Install A/C and reinstall furnace in my rental (Denver metro)

9 Replies

I purchased a 6bd/3.5ba home ($450k) in March, put $55k in reno, and I'm house hacking with two roommates. I'm looking to cash out refi next year.

I have a 12 year old furnace with ducting. With the summer season ramping up, 2nd floor is getting upwards of high 80's and I got some quotes for A/C. 

One company quoted me $4800 for A/C only and $6800 for A/C and furnace. That's only $2000 more for the furnace, which seems like a good deal. Upgrading from a single speed, low efficient blower to a variable speed blower also sounds like it will put less load on the system which may also increase the life of my electrical system. Another benefit is that with the new efficient blower, I can recirculate air by just having the fan on without using the A/C to cool down the house.

Question1: Should I even consider investing in an A/C to make tenants happy and raise the value of the home for refi (double benefits)?

Question2: If I do choose to get an A/C, should I also replace my 12 year old furnace (life of a furnace is 15 I believe) to take advantage of the combo deal and to get a heard start before my furnace dies?

Jesse, 2k for the new furnace can be a good deal, depends on the efficiency and other bells and whistles.  The whole amount seems high to me, mainly because its retail pricing most likely.  12 years on a furnace is still REALLY young, honestly inspectors say 15 years but a well maintained furnace can easily go 25 with no issues.  I'm thrilled when I buy houses with 10-15 year old furnaces, we can get them cleaned/serviced/certified and feel good about selling that property to a new owner.  Your main benefit to getting the furnace will be the re circulation/blower feature, which could earn you back that 2k in saved utility bills over a few years.

Originally posted by @Anson Young :

Jesse, 2k for the new furnace can be a good deal, depends on the efficiency and other bells and whistles.  The whole amount seems high to me, mainly because its retail pricing most likely.  12 years on a furnace is still REALLY young, honestly inspectors say 15 years but a well maintained furnace can easily go 25 with no issues.  I'm thrilled when I buy houses with 10-15 year old furnaces, we can get them cleaned/serviced/certified and feel good about selling that property to a new owner.  Your main benefit to getting the furnace will be the re circulation/blower feature, which could earn you back that 2k in saved utility bills over a few years.

Thank you for the reply. I got three quotes. $3000 for Goodman AC (lower quality A/C and service provider), $4800 for American standard (high quality A/C), $6800 for American standard A/C and Furnace (same company as $4800), and $7450 Rheem A/C only. Seems like $6800 is a good deal and I am getting more quotes. The furnace was inspected when I purchased the house and it's fine. I'm looking for advice from experienced homeowners out there to learn if it's worth upgrading for the bundle price. 


I am sharing utilities with the tenants (electricity, trash, water, sewer, etc). Even when I leave this home and rent it out, I would like to have tenants pay for utilities. Is this common in Denver area?

Can't say I'm familiar with HVAC prices in Denver but I don't think the age of your current unit warrants that kind of investment.  Is the property 80 degrees with the unit running full?  Did you ask them to quote out a replacement or just to take a look and let you know why the property is not cooling correctly?  Did they verify you have enough refrigerant and that there are no leaks in the system?  It could be anything from the unit not being the correct tonage, the property using flexible ducting that limits air flow, partially covered vents, is the property not insulated correctly, or even a fan issue.  Sometimes even a duct cleaning can make a huge difference in airflow which only runs a few hundred dollars.  

HVAC is a pain and can be difficult unless you know it intimately yourself or have a vendor you can trust.  Just make sure to consider all your options before throwing around that kind of cash.

@Jesse Park spending money unnecessarily is not getting a good deal. One of our rentals has a 35 year old furnace that’s going strong, and we also have several others 20-25 years old. Conjuring up the old adage “if it ain’t broke, don’t fix it”, I wound not replace a furnace unless I had to personally. I would look for a less expensive way to solve the problem such as adding window, portable, through-the-wall, or mini-split AC unit in the area you’re having trouble keeping cool, if possible.

Originally posted by @Michael Peters :

Can't say I'm familiar with HVAC prices in Denver but I don't think the age of your current unit warrants that kind of investment.  Is the property 80 degrees with the unit running full?  Did you ask them to quote out a replacement or just to take a look and let you know why the property is not cooling correctly?  Did they verify you have enough refrigerant and that there are no leaks in the system?  It could be anything from the unit not being the correct tonage, the property using flexible ducting that limits air flow, partially covered vents, is the property not insulated correctly, or even a fan issue.  Sometimes even a duct cleaning can make a huge difference in airflow which only runs a few hundred dollars.  

HVAC is a pain and can be difficult unless you know it intimately yourself or have a vendor you can trust.  Just make sure to consider all your options before throwing around that kind of cash.

I currently don’t have an A/C

 

Originally posted by @Steve K. :

@Jesse Park spending money unnecessarily is not getting a good deal. One of our rentals has a 35 year old furnace that’s going strong, and we also have several others 20-25 years old. Conjuring up the old adage “if it ain’t broke, don’t fix it”, I wound not replace a furnace unless I had to personally. I would look for a less expensive way to solve the problem such as adding window, portable, through-the-wall, or mini-split AC unit in the area you’re having trouble keeping cool, if possible.

This is the kind of advice I was looking for. I’ll see if I can hook up a line on my furnace to get the fan running on my thermostat and forget about spending $5k on AC and replacing the furnace. 

 

Two Words: Swamp Cooler. We have an aerocool with an upgraded motor. We have to run it in spurts because it gets too cold. After the sun goes down, we shut it off for the night. These units are about the same as AC, but they cost significantly less to run. Plus Xcel gave us a $1200 rebate.

What is nice is that you can leave your back patio door open and not worry about the "cold air" getting out. 

as a plumber and heating contractor, I wouldnt even offer to just change just the evaporator on a unit that's 12 years old. Wouldnt stamp my name on it, why? Because when the furnace has a breakdown the next winter or 2 it looks bad and people assume that it's under warranty since they just did the ac.

It's not that much harder to change the furnace while you have supply side all undone. It would be different if the furnace was newer or there was a severe hardship preventing it from being changed. 

Also the old "if it ain't broken dont fix it" quote is not a good catch phrase for a buy and hold investor. Idk bout you, but I want my places to be as little of headache as possible and if that includes preventive maintenance so be it. I don't want to get calls at 1am saying that the heat isnt working.

I definitely would not do the furnace based on its age. 

Is there any reason you can't just do window units for the AC? I would only consider central AC if either A. all of my competitors have or B. I am going to be living there for a long time and I want to be comfortable.