Attract High-Quality Tenants with New, Low-Cost Appliances
A small initial investment in low-cost appliances for your rental property will likely result in big savings, increase your property’s resale value and serve as a prime tax deduction. Installing the right appliances means your maintenance costs will be lower when your appliances break down or stop working completely.
New, low-cost appliances attract high-quality tenants and make them happy, ultimately resulting in longer-term lease signings. Furthermore, low-cost appliances are fully tax-deductible under Section 179 of the Internal Revenue Code. So, if limiting turnover at your property, boosting occupancy rates, saving money and fully deducting expenses sounds appealing, invest in new, low-cost appliances at your rental property.
Energy-Efficiency Is Key
“One of the most important features any new appliance should offer is energy efficiency,” explains Billy Wardlaw, senior operations manager at Mynd Management and head of Mynd’s construction services division.
Look for appliances with the Energy Star label and make sure to keep the sticker on your appliance to proudly display to your tenants. “Environmentally friendly appliances not only appeal to residents because they save them money, they will save owners money over the long-term,” he says.
One Brand of Appliance Stands Out Above the Rest
Wardlaw favors General Electric (GE) appliances for their “extreme durability” and because they offer property owners an exceptional warranty, since GE is a Mynd preferred vendor. Instead of only obtaining a one-year warranty that comes standard with most appliance purchases, GE offers a two-year warranty to all Mynd owners. As a result, Mynd owners can save anywhere between 5% and 20% if they buy new GE appliances and install them at their property.
Low-Cost Appliances That You Should Install Now
Which low-cost appliances attract great tenants?
Topping Wardlaw’s list are:
- a gas stove
- garbage disposal
- washer and dryer
- low-flow toilet
- low-wattage heater
- energy-efficient light fixtures
- energy-efficient faucets
- energy-efficient valves
10 Out of 10 Chefs Prefer a Gas Stove
- When your power goes out, your stove also goes out if it’s electric. On the other hand, a gas-powered stove doesn’t stop working in the event of a power outage, ostensibly keeping your tenants safer.
- Foodies and chefs typically prefer a gas stove since the oven and burners heat up much faster and more evenly than their electric counterparts.
- Cleaning is a breeze: Gas cooktops are much easier to clean and maintain than electric ones.
A Dishwasher Makes Life Easier
- A low-cost dishwasher allows for an extremely easy post-meal clean-ups. When your tenants keep your property clean and tidy, they generally save you money in the form of lower upkeep and maintenance costs, especially after a move-out.
- Installing a dishwasher sends a signal that you care, which puts smiles on the faces of your tenants. Happy tenants tend to stay put and lease your home for a longer period of time than disgruntled tenants.
A Garbage Disposal Does More Than You Think
- Whether it’s a ¼ or ½ HP (horsepower) garbage disposal, this small, motorized machine under your sink efficiently disposes of the leftover food on your plate after a meal so that less waste ends up in your local landfill.
- Priced between $200 and $300, a garbage disposal additionally functions to keep your pipes – especially your P-Trap – clean.
- Wardlaw reminds tenants to refrain from throwing large amounts of food in the garbage disposal, especially if they have a ¼ HP appliance or smaller, as it could damage the blades or cause the disposal to break down completely.
A New Refrigerator Boosts Your Returns
- Even if it’s not a state-of-the-art appliance, a new, standard-model refrigerator increases your ROI over the long term and cuts down on the number of service requests your tenants will make to their property manager.
- A stainless-steel refrigerator adds even greater value to your rental asset and remains a popular option among many renters and owners alike right now.
- French doors add to your refrigerator’s functionality as well as its aesthetic appeal.
- Even a traditional-looking, white refrigerator will be appreciated by your tenants if it’s sparkling clean and brand new.
A Washer/Dryer Increases Your Rental’s Value
- According to the National Apartment Association (NAA), providing an in-unit washer and dryer in your rental boosts your home’s value by 15%.
- Again, this appliance sends a message that you care about your tenants as an owner. As a tenant, taking your laundry to a laundromat or arranging for a laundry service is inconvenient, time-consuming and can become expensive, Wardlaw says.
- An energy-efficient washer and dryer costs less to operate than a coin-powered machine at a laundromat, so these two appliances additionally save your tenants money on utility bills over the term of their lease.
Flush Your Worries Down the Drain with a Low-Flow Toilet
- As the name implies, a low-flow toilet conserves water, which is a must-have feature in drought-prone regions of the United States such as California or the Southwest.
- A low-flow toilet saves your tenants money on their water bill each month.
- An environmentally-friendly appliance, a low-flow toilet appeals to conscientious and respectful tenants, who tend to be responsible and good caretakers of your precious investment.
Save Energy with a Low-Wattage Space Heater
- A traditional space heater consumes inordinate amounts of energy, while a lower-wattage alternative may only use between 50 to 750 watts – slashing your tenants’ electricity bill.
- A lower-wattage heater keeps your tenants just as warm as a high-wattage option, especially in smaller spaces like a rental home or apartment, according to Wardlaw.
Conserve Water with Energy-Efficient Faucets, Shower Heads and Valves
- Much like the aforementioned low-flow toilet, these energy-efficient kitchen and bathroom fixtures are a necessity in regions prone to droughts and water shortages.
- Energy-efficient water fixtures in your bathroom can significantly reduce your tenant’s water bill each month.
- Once again, these environmentally-friendly fixtures appeal to conscientious, respectful tenants who will take good care of your investment. And, a well-maintained asset generates a higher resale value.
- A shower head is a very inexpensive appliance that still provides your tenants with an abundance of water when showering, says Wardlaw. Given the high quality of today’s manufacturing processes, tenants can’t tell the difference between an energy-efficient shower head and a traditional one.
Low-Cost Appliances Are 100% Tax Deductible
Not only is buying new, low-cost appliances a great way to attract quality tenants, but it serves as an effective tax deduction. Sec. 179 of the Internal Revenue Code allows taxpayers to “deduct the cost of certain property as an expense when the property is placed in service.” The maximum Section 179 expense deduction totals $1 million, while the phase-out limit is $2.5 million, indexed for inflation for tax years beginning after 2018.
Sec. 179 allows landlords to deduct the cost of personal property items they purchase for use inside rental units, including appliances, carpets, hardwood floors, drapes and blinds. For example, if you spend $10,000 on new appliances for your rental asset, you can deduct the entire amount that year under Sec. 179.
The next time a tenant moves out of your property, consider buying new, low-cost appliances to increase your property’s resale value, limit your tax liability and to show you truly care about the people living inside your home.
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