4 plex and Windows

8 Replies

Hey All,

I am getting ready to close on a fourplex that needs alot of love. I worked with the seller to get some of the work done, and paid for by him as part of our deal. However, the one thing he wouldn't budge on was windows, as the tenants pay for their own heat, so in his eyes, this was a waste of money. So now I am looking at paying for the windows myself after closing and getting them installed during the rehab before I put tenants in. No big deal, but the windows are $8K, which puts me past my available cash for my rehab. Am I crazy for wanting to dump this much money into windows when it won't save me any money in utilities, and it won't allow me to charge more in rent?

Every other rental I own already had new windows, or they were installed as part of the sale agreement, so this is a new world for me.

@Mike Sattem   I personally wouldn't spend $8000 on the windows unless it either added value to the property as a whole, or increased the amount I could charge rent. If the upgrade does neither, then it is a bad investment, unless of course they are in such disrepair that they have to be fixed, for example busted out with wood boards in their place.

Depends on the condition of the existing windows.  If they are fully functionally, then you might not need to.  However if they are damaged or just really really old .. I would consider it general maintenance and updating that will eventually have to get done.

If it adds value and can help force appreciation then I would go for it. Since is not a necessity, I would wait until more funds are available for such a big project though.

In your location I imagine fresh air can be enjoyed much of the year and is an integral part of daily life (unlike middle Georgia where we keep the windows closed 90% of the year). Ask yourself why you consider them important and what value the tenant/potential buyer may place on them. Just last month I was told by a purchaser he'd backed out of a deal because he couldn't open the windows because fresh air was something he valued.

@Mike Sattem  

My view will vary a little from the other responses you have received thus far.   We operate in a northern climate, and there is often substantial advantage to replace original windows - especially if they are old, built in-place, single glazed, single/double hung - with energy efficient double/triple glazed windows {casements are preferred as they are more efficient}.   This best done in concert with other insulation improvement to the building envelope.

Our experience with energy efficient improvements to older buildings is that it helps with Tenant retention (lowering turnover) and, contrary to your vendor's opinion, we firmly believe that tenants are entitled to safe, healthy, and energy-wise, accommodations.

On approach you could take would be to stagger the window replacement. I realize that it is far easier to change them all now while the building is empty, especially if you are renovating the interior of all units.   If you are not remodelling all units, replace the windows in those you are and leave the remaining unit(s) until you renovate their interior.  An alternative would be to replace the windows in those units with predominate north and eastern exposures first and the others at a later time after you have replenished your reserves.

I agree with @Roy N.   Evaluate the type and condition of the windows. If they need replacing, do it. This is the best time and if you have money in reserves (which you should have) then it makes sense to do them all. It will definitely be positive for you when you market the rental. We in the Pacific Northwest do value energy efficiency. More and more prospective tenants are asking for energy efficiency and do care about the quality of  insulation, windows, doors, and appliances. Also, if the current windows are sweating and creating a mold/moisture problem, then there should be no question about it. The investment will be worth it and it will be depreciable.

How much are you paying for EACH of the windows? I can get double-hung, double-glazed vinyl installed for $200/per.  

I'm thinking you'll find a much better deal than $8k, and it may not be a priority for tenants/you after you own the property.  Time will tell and this might be an investment you won't know whether to make until you have the property for awhile. 

Thanks for the comments everyone. I went ahead and did the windows as a part of my rehab. Total cost was $4,600 installed for custom made vinyl 19 windows (dang old houses and their weird sizes!). Just got my appraisal back and I have gained $40,000 in value above my purchase price plus improvements, so I am very happy with my choices.

Thanks Again,