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Old 02-28-11, 06:08 PM   #1
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Question Energy Efficiency Flat Rate Apartment Profits

I just had a hypothetical project idea and wanted to run it by you guys to get a gauge on the feasibility.

So here it is... I'm planning on buying on foreclosed short-sale properties that are in good structural condition here in Wisconsin. Somewhere around a 20% discount. Then rent them out at somewhere around a 5 year buy back. Now here's the twist. Drop some money on blown-in insulation for the attic and wall cavities, ~6in external EPS insulation (treated with fire retardant straight from Chinese manufacturer), and energy efficient windows (high cost but need to be replaced anyways from local amish) to roughly passivehaus standards. I have considerable construction experience so I can eliminate most of the labor costs. But I charge the renter a flat heating fee above the actual heating costs to pay back the improvements. (Renewable electricity is Electricity is high entropy so I don't think its worth it, plus waste electric heat will hep offset heating costs. Saving up for a ~$1000 IR camera to to avoid energy consultant costs (who needs them anyways ). On the upside labor and consulting costs are negated, it's self financing, and provides renters and myself energy security...

Any glaringly obvious areas I'm missing here?

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Old 04-17-11, 09:03 PM   #2
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Sounds like a good plan but I think there is one thing you have not thought about...

What do you do when a renter goes to the utility company to find out what the average costs have been and confront you about why you are charging them so much?
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Old 04-18-11, 04:14 PM   #3
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Why would the renter check on utility costs if the utilities are included in rent?
I think it sounds like a good idea, if all land lords thought about long term instead of short term then everyone would be doing this.

Ryland is offline   Reply With Quote

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