How much value does new appliances add to a 2-4 multifamily?

Question

I am purchasing a 3 unit apartment, all with outdated appliances. I am trying to set myself up for the most efficient appreciation before I plan to refinance and put that money towards another property. Is there a rough estimate on what a new appliance is worth on appraisal? I plan to print off a retail value sheet for every appliance in hopes that it will help the appraiser make better judgement on the value of each appliance.

Justin Wilcox · Answer

If this is a buy and hold property, despite being able to get appliances cheaply, I would buy them from Costco. Their warranty is forever. It may cost more, but in the future you will just have to pay for the removal and install and they will replace the unit for FREE.

Just food for thought. It's what I plan on doing with my properties once things start going out.

Andrew Severino · Answer

Appliances won't be factored in a residential appraisal for value.  The primary value new appliances will add for you is happy tenants, and low or no maintenance for you going forward until they start to break down.

Austin Fruechting · Answer

Can you raise rents from their current rate if there are new appliances? If so then the rent increases from the appliances will definitely increase the value of the property.

Andrew Michaud · Answer

I would assume the majority of 2-4 units around here have base white appliances. A am talking a few hundred dollars per stainless steal appliance. Thats why I figure this to be a no brainer. All non stock special order return appliances I am able to get for cheap at the big box stores. So I would see a gain over the market in my area because stainless is greater than white in value, but I am actually paying way less than either on retail. Intending to get 8k worth of appliances for under 2k. It is very possible in the scenario I am in. Just curious on if it is possible to actually add value going forward with this.

Alexander Felice · Answer

well what's the value of the building?

are you adding 10K worth of appliances?

The base set of white appliances at lowes is like $1100, I bought a base set of appliances with stainless finish at lowes recently for $1500. You can spend a lot more on upgrades, but your value is going to be determined by comps like you said, so if everyone in the area has average appliances you're going to MEET those standards, not exceed them.

Let me ask you this, how much do you intend to spend on appliances so I can give you more accurate advice.

Andrew Severino · Answer

Coin operated laundry won'r add any value for just a few units.  The revenue will be negligible.

Andrew Michaud · Answer

@Alexander Felice, even on a 2-4 unit which to my understanding is based off of comps and not on NOI like a 5+ property?

Alexander Felice · Answer

Will they add value to tenants, sure

They won't add any value to an appraisal though.

Unless you do like @Ron Orr and find some way for them to directly affect NOI

How much value does new appliances add to a 2-4 multifamily?

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