends on how your lease is written. The fact that they are not built in is not relevant. A lease can be written such that the tenant is responsible for all maintenance, and replacement if necessary. If your lease doesn't say that, then it's probably you who gets to pay.

    When they rented the unit they took it in as is condition. If the fridge was there and working at the time, then you must continue providing it unless your lease says otherwise.

    1Reply
  • Russell BrazilBusiness Member
    Moderator
    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    9y

    In addition to the way your lease is written....also look to what is customary in your market place. In my market, and most of the northeast, appliances are de facto the responsibility of the landlord

    [email protected]301-893-4635Podcast Guest on Show #192
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  • Scott Weaner
    Rental Property Investor · Yardley, PA · Member since 2008 · 1k+ posts · 561 votes
    9y

    I include a clause in the lease that states the appliances are included as a courtesy, and the tenant is responsible for maintenance. Has worked so far.

    2Reply
  • Gail K.
    Augusta, GA · Member since 2014 · 1k+ posts · 1k+ votes
    9y

    A fair number of landlords will add a clause in the lease similar to what Scott has.  Some may exclude the stove and refrigerator in this but add any washer and dryer as a "courtesy" appliance.  This is especially true if there is a concern that the tenant may have friends/relatives that they will invite in to use the washer/dryer freely for their own use.

    Gail

    2Reply
  • Mindy JensenPro Member
    BiggerPockets Money Podcast Host · Longmont, CO · Member since 2014 · 7k+ posts · 10k+ votes
    9y

    @Gail K. , that's a great point. It never occured to me that they may allow friends to come wash their clothes - but that happened to my husband and I when we were younger and had our own place - people asked if they could do laundry at our place more than once.

    @Jason Cunningham , I would personally not rent a property without a refrigerator - they are difficult to install and the damage possibilities are not worth not providing one. However, I would never have one with an automatic ice maker in it - that's the first thing to break. 

    Check out the local market to see what is being offered in comparable rentals and go from there.

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  • Jeff B.
    Buy & Hold Owner · Redlands, CA · Member since 2015 · 5k+ posts · 2k+ votes
    9y

    The street were my 6-plex is located is all small (4-6) MFUs - - some rent with stoves and refrigerators and some do not.

    I provide them as a marketing edge against those that do not.  They are on the move-in checklist but I don't bother with notations in the lease re maintenance.  They get damaged far sooner than any maintenance issues - - when's the last time you had a service call on yours at home?  Yes, before anyone comments on it, if/when they're damaged it's deducted from the deposit.

    Washer/Dryers?  I provide hookups, but no appliances.  It's 50/50 that the tenant will have or acquire them - - singles seldomly do, families almost always.

    1Reply
  • Jeff B.
    Buy & Hold Owner · Redlands, CA · Member since 2015 · 5k+ posts · 2k+ votes
    9y
    Originally posted by @Account Closed:

    @Jeff B. If the landlord provides stoves and refrigerators, the landlord needs to fix it if anything goes wrong and not burden the tenant with the repairs. It will cost you more in court if the tenant sues for deducting from the deposit.

     WOW.  I've been doing this for 19yrs - - don't you thing I know this by now.  Apparently you didn't understand that I've never had a maintenance call because units get replaced when damaged.

    I'll take your comment under advisement. 

    1Reply
  • Bill Gulley
    Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
    9y

    John is correct and if you depreciate your appliances for taxes as you should be, not making repairs or paying costs then you're filing a false tax return. Now, if you have a commercial tenant they have lease-hold improvements they can account for such matters, but not residential tenants. 

    Doesn't really matter what the fad of the day is locally, talk to the IRS!  :)

    1Reply
  • Rich N.Pro Member
    Investor · Haverhill, MA · Member since 2015 · 761 posts · 328 votes
    9y

    I've always been under the impression that if the landlord provides it, they cover it.

    It doesn't matter what I state in the lease as a convenience or the tenant is responsible.

    I live in liberal Massachusetts, a very tenant friendly state !

    Also, its pretty standard around my neck of the woods to provide a fridge.  Over some 20 years of doing this, I think only one perspective tenant had their own fridge.

    1Reply
  • Carin Kveton
    Investor · Lake Villa, IL · Member since 2013 · 29 posts · 9 votes
    9y

    Because we had to rehab the properties we kept as rentals, they all have new appliances, with the exception of one unit.  I think they should be included, because, like someone else pointed out, you could have damage to the floors, etc, with install/removal. However, we may start adding in the "courtesy clause" and have the tenants be responsible for repairs, especially as the appliances get older. 

    0Reply
  • Michael Bertsch
    Bossier City, LA · Member since 2015 · 122 posts · 50 votes
    9y
    If the fridge needs replacing, just buy a new one. You can deduct 50% with bonus depreciation the first year.
    0Reply
  • Account Closed
    Investor · Henderson, NC · Member since 2016 · 484 posts · 208 votes
    9y
    Originally posted by @Account Closed:

    @Jeff B. If the landlord provides stoves and refrigerators, the landlord needs to fix it if anything goes wrong and not burden the tenant with the repairs. It will cost you more in court if the tenant sues for deducting from the deposit.

     Totally wrong, as usual. It depends on the wording in the lease. There are no laws that require a landlord to provide a working stove or refrigerator, unless that was agreed upon in the lease. 

    0Reply
  • Account Closed
    Investor · Henderson, NC · Member since 2016 · 484 posts · 208 votes
    9y
    Originally posted by @Account Closed:

    @Ryan R. Get your facts straight. I said if the landlord provides a stove and refrigerator the landlord needs to be the one to fix it if something goes wrong not the tenant. Good luck if the tenant sues you.

     I had my facts correct the first time. Just because you provide a stove and refrigerator does not mean you are required to maintain and/or replace those items. It depends what the lease says, there is no law.

    Once again, your posts are almost always incorrect - this is another fact I got right the first time. Ever notice how your ratio of votes to posts is much lower than most other people? 

    Furthermore, a tenant is not going to sue you about a refrigerator. They are usually too stupid to figure out the legal system and then they realize it cost more than a refrigerator to actually sue somebody. And then they would lose...

    1Reply
  • Account Closed
    Investor · Henderson, NC · Member since 2016 · 484 posts · 208 votes
    9y
    Originally posted by @Account Closed:

    Your votes are very low. Why do you hide your profile?

     39% of my posts have been voted on. Only 18% of your posts get voted on. You think that might be because you frequently post a bunch of complete nonsense that is usually off topic? It's certainly not because people think your posts have better content than mine...

    Oh, yeah, I'm also the third top contributor to this section. How come your name isn't up on that list? 

    I don't hide my profile, I just don't fill it out. Why would I share personal information online with a bunch of whack jobs like you around to read it?

    1Reply
  • Chris MasonPro Member
    Moderator
    Lender · CA · Member since 2015 · 9k+ posts · 10k+ votes
    9y

    Hi @Ryan R. and @John Anderson,

    Guys, be nice please. :)

    Anywho, back on topic, there is a minority opinion that I find interesting. I don't know that I agree with it, but I find it interesting. The theory/argument/opinion goes as such:

    • I want high quality tenants. 
    • If they are required to purchase their own fridge/washer/drier and use professional installers/movers to put it in (put professional installation in the lease), this guarantees a tenant that is not living month to month, and that they will want to be here a while.
    • This automatically weeds out many people that are more likely to be problem tenants. 
    • This also yields tenants more interested in eventually owning a home ("well, we will need to buy a fridge in 3 years anyways, once our down payment is saved... may as well get it out of the way"), meaning they have plans to move out in 2-3 years, thus auto-solving my problems with rent control. I want them to want to be here a while, but not forever, because of rent control. 
    • I may lose $100/month because I didn't include fridges, but consider the cost of just a single eviction, and it's worth it to substantively reduce the odds of dealing with that.

    Kind of an interesting minority opinion, eh?

    2Reply
  • Rich N.Pro Member
    Investor · Haverhill, MA · Member since 2015 · 761 posts · 328 votes
    9y

    @Chris Mason

    I think it really depends more on what the composition of your tenants and what other landlords offer.

    Example, I have a couple of different long term tenants and each of them are made up of working professionals but they are not family.  So, none of them will have a fridge

    0Reply
  • Chris Latham
    Investor · Eastvale, CA · Member since 2015 · 38 posts · 17 votes
    9y

    I really like the ideas about putting in a clause or addendum about the appliances that states that they are the tenants responsibility.  But I would caution to make sure you check it out with your state's rental laws.  Also be aware of unintended consequences.  If the tenant is responsible for repairs what happens if the appliance is beyond repair?  Who pays for that if it came with the unit? You would think (and the tenants will ! ) that the landlord should be responsible.  If that's the case then it's cheaper for the tenant to destroy rather than repair.

    Always, as @Russell Brazil suggested, look at other rentals in your area and see what is customary.  We do not include refrigerators with our rentals in the California desert.  So much so, that if we buy another SFR with a frig then we sell off the frig before a tenant moves in.   On the other hand, in the Boise Idaho area refrigerators are expected. 

    Russell Brazil

    0Reply
  • Jeff B.
    Buy & Hold Owner · Redlands, CA · Member since 2015 · 5k+ posts · 2k+ votes
    9y
    Originally posted by @Bill Gulley:

    John is correct and if you depreciate your appliances for taxes as you should be, not making repairs or paying costs then you're filing a false tax return.

     I don't repair the refrigerators because they don't need repairs, not a question of refusing to repair.  I get about five years out the appliance before dumb tenants buy a another out of their deposits.  As for taxes, their well done by my CPA and as his license is at stake with every filling, I'll continue to listen to him.

    0Reply
  • Bill Gulley
    Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
    9y
    Originally posted by @Jeff B.:
    Originally posted by @Bill Gulley:

    John is correct and if you depreciate your appliances for taxes as you should be, not making repairs or paying costs then you're filing a false tax return.

     I don't repair the refrigerators because they don't need repairs, not a question of refusing to repair.  I get about five years out the appliance before dumb tenants buy a another out of their deposits.  As for taxes, their well done by my CPA and as his license is at stake with every filling, I'll continue to listen to him.

     Absolutely listen to your CPA and for that reason, just make sure you give him all the correct data, he's not responsible unless you give him the proper information, like personal property placed in service for you business concerns.

    So, when the fridge blows after years of service with prior tenants, you sting the current tenant for the cost of a new one? That's a new one on me, but if that is customary in your area and the tenant understands they have to buy a new one from deposits, hmmmm? 

    They must be really dumb tenants. :)

    0Reply
  • Jeff B.
    Buy & Hold Owner · Redlands, CA · Member since 2015 · 5k+ posts · 2k+ votes
    9y
    Originally posted by @Bill Gulley:
    Originally posted by @Jeff B.:
    Originally posted by @Bill Gulley:

    John is correct and if you depreciate your appliances for taxes as you should be, not making repairs or paying costs then you're filing a false tax return.

     I don't repair the refrigerators because they don't need repairs, not a question of refusing to repair.  I get about five years out the appliance before dumb tenants buy a another out of their deposits.  As for taxes, their well done by my CPA and as his license is at stake with every filling, I'll continue to listen to him.

     Absolutely listen to your CPA and for that reason, just make sure you give him all the correct data, he's not responsible unless you give him the proper information, like personal property placed in service for you business concerns.

    So, when the fridge blows after years of service with prior tenants, you sting the current tenant for the cost of a new one? That's a new one on me, but if that is customary in your area and the tenant understands they have to buy a new one from deposits, hmmmm? 

    They must be really dumb tenants. :)

     DAMAGES FELLA;  I seldom have any idea where you're coming from most of the time and sure glad I didn't take your classes.  I've refrained for a while but you force me to say this:

    Those that can DO, those that can't only teach and preach. 

    It's sad to see you picking fights with other here.

    I promise not to read/respond to you any further.

    1Reply
  • Deanna McCormick
    Minneapolis, MN · Member since 2013 · 2k+ posts · 1k+ votes
    9y

    Refrigerators and stoves I provide, I don't want someone moving them in and out. I choose average type of appliance and don't permit ice makers. but I don't have high end units.

    I replace as needed, if they need fixing I don't usually mess with it unless I can trouble shoot and figure out the problem, I get new delivered and they take the old.  I don't want to be left moving out their crap when they leave and don't take it with. My units show better with appliances and less drawback for my tenants to think about.

    You may find warranties are not available for rental properties with some manufacturers.

    0Reply
  • Jim KennedyPro Member
    Accountant · Cherry Hill, NJ · Member since 2016 · 173 posts · 201 votes
    9y

    I am a CPA, a buy and hold investor (for 12 years), and I worked at the IRS for several years as well. Our lease (which has been tested in court and prevailed) states that the tenant can use the washer and dryer and the use of it is included in the rent. We also state that the tenant is responsible for any repairs on it. (This keeps them from overloading it basically) If it needs to be replaced we will do so unless there is evidence of abuse. 

    One type of abuse is letting friends and family use it. That is a lease violation, because the only people allowed to use this are the people who are paying rent (remember the rent includes use of the appliance), and their names are (hopefully) on the lease. Proving it is pretty easy. Just look at the water usage on the water bills! If you look on the IRS webpage, it shows you can audit a laundromat by measuring the water usage. Match it agsinst siilar units you have...it will jump out at you pretty fast.

    Furthermore, we train our clients to work with our model. We tell them to allow 45 minutes to review and sign the lease when they move in. Both LL and Tenant initial the bottom of every page, and we explain every single term of the lease, so there is no confusion as to what is acceptable and what is not. 

    Dont know if you are old enough to remember the 1960's cartoon TopCat, where he has a coin on a string he re-uses, but we had a tenant who tried that on a coin op washer. WHen it broke, he paid for the repairs, and then we removed it from the building. Not as punishment, but as a safety precaution! Think about it...he messes witih it, it jams, breaks, overflows, it leaks thru to the 1st floor, floor gives way, and on and on.

    Last, I own the appliance and so I depreciate it. Letting the tenant pay for repairs in no way invalidates my return. The expenditure is consistent with IRC section 162. 

    Jim Kennedy CPA

    1Reply
  • Karl B.
    Rental Property Investor · Erie, PA · Member since 2015 · 1k+ posts · 2k+ votes
    9y

    When I moved back to Los Angeles in 2011 me and two dudes rented a three-bedroom in Fox Hills. There was a stove but the owner (she went by the name 'Miss Rentee' as her sister was a famous singer in the 1960s or 1970s and the two sisters invested in real estate and crushed it) told us in all of her properties the tenant had to get their own fridge. She claimed it was due to sanitary issues. And this woman and her sister owned large apartment buildings. The rent was quite fair ($1900 for a three-bedroom in a nice area near the park) and although it was an inconvenience we had no problem in doing so as the rent and area were too good to pass up. 

    0Reply
  • Matt Geerts
    Investor · St. Thomas, Ontario · Member since 2015 · 692 posts · 312 votes
    9y

    I personally provide a fridge. If it needs repair I go on the local classified and put another used one in its place. New shelves from the mfg would have cost me >$150 with shipping. A "new" fridge cost me $90, and it was a larger, nicer, newer one than I had before. The tenants were thrilled.

    My issue was that I bought the house and somehow overlooked the fact that the fridge was missing a shelf and drawers.

    I have never in my life seen a fridge need repair. My parents house used the same one for thirty years, my student house had a used one that never broke, my personal house uses a hand-me-down one that has never broken. I feel like providing a used fridge for 90 bucks is a low-risk high-reward (rapport) easy no-brainer purchase.

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