heat included in rent?

Question

Hello BP!

I'm in the process of closing on a 4-unit with one heating system for all four, controlled by two thermostats.  My first thought was ditching the unit and adding 4 mini splits with heat/cool.  Anyone have thoughts on moving the two thermostats to the hallway, putting them on my phone for monitoring via wifi with a lock of of xx degrees, and including it in the rent?  If so, any recommendations on which thermostat to go with? I have exposure to Honeywell and Nest

Christopher DeAraujo · Answer

The property is on oil, so i would take that on and bill it to myself.  Locking at 70 in the winter and 50 in the summer would be my thoughts if going this route.

Tenants will always have a concern to address

Christopher DeAraujo · Answer

@Alecia Loveless i did not include our one heater to be oil.  Anything i do will likely result in a large upfront cost.  I'll explore the mini split, and the space heater options once the time comes.  I can likely convert one of the four 1 bedrooms to a 3 which will stay on the main heat source for the interim.

Alecia Loveless · Answer

@Christopher DeAraujo I am in the process of getting out of the business of paying for tenant heating given the volatility of oil prices and having seen 5/20 tenants put their heat up to 78 and keeping their windows open for fresh air when it was -20 degrees outside.

I’m installing propane Rinaii heaters in 3 buildings where each larger room will have an individual heating unit and each unit has its own meter.

There is a significant upfront cost associated with this but I have calculated it will average 2.2 years per building to save the cost I’m currently paying for oil. This does not include the tax write-offs for new systems and the expense of installing them. The write-offs will make the time to recover my costs that much faster.

In my area electricity is prohibitively expensive so mini splits are out of the question. Electric heat adds $400/month to the only 1 bedroom unit I own that has it. Also window units for AC are standard so no concerns making tenants buy their own and pay for this.

I have a great commercial rate for my oil and propane which I can pass along to the tenants as they take over their new meters.

Kristine Ann · Answer

If you have one heating system controlled by two thermostats, don't you have to include the heat in the rent either way?  There would only be one gas bill, correct? If tenants are paying their own heat bill, they would call the gas utility and have the unit put in their own name, but tenants can't do that if the heating unit is shared by all four units.

You won't have happy tenants if you are in control of the heat and you aren't even on premises.  Some people want it at 80 and others at 65...they will all be  unhappy.  The temperature in the hallway may be very different than in one or all of the apartments due to drafts and just how the vents are set up.  Heat often isn't distributed throughout a building equally.  Some apartments might be burning hot and others cold as ice.

I've run into owners of airbnb's keeping the heat/AC at 80 and refusing to change it remotely.  It makes for a a very unpleasant stay and very unhappy customer.

Christopher DeAraujo · Answer

roughly a $40k investment i was hoping to kick down the road. I was concerned with heat pumping and windows open, too.  You're probably right

Jacob St. Martin · Answer

I would probably go the mini split route if there are easy places to install them. If not then you could just put in a smart thermostat and lock it but you are inevitably going to have people unhappy with the temperature.