What would you do? Furnace issue caused high electric bill

12 Replies

Here is the scenario. Due to a defect in the furnace it may have caused the a/c to run while furnace running causing a high electric bill. Tenant is asking to reimburse electric costs. If it proves the case, how would you handle it? My lease has a clause that I am not responsible for defective equipment and everything is as-is. I want to be reasonable. Couple of points. - tenants are excellent. Want to keep them. - I want to do the right thing within reason - I don’t want to set a precedence to bad practices. - bill was $250 when it’s typically 150. What would you do? BP - Thank you in advance

Quality of tennat is irrelevant. Additionally you do not agree to anything out of a concern over losing a tenant.

If it were me in this situation where I believe there is a defect I would pay the tennat the $100 difference in heating cost if I am certain the additional costs is accurate.

If they were a good tenant and were there awhile I would fork over the $100. To me that is cheaper then haveing them move out because of it, then have to clean/paint/advertise plus loose out on a few weeks of rent.

Thanks. I appreciate your responses and I agree.

Would you advice signing a simple agreement summarizing the issue and that payment? Just to have paper trail...

Hey Ron! That's tough when stuff like that happens, but I agree with the others, the best thing to do would be to cover the cost. I would just put a $100 credit on their account for your paper trail with a memo. 

@Matt DeBoth

A tennat that would leave over a $100 cost is likely in the process of leaving regardless of whether you pay or not. Paying will have zero impact on whether good tenants stay or not.  You never pay money to a tennat that you do not owe expecting it to in some way effect whether a tennat will stay or go. They will take the money and leave regardless.

You pay if you owe, no other reason.

What type of furnace is this ? if its a heat pump , what you described doesnt happen . 

Thanks, Matthew.

It is a heat pump. Can you explain why it will not happen?

When the a/c was on the heater ran causing the place to heat up. So tenant think the reverse is true. I appreciate if you can explain

I had a hot water heater leaking and it cost an additional $100 on the tenant’s electric bill. I took $100 off their rent the following month. Great tenants who weren’t going to leave either way, nor did they ask for reimbursement, but I just felt it was the right thing to do. And they were extremely appreciative.

Originally posted by @Ron DeMaria :

Thanks, Matthew.

It is a heat pump. Can you explain why it will not happen?

When the a/c was on the heater ran causing the place to heat up. So tenant think the reverse is true. I appreciate if you can explain

A heat pump has a reversing valve , it cools in one direction and heats in another . There is also emergency heat , straight resistance heat . That may have been on . But I believe there is a safety so it cant . But on a heat pump the unit cant run on heat and AC at the same time .   

I learned something new - Thank you, @MathewPaul

I also a golden rule to fellow investors, I learned this with this issue.

It’s best to tell repair techs only to share details with you. Since distorted facts can cause confusion like the one I am dealing with...

It is a small amount of money so I would pay it as an act of goodwill.

Is it possible that due to the cold weather the emergency heat was needed, thus the $100 extra heating bill? That would not be a surprise. 

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

Lock We hate spam just as much as you

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here