Washer/Dryer repair or replace

[paul85s10355]

Hello



One of my rental properties in Barrie has a leaky washing machine and the dryer is acting up not always drying the clothes, the units are fairly old. With the boxing day specials would you guys recommend just replacing boht or having a repair man in?



Anybody know any good appliance techs in Barrie?



Thanks Paul

 

[DaveL]

If they are fairly old I would just replace them especially with boxing day sales on. An appliance serviceman is going to cost you at least $150 to come out and tell you to buy a new one by the time they order the parts you need etc... I just looked online and saw washer/dryer combos starting at $500

 

[invst4profit]

I would buy used off of Kijiji if I did not intend to repair the old machine myself. A good set under 5 years old should run $250 - $500 (max) and provide 10 years of trouble free service.

Remember a new set is only appreciated as long as your present tenants remain. After than any new tenants are getting a used washer and dryer.

 

[JoeRagona]

Get new, you can get extended warranty on them which saves you in the long run also. I've tried sending my handyperson in Barrie to look at ones found on Kijiji and it was a waste of his time (at least for me it was worth spending the money for new and having him install them)



If you have the time and get lucky, you can definitely find good deals anywhere. However, your time is your most precious asset - money is replaceable - just ensure you stay within budget - that's what the SPF is for right ?

 

[invst4profit]

Joe you are in a different business than I am and possibly different than the OP.

Extended warranties and hired help running errands do not fit into my business plan.



Keep in mind for the small landlord every dollar spent is a dollar lost and most believe their time is the only thing that is free. They are not in the business of searching for more investments and don't make enough profit on their present investments to believe their time is worth more than the hourly rate of trades men.

When two hours is spent fixing something rather than hiring a repair man they consider they have saved/earned $100 dollars. That two hours in their life would not be spent elsewhere earning anywhere near $100 dollars.

The cost of a extended warranty could be equivalent to one months positive cash flow, a new washer and dryer a years positive cash flow.

 

[paul85s10355]

Well I got the news from Mr appliance today and it wasn't so bad, 300 bucks to fix the washer and dryer. I do value my time and living in Burlington now makes it a little more difficult to get to Barrie. I was thinking of buying Kijiji but my time to source them, look at them, pick them up, deliver to Barrie, bring someone along to help lift, gas, install them etc and the biggest my time which I do value even at the age of 25 it was just easier to have them repaired. I appreciate the input and Joe if you have a great handy man in Barrie I would love to get his contact info.



Thanks

 

[invst4profit]

There are definitely additional costs associated with not owning properties conveniently located to where you live. Especially when dealing with minor problems or difficult tenants.

 

[stevegwhite]

Despite the fact that I got a good deal on a fridge and stove as well as a dryer this summer, I'm a bit weary of the offerings on the classified sites.



Keep in mind that it's rare that someone REALLY wants to sell a 2 year old washer/dryer set 'in perfect running condition' because they just bought a new set. I've heard frequent stories about Kijiji being the dumping ground for appliances that are too expensive to fix. Many are unhooked and parked in the garage where they can't really be tested.



There are certainly good deals to be had, but you often need to be careful that you're not buying someone else's problem because you'll be out the cash for appliances and any hookup fees on top of having to buy new ones in the end.



One alternative is to check out repair shops. Many of these shops will haul away an old appliance that they owner doesn't want to repair. They'll get the part at cost, make the repair in their down time and will almost always offer a warranty on it. I have a second unit that I just replaced the old stove with a nice glass top one with warranty for half the price of a bottom of the line model and I have a warranty. The tenants were thrilled with their 'Christmas Present'.

 

[Hilary Kohal]

I am a big believer in the extended warranties as well, Joe. I bought appliances at Sears during one of their big sales and purchased the extended warranties that will be refunded in full at the end of the warranty period IF I don't have reason to use them. Many companies are offering this warranty refund (I purchased a dining room suite with the same deal). The trick is to remember those expiration dates!!!



Hilary

 

[paul85s10355]

What about on personal residencies do you think the extended warranties are worth it? I am closing on a place in Milton in June and just purchased a 5 appliance package from the Brick, they offer the extended warranty and if you don't use it they give it to you in Brick gift cards. I have always read the extended warranties are a waste of money?

 

[Karma]

Another consideration- a repair bill can be written off as an expense while new will only provide CCA deduction. Always considering the tax implications is an important part of the business- at least for me . . . but I pay a lot of income tax (salary outside of RE over 100k).



S.G.

 

[housingrental]

I'd go new

I do not recommend extended warranty

On average it you'll net more not purchasing extended warranty

If something breaks down that's covered it's often slower, and more time for you as well, than dealing with local repair man

 

[housingrental]

Hi Greg

Your perspective is how people end up in the same place their at year after year.

Would it not be better for an investor to focus their time on it's highest and best paid purpose?

If you are making less than a handyman at a job why not dedicate the time to change that?

And if you own investment properties, aren't you generally making more than a handyman already?



[quote user=invst4profit]Joe you are in a different business than I am and possibly different than the OP.

Extended warranties and hired help running errands do not fit into my business plan.



Keep in mind for the small landlord every dollar spent is a dollar lost and most believe their time is the only thing that is free. They are not in the business of searching for more investments and don't make enough profit on their present investments to believe their time is worth more than the hourly rate of trades men.

When two hours is spent fixing something rather than hiring a repair man they consider they have saved/earned $100 dollars. That two hours in their life would not be spent elsewhere earning anywhere near $100 dollars.

The cost of a extended warranty could be equivalent to one months positive cash flow, a new washer and dryer a years positive cash flow.

 

[invst4profit]

Investors should focus there time and efforts on there highest paid purpose.



In my case I have stopped being a investor, in that I no longer seek out additional investments, and therefor am concentrating on being a landlord. Yes I do make plenty of money from my rental income but I also supplement that income by not hiring handy men when I can do the work myself. Many jobs I do in my spare time for 8-16 hours save me thousands in expenses and are well worth my time.

I am highly skilled at what I do and very efficient.

Any time I can put in a day of my labour to save $1000-$2000 is time well spent and frankly more pleasurable than the same 8 hours behind a desk. When the day comes that I can no longer work I'll sell and sit back and enjoy the spoils. For the time being I earn my money the old fashion way, somewhat, and that is the way I like it. I could hire others to do the work and still remain financially comfortable but frankly there is no fun in that.

Don't forget I am retired and receiving a employer pension as well as income from multiple other streams.

I have the free time to enjoy what I do and make money. Truly a luxury by my standards.



Other small landlords starting out do not have a choice and must do the work themselves to survive in this business. For them the reality is far from the REIN ideal and have a long way to go before they will ever be armchair investors. Frankly not everyone has the skill sets to earn higher wages than tradesmen.

 

[housingrental]

Thanks for the response Greg!



Your situation is great - and if you enjoy handyman work this makes a lot of sense - somewhat similar to someone building a birds nest on the weekend or other type of hobby.



I guess we will need to say we have different perspectives on the business side of things though - I'd suggest the vast majority of rental property owners should hire someone for these type of jobs. If they do not make more than a trade, they should dedicate their time to advancing their own skill set in whatever their career choice so they have the expertise to command a higher wage over time. The truth is also that the vast majority of people who will be able to save up enough money to purchase investment properties already have a higher wage than they'd pay a handyman to do work.

 

[invst4profit]

The vast majority of landlords are actually mom and pop businesses not REIN investors.

These are the types of owners that you will typically find on the Ontario Landlord forums that are struggling to break even on there properties.

In addition most are working regular day to day jobs without the ability to increase there incomes which is why many mistakenly invested in rental properties believing it was easy money. They do not personally earn more than qualified tradesmen wages and therefor usually do the repairs themselves. I doubt the majority even see themselves as running a business.



Most would view REIN as little more than a platform for members to sell their products and services.

 

[paul85s10355]

Eventhough I am young at 25 I do view my rental properties as a business, 1 on my own and 1 as a joint venture, both cash flow positively and are doing well. Both of them have great tennants with great payment history and stable jobs. I did not get into real estate investing for quick easy money as it can be challenging. I am in it for building equity and a minimum 5 year hold.



I simply wanted an opinion as I was concerned I was going to pay someone 150 dollars to come look at the appliances and tell me I need new ones. With all of the boxing week sales I could have picked some up between 750-1000 but in the end the repairs were under 350 which worked out well. I am capable of basic repairs but when it comes to electrical, HVAC etc I want to make it as painless and hassle free for my tennants so in this case a diagnosis and repair was the most beneficial for both parites myself and the tennants.

 

[stevegwhite]

REIN investor or mom and pop, anyone investing in real estate needs to look at it like a business. You have the safety and welfare of your tenants to consider.



In my case, a $550 bill to replace a toilet, fix a bathroom fan, fix a running toilet and a few odds and ends isn't ideal. However my time is infinite and if it were going to take me five hours to do all that and then another five hours to fix the problems I caused, I need to evaluate how my time is better spent. I also have the luxury of a side business I can turn to to make up the cost of the repair in a fraction of the time it would take me to make the repair.

 

[JimWhitelaw]

Regarding appliances, we've done well by buying refurbished or new "scratch & dent" units. They come with delivery & warranty and the vendor takes away the old units. Pricing is less than new. For these units, extended warranty isn't available and hasn't been an issue.



Regarding doing your own handyman jobs (where that's an option), I think it's really relative to HOW you would have spent that couple hours and whether you enjoy that kind of work. For most smaller investors, the time spent on little maintenance jobs isn't coming at the cost of highly paid work, it's coming at the cost of leisure time. So the money saved is 100% profit and for some people, doing such work is enjoyable too.



Personally, I hate doing reno/repair type work and as much as possible I hire it out, including for my own home. I'd rather "waste" my spare time playing video games with my kids than do repairs.

 

[Sherilynn]

[quote user=Karma]Another consideration- a repair bill can be written off as an expense while new will only provide CCA deduction. Always considering the tax implications is an important part of the business- at least for me . . . but I pay a lot of income tax (salary outside of RE over 100k).






The old appliances should have a value on your books that you would be able to expense. It could be only $100, but if you can expense that and then get a scratch & dent or reconditioned unit for $200, then half is deductible.