Buying Strategy on Property with Ancient HVAC

[Lee G.]

I found a single family property that I am interested in, however the HVAC is over 20 years old.   I was planning to live in it for 2 years and then turn it into a rental.  I've been through this before and would rather go ahead and have the new HVAC in place before turning it into a rental because I know first hand of the headaches of a dying HVAC unit.  

I'm estimating that the HVAC would cost between $6k-8k.  I would love to hear opinions on how you factor in aged HVAC into how much you would buy this property for.   This property has lots of upside potential and I'm thinking that the price that the sellers would agree on is $115,000.  My thinking is that this house will not need significant repairs for 10 years after the HVAC is replaced.   

Also, would it be a good negotiating strategy to get the house under contract and then after inspection ask for a price adjustment for the aged unit? 

[Aaron Montague]

@Lee G.

Any strategy is going to be a crapshoot.  There is always something bound to piss the seller off.  Personally I'd be up front about the $7k to replace to HVAC unit.  If $115,000 is the right price, come in at that, with "New XYZ brand HVAC unit installed."  You can talk about this with the seller before the deal goes to paper. 

They may want to gamble on someone else not knowing the 20 year old HVAC, but as you mentioned, it's going to come up during the inspection.  Maybe the thing has 10 years left on a transferable warranty, who knows?

I like to load up my marbles up front and save everyone time down the road.  I'd come at this with the expectation I need at least a $7k discount or brand new HVAC unit to make it a viable rental property.  The seller's response will be something between "F*** you!" and "no problem."