Appliance Repair or Replace Decision Calculator

[Craig S.]

Hi BP Community,

I purchase all of my appliances brand new for my rental properties. I have experienced several occasions recently where I am faced with the decision to spend the money to repair or replace the appliance. This doesn't matter if it is a range, refrigerator, washer, dryer, etc.

Up until now, I always just kind of used my gut feelings and guesstimated whether I was better to repair or replace the appliance in question, considering its age, cost to repair vs. replace, etc. I like to systematize repetitive tasks, and thought about this situation. So I decided to create a basic formula with a "decision engine" so I didn't have to make a random guess, but rather make the decision based on what the data shows every time I am faced with the decision to repair or replace.

I am sure other landlords are faced with the same decisions, so I thought it might be helpful if I shared the spreadsheet I came up with. I could make this really "smart" and more complex by factoring in additional variables into my formula, like current vs. effective age (if I make a repair the lifespan of the appliance will be increased), time value of money, efficiency of newer appliances vs. old ones, etc. however my goal wasn't to get overly complex, and just make a simple formula to make better data-driven decisions on this semi-frequent occurrence.

To use the formula, you would just enter/change the values highlighted in yellow on the spreadsheet and the rest will auto-calculate.

If you spot a simple way to improve the formula or think I forgot about something, please let me know and I'd be happy to improve the formula. All in all, my main goal of this post was to share something I built that I found useful and believe other landlords might benefit from. Hope it helps!

[John Warren]

@Craig S. appliances are definitely one of the most annoying things to deal with and appliance repair is actually one of the toughest things to do well in my experience. I always trend towards repair unless my repair guy says it just isn't worth it. I find that new appliances can have issues pretty quickly... one of my first refrigerators had a repair just after the one year mark which is insane! I also will place quite a few used appliances as long as they are aesthetically pleasing.