You aren’t obligated to have a washer and dryer in your rental property. What if they were an investment that could make your property more competitive and increase ROI? There are rental investors across the nation and in eastern Idaho that see washer and dryer sets as moneymakers.
Because you’re running a rental business, it’s important to know what the competition is doing like any other business. There are a noticeable percentage of rental units that have in unit laundry. If you might be considering a washer and dryer in your rental unit, read on. I went shopping for you.
What’s Your Competition Doing?
A search on Trulia showed that in the Idaho Falls market, 40.3% of all advertised rentals were offering in unit laundry. Eighty two percent of the rental offerings in Pocatello offered them also. Another look on Trulia showed that in some areas of the nation, a premium was being charged for in-unit washers and dryers. Those two factors would suggest a noticeable number of investors have seen positive results in offering in unit laundry. A 300 unit complex in Salt Lake spent over $400,000 on in-unit washers and dryers. Making an additional fifty to seventy five dollars a month in per unit rent with them was part of their business plan. That’s $13,500 to $20,250 a month at 90% occupancy which is a reasonable expectation in Salt Lake.
Tenant Owned Laundry Sets Can Cost You
Another consideration is damage to your rental investment from people moving a washer and dryer in and out. It doesn’t seem like a good idea to have a tenant banging their way through your rental with something as big and heavy as a washing machine. This was another reason the above mentioned complex was equipped with washers and dryers. They don’t want the damage.
Why Let Them Do That?
You wouldn’t allow a tenant to perform any kind of plumbing repair. Who knows if a tenant is qualified to install a washer? Will they properly level the unit, and use serviceable supply hoses and gaskets? If not, how much noise is that machine going to make when it hits the spin cycle and starts shaking and bouncing on the floor? People in adjacent units aren’t going to be happy with this. Finally, you don’t know what condition the renter’s machine is in. Is it on the verge of a leak that could damage your flooring?
No one wants to add complexity or cost to a rental unit. But, after looking at the above, it makes sense to consider in-unit laundry and to find out what the best choice would be for machines. Especially when you consider that, either way, if there are laundry hook-ups in your rental, there will be a washer and dryer in there. They may as well be solid units that are correctly installed. Units that are already there can’t damage the drywall and they are a potential additional source of ROI.
Shopping for a laundry set is a major hassle. The appliance market is flooded with brands. Here’s a list of appliance brand names I got from Sarah’s appliance repair plus Speed Queen.
I’m sure there are more out there.
Durability Comes First In A Rental
What made sifting through the pile a little easier was deciding on what makes a good washer for a rental. First, it has to be durable. If the thing doesn’t work, it’s worthless. In addition, if a device is supplied in a rental and it stops operating, the property manager or owner is going to get a call. No one wants calls. It’s supposed to be a passive investing experience.
Better Washes – In The Landfill
We all like our technology rich devices. They do a lot. The enhancements that technology brings to washers have real benefits. The new front loader washers; use less water, soap and electricity. Also, repeatedly in tests they do a better job of getting clothes clean than top loaders. However for some reason, they don’t seem to have the longevity that top loaders have. A trip to a the Jefferson county landfill will reveal rows of newer dead appliances. Add to that when a front loader needs to be serviced it’s going to be more expensive to repair.
Real World Reviews With A Wallet
If one researches washers an interesting contradiction comes up repeatedly. Test results will say over and over that front loaders are better. However, statistics show that people are going back to top loaders. In 2009 forty five percent of washers sold were front loaders. As of August of 2020 only twenty nine point five percent of washers sold were front loaders. It would seem a lot of people feel burned by their experiences with front load washers.
A Top Loader Design Is Not a Guarantee
If what you want in your rental is a washing machine that’s as trouble free as possible over the long run, all indications are that a front loader isn’t your best choice. While buying a top loader is no guarantee of longevity it seems to better the odds.
A poorly designed and cheaply made top loader can be just as big of a potential pain as a front loader. What makes any device more trouble free is rugged design that’s been manufactured for a long time.
Somebody Has To Fix It
Even a well designed and manufactured washer will need locally available service. This is especially important when when it’s under warranty. The best machine in the world isn’t worth anything if there isn’t service behind the sale.
An example is the Whirlpool WTW4855HW. It’s an old fashioned top loader with dials that’s about $550. It’s cheap to fix also. It would be great except I couldn’t find anybody who was warranty certified for it in Idaho Falls. When I went to Whirlpool’s website the next available service date was almost a month away. That’s unacceptable. Tenants want to be able to use their appliance, and you want the problem out of your hair, now.
Commercial Or Not Quite?
It would seem a near commercial washing machine would offer the best service for the money. This means a machine who’s calling card is durability, not features, and is available from common retailers. I was concerned that once one crossed over into the commercial arena the prices would go over the top.
Centering on Maytag and Speed Queen made sense as they both produce commercial (coin-op) machines for laundromats. Because it’s possible a commercial machine might work, I decided it should be looked into. If nothing else I would know that I left no stone unturned.
I went to the Maytag commercial website and they don’t list a phone number. That wasn’t impressive. If I want answers about an expensive purchase, the manufacturer should have the grace to answer the phone. I talked to a sales rep for a Maytag commercial distributor in Salt Lake and he said they don’t go into homes and each distributor was free to do with their business as they please. They were happy to set up laundry rooms, but no in unit setups. Rather than compromise and buy a retail unit, it’s better to work with a company that understands your business and wants to make you more money. Read on.
Speed Queen Commercial
In an effort to be complete I called the Speed Queen factory in Ripon Wisconsin to get more information. I was then hooked up with a commercial Speed Queen distributor in Salt Lake. A human being answered the phone at Evans commercial laundry equipment. I had a salesperson on the phone by the next day.
Brandon, at Evans, stated that selling machines for use in rentals is common for them. He said that the biggest reason for the investment was the increase in ROI. The secondary benefit is not having washing machines of questionable repair moved in and out, and the reduced exposure to possible water damage.
He went on to say that because of the reliability of the commercial units, they not only paid for themselves, they were a profitable investment. With increased monthly rents, the machines can make money. If an investor wants a truly hassle free experience, they can change out the machines every ten years. The expected trouble free use is 12 years. This is because of an overbuilt drivetrain, a stainless steel inner tub and a porcelain coated steel outer tub. Speed Queen exports to countries that have potentially damaging power supplies. Therefore, their internal circuitry is designed to take a hit when power outages occur.
The machines will still have a lot of life left in them at ten years. This means they can be sold instead of junked and the money can be reinvested in new machines.
Even Warrantied In A Rental
Speed Queen offers a warranty on these machines for rental use. The warranty is 3 years on parts, 5 years on the transmission, and 5 years on corrosion. The warranty isn’t voided if a local repair shop works on them or if the owner does.
Lasts Longer For About The Same Money
The big surprise is this. A commercial Speed Queen washer and dryer set are no more, and frequently less expensive than machines you’ll find at an appliance store or a big box store.
I don’t mean to sound like a Speed Queen fanboy. However, I’ve brought you down the path with me and this is where the trail led. All indications were that there would be a tie between Maytag and Speed Queen’s retail commercial units. It seemed that these were both commercial quality units tamed down for a home.
For Rentals: Go Commercial Or Go Home
What changed my outlook was finding out that Evans laundry equipment was in the rental market. Brandon used the term ROI before I had a chance to. Evans wants landlords and property managers to make money with a trouble free experience. The Speed Queen product has been proven for decades and is designed and constructed to be a workhorse. There aren’t innumerous cycles and features on them like wifi connectivity.
Maytag corporate wasn’t available and the Maytag regional distributor wasn’t interested. Most of the other brands of washers and dryers are feature laden devices that simply will not perform over the long term and make an investor money.
Add to these findings Consumer Reports listed Speed Queen as the most reliable appliance brand.
That’s My Story And I’m Stickin’ To It
Here’s some food for thought. Washers and dryers can be money makers. If you choose to invest in them, get machines that will give you the longest trouble free service possible. Reliable service usually means fewer features and a proven design. Are Speed Queen’s commercial washer and dryer the best for your rental? Answer that for yourself by trying to find a washer and dryer that are better suited to adding to your ROI and your passive investment experience.
To learn more about how Jacob Grant can improve your Passive ROI by answering your questions, call 208-795-8218 or schedule a call Schedule call