Don’t Let Deferred Maintenance Be the Downfall of Your Investment
When money is tight as a homeowner or real estate investor, property maintenance can be the first “elastic” expense to fall off the budget list. Putting off maintenance, however, could end up costing you more than keeping up with a regular repair schedule. Deferred maintenance (DM) refers to maintenance that is overdue or postponed until the property owner has funds. Deferring property maintenance might seem like a quick way to create more room in your budget, when in reality it’s a common and potentially serious mistake. Avoid and address DM with the following tips to safeguard your investment.
The True Cost of Deferred Maintenance
You must understand the problem before you can come up with a solution. Deferred maintenance is the bad habit of falling behind with property maintenance, either planned or unplanned, to help a future budget cycle or due to gaps in your current available funds. Deferring maintenance is generally a precursor to a property’s physical deterioration, degradation, and the probability of asset failure. DM can cause decreased reliability, loss of system performance, increased frequency of breakdowns and repairs, tenant discomfort, aesthetic losses, diminished appliance life, increased ownership risk, and collateral damage.
Deferring maintenance doesn’t add to your profitability as a real estate owner. It simply leads to catch-up costs in the future. DM often doesn’t equal just what you would have spent on maintenance initially. Like interest on a loan, the actual price of deferred maintenance can snowball into much higher than the original price. Not only will you have to pay catch-up costs on the maintenance you missed – you will likely encounter property problems you would not have had with regular maintenance.
Some of the most common property repairs necessary after slacking on maintenance include plumbing repairs, leak repair, HVAC system cleaning, and exterior property fixes. Many systems in a standard home can’t function properly without regular inspections, cleanings, and minor repairs. Deferring maintenance can lead to clogged or burst pipes, appliance breakdowns, roof leaks, and other major and expensive property problems. In this way, DM can cost homeowners considerably more than staying on top of maintenance from the start.
How to Prevent Deferred Maintenance
Prevention is better than cure when it comes to deferring maintenance on properties you own. If you find yourself in a profit pickle, don’t choose maintenance as the first thing to go. Remind yourself that backlogged maintenance will end up costing you more – sometimes considerably more – in the long run. Instead, find funding for maintenance by solving problems relating to an inadequate budget.
Create a prioritization system that helps you balance the various needs of your property. Keep maintenance problems on your list of necessities, not luxury costs. List your critical needs, such as safety issues, first. Structural corrections might be the most expensive, but they’re the issues that can cost you thousands later if you defer them. Put projects like renovations lower down on the list, getting to them when you have the budget. Work with a professional contractor if you aren’t sure which maintenance tasks are high-priority.
Make regular property maintenance easy and affordable through a property management solution like Home365, which uses customer data and smart technology to keep track of property maintenance needs according to your budget. Home365 can help you understand your home repair projects, connect with cost-effective professionals in your area, and stay on top of home maintenance without breaking the bank. We can make deferred maintenance prevention rewarding and hassle-free.