Expensive repair on rental. Should I do it?

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Expensive repair on rental. Should I do it?

Supada L.
New to Real Estate · Member since 2020 · 147 posts · 134 votes

Hello,

I have an out-of-state rental that I've relied on the property management to take care of it. I have owned the property for about a year and there has been minor fixes that already turned my first year cashflow negative.

Earlier this year the tenant has submitted a repair request for the drive way as shown in the pictures below. My PM got a quote for $5500 to repair it. Should I let them do it? Or is there a way to mitigate the cost? Any suggestions are welcome.

Thank you in advance,
Supada

The tenant complain: "Driveway pavement is coming up & it is tearing up the front end of my cars!"

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Steve Vaughan
Rental Property Investor · East Wenatchee, WA · Member since 2014 · 10k+ posts · 16k+ votes
5y
Originally posted by @Supada L.:

I have an out-of-state rental that I've relied on the property management to take care of it. I have owned the property for about a year and there has been minor fixes that already turned my first year cashflow negative.

This is the lesson here.  OOS managed rentals can't cash-flow when the Maytag Man needs to be called for every little thing.  Period.

OOS 'passive' rental ownership should be more of a wealth preservation strategy rather than accumulation needing cash-flow strategy.  There will always be minor fixes. 

Yep, definitely replace that driveway with concrete.  Need to think long-term👍

16Reply
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  • Charles Carillo
    Rental Property Investor · North Palm Beach, FL · Member since 2018 · 2k+ posts · 1k+ votes
    5y

    @Supada L.

    This is not just a problem for their car but a lawsuit ready to happen and if your insurance learns of this; they are not going to renew your policy unless this is rectified. However; you might not need to replace the whole driveway; get other bids on just replacing part of it but the correct way of doing it is to redo the whole thing. Did you see this when you purchased the property?

    15Reply
  • Account Closed
    Rental Property Investor · Indianapolis, IN · Member since 2020 · 562 posts · 554 votes
    5y

    @Supada L.

    $5500 seems reasonable to remove and replace the entire driveway if that is what they are quoting.

    I agree this is more of a liability issue for a trip and fall lawsuit so I would definitely get it fixed. Maybe asphalt would be a bit cheaper for the short term.

    9Reply
  • Brandon Derksen
    Fort St. John, BC · Member since 2021 · 1 post · 4 votes
    5y

    @Supada L.

    Yeah I would get multiple bids. Is the residence located in a rural area where you could replace part or all of the driveway with packed gravel? Would be cheaper if you could do it

    4Reply
  • Sandra H Kopper
    Member since 2021 · 4 posts · 2 votes
    5y

    I'm no expert on this but I'm wondering where this property is located.  Some areas of Oklahoma and Texas have such unstable soil that foundations and driveways and sidewalks are a constant source of frustration.  Maybe you can have a good, open discussion with several vendors about what to do now that might prevent future expenses.  Unfortunately, you will have to remedy this situation now.

    1Reply
  • Supada L.
    OP
    New to Real Estate · Member since 2020 · 147 posts · 134 votes
    5y
    Originally posted by @Charles Carillo:

    @Supada L.

    This is not just a problem for their car but a lawsuit ready to happen and if your insurance learns of this; they are not going to renew your policy unless this is rectified. However; you might not need to replace the whole driveway; get other bids on just replacing part of it but the correct way of doing it is to redo the whole thing. Did you see this when you purchased the property?

    Thank you. I purchased it from Roofstock so I didn't see the property. But the inspection reports didn't suggest any driveway repair.

    1Reply
  • Supada L.
    OP
    New to Real Estate · Member since 2020 · 147 posts · 134 votes
    5y
    Originally posted by @Account Closed:

    @Supada L.

    $5500 seems reasonable to remove and replace the entire driveway if that is what they are quoting.

    I agree this is more of a liability issue for a trip and fall lawsuit so I would definitely get it fixed. Maybe asphalt would be a bit cheaper for the short term.

    Thank you for your advice. I'll ask my PM to get a quote for an asphalt driveway.

    1Reply
  • Supada L.
    OP
    New to Real Estate · Member since 2020 · 147 posts · 134 votes
    5y
    Originally posted by @Brandon Derksen:

    @Supada L.

    Yeah I would get multiple bids. Is the residence located in a rural area where you could replace part or all of the driveway with packed gravel? Would be cheaper if you could do it

    Thank you for your advice. I'll ask my PM to get bids from other vendors. Hope they could do just part of the driveway. 

    1Reply
  • Evan Polaski
    Cincinnati, OH · Member since 2020 · 4k+ posts · 3k+ votes
    5y

    @Supada L., asphalt is often far cheaper than concrete, so you could go that route.  Admittedly, I don't think it is as nice, but for a rental and compared to what you have there, it will be an upgrade.

    2Reply
  • Supada L.
    OP
    New to Real Estate · Member since 2020 · 147 posts · 134 votes
    5y
    Originally posted by @Sandra H Kopper:

    I'm no expert on this but I'm wondering where this property is located.  Some areas of Oklahoma and Texas have such unstable soil that foundations and driveways and sidewalks are a constant source of frustration.  Maybe you can have a good, open discussion with several vendors about what to do now that might prevent future expenses.  Unfortunately, you will have to remedy this situation now.

    Thank you for your response. It's in Mississippi. I guess the soil might also be unstable. I'll try to get bids from multiple vendors as others suggested above.

    1Reply
  • Supada L.
    OP
    New to Real Estate · Member since 2020 · 147 posts · 134 votes
    5y
    Originally posted by @Evan Polaski:

    @Supada L., asphalt is often far cheaper than concrete, so you could go that route.  Admittedly, I don't think it is as nice, but for a rental and compared to what you have there, it will be an upgrade.

    Thank you for your advice. I'll ask my PM to get bids for it. 

    0Reply
  • Andreis Bergeron
    Member since 2021 · 134 posts · 46 votes
    5y

    @Supada L. I would reach out to roof stock and see if they have contacts/vendors.  I know they do local partnerships and maybe they will help you out as you've only owned for a year and this was not mentioned prior to purchasing

    2Reply
  • Joe SplitrockPro Member
    Moderator
    Rental Property Investor · Sioux Falls, SD · Member since 2015 · 9k+ posts · 18k+ votes
    5y

    @Supada L. it is not a matter of the soil being unstable. The driveway is just really old and concrete only lasts so long. My guess is that driveway could be 50 years old, maybe older. It is probably original to the house. It was definitely that bad when you bought the property and the inspector should have noted it. As far as it tearing up the front end of the car, that seems unlikely if they are driving over it at a slow speed.

    Bottom line, that drive way was in that condition when they rented the property. It is not new damage that suddenly occurred. The driveway is old and as a result has settling. You could just tell the tenant, you rented the property knowing the driveway was in this condition. You don't have to approve all maintenance requests, especially requests that improve the property beyond condition when rented. 

    I would personally replace the driveway with concrete. You will do it once and it will last as long as you own it. It will increase the value the of the property, not only functionally, but visually. The current driveway makes the property look run down. I would not bother with asphalt. It requires sealing to keep it from deteriorating. Also if you park a motor cycle on asphalt on a hot day, the kick stand will sink into it. 

    9Reply
  • Steve Vaughan
    Rental Property Investor · East Wenatchee, WA · Member since 2014 · 10k+ posts · 16k+ votes
    5y
    Originally posted by @Supada L.:

    I have an out-of-state rental that I've relied on the property management to take care of it. I have owned the property for about a year and there has been minor fixes that already turned my first year cashflow negative.

    This is the lesson here.  OOS managed rentals can't cash-flow when the Maytag Man needs to be called for every little thing.  Period.

    OOS 'passive' rental ownership should be more of a wealth preservation strategy rather than accumulation needing cash-flow strategy.  There will always be minor fixes. 

    Yep, definitely replace that driveway with concrete.  Need to think long-term👍

    16Reply
  • Bruce C.
    Seabrook/Galveston · Member since 2018 · 274 posts · 178 votes
    5y

    You would need to check with some local contractors, but that might be a candidate for the just pouring over the top of.  If I remember correctly, it needs to be at least a 2” on any given spot on your new top, and it looks like you’ve got the room for that.  You might be able to save a decent amount on demo and removal. 

    1Reply
  • Shawn L.
    Rental Property Investor · Natick, MA · Member since 2015 · 128 posts · 188 votes
    5y
    Originally posted by @Bruce C.:

    You would need to check with some local contractors, but that might be a candidate for the just pouring over the top of.  If I remember correctly, it needs to be at least a 2” on any given spot on your new top, and it looks like you’ve got the room for that.  You might be able to save a decent amount on demo and removal. 

    Looks too broken up for any kind of topping to work, you'd end up with a bunch of sympathy cracking pretty quickly.

    4Reply
  • Dorian Weber
    Real Estate Agent · Wellington, FL · Member since 2018 · 36 posts · 17 votes
    5y

    Question - chip it up and replace with gravel?

    3Reply
  • Daniel SmythPro Member
    Rental Property Investor · Rockford, IL · Member since 2019 · 471 posts · 342 votes
    5y

    @Supada L.

    Welcome to real estate investing!

    No question; fix the driveway.

    Use fiber reinforced concrete and it will last longer with 6" of concrete vs the 4" thickness, which is usual.

    Barry the resident from driving his vehicle on the new cement for 14 days.

    Listen, you are going to spend good money. You might as well do it once!

    You bought the property with the bad driveway. You had to know it needed to be replaced. Best for the tenant, best for resale, best to do a job so you never need to do it again!

    [email protected]
    4Reply
  • Stephen Brown
    Real Estate Broker · Huntsville, AL · Member since 2019 · 1k+ posts · 872 votes
    5y

    $5500 for this will be well worth it down the road. I'd do it.

    1Reply
  • Supada L.
    OP
    New to Real Estate · Member since 2020 · 147 posts · 134 votes
    5y
    Originally posted by @Andreis Bergeron:

    @Supada L. I would reach out to roof stock and see if they have contacts/vendors.  I know they do local partnerships and maybe they will help you out as you've only owned for a year and this was not mentioned prior to purchasing

    Thank you so much. I will reach out to them.

    0Reply
  • Supada L.
    OP
    New to Real Estate · Member since 2020 · 147 posts · 134 votes
    5y
    Originally posted by @Joe Splitrock:

    @Supada L. it is not a matter of the soil being unstable. The driveway is just really old and concrete only lasts so long. My guess is that driveway could be 50 years old, maybe older. It is probably original to the house. It was definitely that bad when you bought the property and the inspector should have noted it. As far as it tearing up the front end of the car, that seems unlikely if they are driving over it at a slow speed.

    Bottom line, that drive way was in that condition when they rented the property. It is not new damage that suddenly occurred. The driveway is old and as a result has settling. You could just tell the tenant, you rented the property knowing the driveway was in this condition. You don't have to approve all maintenance requests, especially requests that improve the property beyond condition when rented. 

    I would personally replace the driveway with concrete. You will do it once and it will last as long as you own it. It will increase the value the of the property, not only functionally, but visually. The current driveway makes the property look run down. I would not bother with asphalt. It requires sealing to keep it from deteriorating. Also if you park a motor cycle on asphalt on a hot day, the kick stand will sink into it. 

     Thank you so much. I've listed that as another option to look at.

    0Reply
  • Supada L.
    OP
    New to Real Estate · Member since 2020 · 147 posts · 134 votes
    5y
    Originally posted by @Steve Vaughan:
    Originally posted by @Supada L.:

    I have an out-of-state rental that I've relied on the property management to take care of it. I have owned the property for about a year and there has been minor fixes that already turned my first year cashflow negative.

    This is the lesson here.  OOS managed rentals can't cash-flow when the Maytag Man needs to be called for every little thing.  Period.

    OOS 'passive' rental ownership should be more of a wealth preservation strategy rather than accumulation needing cash-flow strategy.  There will always be minor fixes. 

    Yep, definitely replace that driveway with concrete.  Need to think long-term👍

     Thank you so much. Yep. Lesson learned.

    1Reply
  • Supada L.
    OP
    New to Real Estate · Member since 2020 · 147 posts · 134 votes
    5y
    Originally posted by @Bruce C.:

    You would need to check with some local contractors, but that might be a candidate for the just pouring over the top of.  If I remember correctly, it needs to be at least a 2” on any given spot on your new top, and it looks like you’ve got the room for that.  You might be able to save a decent amount on demo and removal. 

     Thank you for your response. That looks like another option to look at.

    0Reply
  • Supada L.
    OP
    New to Real Estate · Member since 2020 · 147 posts · 134 votes
    5y
    Originally posted by @Shawn L.:
    Originally posted by @Bruce C.:

    You would need to check with some local contractors, but that might be a candidate for the just pouring over the top of.  If I remember correctly, it needs to be at least a 2” on any given spot on your new top, and it looks like you’ve got the room for that.  You might be able to save a decent amount on demo and removal. 

    Looks too broken up for any kind of topping to work, you'd end up with a bunch of sympathy cracking pretty quickly.

    Oh, I didn't think about that. Thanks for pointing out.

    0Reply
  • Supada L.
    OP
    New to Real Estate · Member since 2020 · 147 posts · 134 votes
    5y
    Originally posted by @Dorian Weber:

    Question - chip it up and replace with gravel?

     Sounds like a good option. Thank you.

    0Reply
  • Supada L.
    OP
    New to Real Estate · Member since 2020 · 147 posts · 134 votes
    5y
    Originally posted by @Daniel Smyth:

    @Supada L.

    Welcome to real estate investing!

    No question; fix the driveway.

    Use fiber reinforced concrete and it will last longer with 6" of concrete vs the 4" thickness, which is usual.

    Barry the resident from driving his vehicle on the new cement for 14 days.

    Listen, you are going to spend good money. You might as well do it once!

    You bought the property with the bad driveway. You had to know it needed to be replaced. Best for the tenant, best for resale, best to do a job so you never need to do it again!

    Thank you so much. I guess that's called investment, isn't it? :) 

    0Reply
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