I purchased a 5 unit apt complex. Four 2br/1ba and a studio. Next to the studio is a laundry room but I was thinking of removing it and make the studio bigger. Any thoughts on this? First time I own an apt building with a laundry room.
What is the revenue stream from the Laundry and how much additional rent would you expect to reap??
Keith
Although it depends on your local market and competition, everyone I know hates doing laundry in a common laundry room only about half as much as having to go to a laundromat to do laundry. Removing the laundry room may make it harder to rent you apartments. And, as kdhastedt noted, the laundry can be a nice additional source of revenue.
On-site laundry equipment is a value-added element for your tenants. This is a valuable profit center for you (if you own the equipment).
Meantime, you should NOT convert that space to living space for one tenant. You cannot possibly make more money doing ‘that.’
Meantime, we left our laundry open, and the neighbors washed all their clothes in our machines, instead of going to the commercial laundromat.
When we stopped allowing this at one location, our revenues dropped, but also complaints about the equipment being full all the time went away.
The solution: Added another washer and dryer.
One problem with having unsecured, unattached equipment is theft. The machines can be “flipped” (turned upside down and emptied of their cash).
That might be a small loss, except now the machines are all dented and fugly looking. So the machines need to be fastened to the floor and wall.
Securing the machines both prevents them from “walking” during use, and from being “flipped.”
So, keep the laundry room. Make it look nice and inviting; secure the machines to the walls/floors; and encourage the neighbors to ‘borrow’ your equipment.
FWIW
Like the others said, don’t remove the laundry room. The convenience is a selling point. If it’s a hassle, just raise the price. If you have a problem with vandalism, post a sign above the the washers and dryers that says “Coin boxes emptied daily.” That usually minimizes the problem.
Also, put a self locking commercial door handle on the self closing laundry room door (code requires a door closer if there isn’t one already) and give everyone a key so only tenants can get in there and charge a small deposit for the key so you get it back when they move out.
Another issues is if you remove the coin laundry machines, tenants might start adding pair into their apartment, which may mean illegal wiring setups and plumbing leaking into another apartment (with the tenants saying, oppps sorry, and having to deal with angry neighbor tenants replacing a ceiling and paying for the repairs out of your pocket–usually imo not worth the trouble pursuing the tenants for the damage).
Don’t waste your money altering rental properties. Save your money and avoid big capital expenditures like that as they suck up your cashflow, which you should be saving for things like the roof and boiler when they unexpectedly go. IMO you’ll never get your money back on these alterations.
Slap on a coat of semigloss white and touch up the floors and you’re good to go for the next tenant. Same goes with bathrooms and kitchens. Anything looks dated, lightly sand it and slap on a coat of glossy white oil based melamine and you’re good to go. Don’t waste your money changing things that are still functional–you’re just throwing good money down the toilet.
I suggest you keep it and leave it there it it doesn’t cause you any trouble, anyway, you’ll be needing it there someday.
I have a different take on having laundry for your 5-unit building.
Two-bedroom units house kids or grandma or someone in the extra bedroom. They need to do laundry! We all need to do laundry!
What about putting in laundry hookups in EACH unit? There is always room, heck, we put stacking washer/dryers in 350 Sq. Ft. studios. We put them in closets, in the corner of bedrooms, in kitchens, in dining rooms, in bathrooms. We put them in, always.
This should cost about $1000 per unit for plumbing and electrical upgrades. You can just do this slowly, as units come vacant. This will also inspire tenants to stay longer–“Can you believe that my landlord is going to give me a washer/dryer hookup? I was going to look for a new apartment, but now I’m going to extend for 2 years instead. I’m gonna get a washer, can you believe it?!”
You can amortize that grand in infrastructure cost over say, two years. Ask the tenant to pay an extra $50/month to not have to drag their dirty socks and chonies to the public laundromat every week.
What does a family have to spend per week at the laundromat anyway? That would be a good number to know. That would help determine what they can afford, and what you should increase the rent by.
You can even PUT IN washers and dryers, not just the hook-ups. They can be really inexpensive on Craig’s List or yard sales. We can get good ones here for around $100 a machine.
Washers and dryers seem to last a long time. We still have one Harvest Gold number still in use. Tenants think it charmingly vintage, and hey, a dryer is a dryer.
Let’s say you eventually have washers and dryers in all units. That’s $250 more rent coming in a month. That’s $3000 more a year. Your 5-unit building has a value that is directly correlated to the gross rents. You have now:
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Increased the value of the building.
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Increased the quality of the tenants.
Middle-class working tenants hate going to laundromats where all the lowest income locals hang out. I know that because I had to spend every darn Friday night at the laundromat when I was a single student parent. I had to catch a ride with my chain-smoking neighbor and her two grubby little kids. We all hung out there for about three hours until all the stuff got dried. This was EVERY FRIDAY NIGHT FOR THREE YEARS until I graduated. With my first paycheck I bought a clothesline and a used $50 washing machine. I then rented a house that I had the washer delivered to ONLY because it had a washer hookup in the basement. I moved out of my duplex apartment because IT HAD NO WASHER/DRYER HOOKUP and I had a little kid that went through several outfits a day. I didn’t have a car yet, but, by God, I got me a washing machine.
So you upper crust landlords who have never hung out in a low income laundromat for 3 hours every week, you just have no idea of how the quality of life can improve. With a washing machine!
A washer and dryer can elevate your tenant to the middle class. Then maybe they start acting more upscale–paying the rent on time, not driving in and out with loads of stinking clothes, etc.
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Increased lease terms. Who is going to leave their convenient in-unit washer and dryer for another apartment that doesn’t have those?
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Older, more stable tenants. Seniors who can’t easily get to the laundromat-- fixed incomes, arthritis, heart conditions and all that need their at home washer and dryer.
So yes, make that studio bigger too. Make it a 1-bedroom. Tuck in a stacking washer/dryer. Get a lot more rent. Upgrade, up scale, improve, and reap the reward of having life made better for your tenants. Whomever they may be.
Furnishedowner
great points!
randyscott