All Forum Posts by: Dean Valadez

Thanks, Everyone, for the input! Now it makes sense why there is such a wide range of costs associated with turnovers. I keep reading/hearing that tenant turnover is one of the most expensive costs that landlords have and wanted to see why, and then, how, to minimize those costs. Does anyone pay their tenant to move out early so you have more time to get in to clean/renovate/etc? (That is if you know you have more to do.) Such as, every day they move out early, you pay them $15/day or $10/day or whatever amount it is.

 I appreciate your input, Alan. Question: when you have no vacancy, how do you get the old tenants to move out so you/your team can have enough time to do touch up paint, carpet shampoo, remedy normal wear and tear, etc., and then have the unit ready to go for the new tenant for the 1st of the month? Didn't the old tenant just leave the unit the day prior? As mentioned, I have been fortunate that my leases have been renewed and haven't yet experienced a turnover. Thanks!

 Thanks, Marcus. This sounds more in line with what I have been hearing in podcasts, and I am wondering how some comments are that they have $0 in turnover costs. Question: what is the $2k for re-leasing costs? In other words, why does it cost that much to lease a new tenant? Is it for marketing, paying a PM to re-lease it, or something else?

Why do you distinguish a difference between a SFR and an apartment for turnover costs? Wouldn't they be similar? You mention an apartment would also lose 1 month of rent (let's just say $1500 for lost rent for easy math), and then $2000 for paint and carpet. What about that re-leasing cost you mentioned for your SF? Wouldn't that apply for an apartment as well? If so, the apartment turnover would be about $5k-5.5k. Am I not seeing something?

Thanks!

 Thanks, Theresa. I am curious about the turnovers that cost you nothing. Did you not have a vacancy during the turnover? If no, how did you get the old tenant to move out to allow you time to clean and remedy normal wear and tear, and then get the new tenant in on the first? If you did have some days of vacancy, isn't the vacancy itself a cost due to lost rent? I appreciate your input!

 Thanks, Nathan. Just wondering, how are your turnovers $0 (as mentioned in your first post)? Don't you have someone, or yourself, even do touch up paint on walls, have to pay for cleaning services, etc? Thus, if you factor in your 1/2 month lost rent and utilities, plus any costs (even purchasing more supplies) to touch up paint and clean, wouldn't that still be a turnover cost of around $1000 (give or take since I don't know what your rent, utilities, paint, and cleaning services might be)? I am assuming that the 80% of tenants that get a full refund still have normal wear and tear that you need to remedy and then pay for....

Hello,

I have been hearing on BP podcasts that tenant turnovers can equal about $6000-8000 (one host even said up to $10k, if I recall correctly) when lost rent and repair/upgrade costs are factored together. That seems quite high and I wanted to see what some of you experience. I searched for turnover answers but some of the posts were either old, or did not have exactly what I was looking for. I am fortunate to not have had tenant turnover yet and I PM my own four-plex and single family rental. I am simply pre-planning should I have a tenant move out in the future after their lease expires and they don't want to renew. I realize there are a lot of variables at play during turnovers, such as:

- What was the condition prior to tenant move-in and what is the condition after move-out?

- What property class is the rental (A, B, C, D)?  that could determine the quality level the unit needs to be at for a new tenant

- Am I doing the work myself, or hiring out?

- Is there a lot of updating that needs to be done to the unit?

- How long the unit sits vacant for repairs/cleaning, and finding a tenant

- City/town/state the unit is in

Please respond with your thoughts, hopefully with the bullet points above as points of reference and stated as such in your reply (I know, I am asking for a lot from you all :) ) But, for example, a Class D property in Milwaukee, WI probably requires less turnover time, lower quality materials, not as precise of a paint job, etc, than perhaps a Class A property in San Francisco, which would require higher quality materials, higher labor costs, longer vacancy since more precise craftsmanship would be required, etc. Thus, if the owner of their Milw, Class D property replied without noting the above, he/she might say it only costs $1000, whereas the owner of the SF Class A property might say, $10k, but if I didn't know their location, property class type, if they used contractors, or did the work themselves, etc., then I would still have too wide of responses to be able to anticipate what the real costs might be for my particular situation, property, etc.

For reference, my properties are in Class B areas of Milwaukee. I acquired the four-plex with varied levels of updates, but would need/want to paint cabinets, paint doors, trim, walls; if carpeted, replace carpet with LVP; replace faucets with modern faucets, etc. Some work I can do myself, but for time purposes, would hire out. Units are in good shape otherwise, besides those cosmetic/outdated issues.

Thanks for any input you all can provide!

 Thank you for the info!

 Love this. What is the best way to get proof of deposited payments? Just bank statements showing rent payments (redacting non-related information, I assume)?

 Thanks, Chad. That info is good to know. What model mini-split do you recommend? The quote I received was for equipment and labor, and for a single-zone. I don’t know the brand/model he would use and I should have asked. 
For whatever brand/model you recommend, what is the cost of that mini? 

It's been 3 years since this post first originated and am wondering if opinions/thoughts have changed. I have a 4 unit property that has forced air heat but no a/c. My tenants just use window units for a/c. The property is in WI so 80-90 degree humid days for about 2 months out of the year, another 2 months are warm/hot but not as bad. 

I talked with an HVAC guy about mini-splits and he would charge $3500 per split. Ugg. So for 4 units that's $14k. He said since there is already forced air for the furnaces, he recommended central a/c, which is $4300. For 4 units, that's $17,200. Either way, I can't see the ROI on either of those options. (This HVAC guy did not recommend minis as he said they can go into disrepair in 3-5 years, as opposed to central a/c which lasts about 20 years.)

Does anyone have other thoughts? Is it really $3500 for a mini-split and installation? I will call other HVAC companies but I wanted to hear from the BP community as well.