Having to paint a rental home is a basic and common task when it comes to operating a property as a rental property. A coat of fresh paint will make sure that the property’s condition is presented as best as possible and is a one of the Keys to Leasing Success. Does this mean that a property should fully be repainted every time there’s a vacancy? Far from it! Being able to keep painting costs down is a key to operating a profitable investment.
AVERAGE RESIDENCY & DEPRECIATION
The average resident renting a residential property will stay in the same rental home 3-4 years. Though sometimes residents will stay for shorter or longer periods of time, this is a key number to plan for as paint has a three-year depreciation schedule. What this means is that if a resident stays in a rental home for 3 years they cannot be charged for any repainting costs. Given that the average resident stays in a rental home for 3 years and that after 3 years a resident cannot be charged, it’s crucial to have a plan in place to approach the painting in a way that will help reduce costs.
TOUCH UP PAINT
A common phrase used when it comes to painting is doing Touch Up Paint. The idea behind this is grounded in saving money by not having to paint the entire property which makes sense. However, this phrase is not clearly defined therefore if you ask two painters or handymen you are bound to come up with someone saying that touch up is painting a small section quarter sized area and someone else can say it’s touching up a full wall from corner to corner. We prefer to clearly define this concept as follows:
Level 1: Cleaning Up Walls
Ideally, walls could be professionally cleaned and doing so save money in painting costs. You’ll be surprised what will come up walls if cleaned properly. The higher the sheen of paint the easier it will be for dirt, grease and grime to be cleaned.
Level 2: “Touch Up”
We define Touch Up as a section of up to 6” x 6”. There’s no right or wrong definition for touch up but this helps put into context that touch up paint should only be tried in small sections. A key to having this be a viable option is to make sure that an owner has all the information from the original paint applied which includes paint manufacturer, color code, sheen and specific product. Even when all these factors are known the paint may not match 100% and will stand out eliminating the desired outcome and it would be best to move onto the next level.
Level 3: Partial Wall & Full Walls
The next level is to partially paint a wall or paint a full wall from corner to corner. If a wall has several areas that need attention, then this is a good option to make sure that the wall looks as best as possible.
Level 4: Entire Property
The last option is to have to repaint the entire property. If this has to be done then one must make an important decision to Choose a Color Code & Sheen. The three surface areas that will be painted includes Ceilings, Millwork and Walls. Ideally, the ceilings and millwork will only need to be painted one time as ceilings rarely need to be repainted and millwork is easily wiped down as its usually painted with a semi-gloss sheen making it easy to clean. At the next vacancy, ideally the property can be brought up to a presentable condition with the other options of Level 1 – 3 without having to go to Level 4 of repainting the entire property.
STANDARD PRICING CHALLENGES
If painting is such a common task, then having Standard Pricing would be ideal. In the multi-family space (large apartment complexes) having standard pricing is standard practice. If you think about it, a 100-unit building may have four floor plans, then a vendor only needs to price out each floor plan based on square footage as every time it comes up it will be the same floorplan. The challenge for a property manager is that with residential properties (houses, condos and townhomes) there are several factors that make it hard to provide standard pricing when every property managed is not standard. Factors that play a role on pricing include the following:
Ceiling Heights: Does a property have low 7 ft. ceilings or do they have high 11 ft. ceilings. This will drastically change the surface area that must be painted. Does the living room have 20 ft. ceilings which need scaffolding? The price will increase.
Drywall Repairs: Two units can be identical. However, if one has clean walls ready for paint and one has nail holes, drywall anchor holes, etc. then the price will vary.
Vaulted Ceilings: This adds additional costs.
Accent Walls, Wallpaper & Stained Walls: All of these will add an extra layer of work and therefore additional costs.
Popcorn Ceilings: Is this an older property? Removing it is priced separately and painting it adds extra costs.
Sanding Millwork: Depending on the condition of the millwork and the previous paint used (water vs. oil) it may need an extra layer of work if sanding is required.
COMMON PRICING METHODS
While pricing can greatly vary based on the factors listed above and having standard pricing is difficult, the following are three separate common methods that we’ve found vendors use.
Method 1, By Wall: Vendors will commonly price out their labor costs for Level 3 as this level has more consistency from property to property. As an example, a vendor may base his Per Wall price based on an average bedroom wall dimensions of 12 ft. wide x 10 ft. tall knowing full well that sometimes the wall dimensions may be smaller or larger, but it allows a vendor to provide standard pricing. The following is an average sample pricing schedule from vendors we’ve worked with…
Method 2, By Square Foot: Though this method is harder for vendors to price out without seeing the property based on the challenges listed above, the following are some rules of thumb…
First Time: Paint everything and set the baseline. While costs will vary by vendor, a conservative rule of thumb is $3.50 / sq. ft. Here’s a quick overview:
1,000 sq ft: $3,500
1,500 sq ft: $5,250
2,000 sq ft: $7,000
Second Time+: Only walls… no ceiling, no closets, no millwork (crown molding, windows, baseboards, doors, etc.). While costs will vary by vendor, a conservative rule of thumb is $1.75 / sq. ft. Here’s a quick overview:
1,000 sq ft: $1,750
1,500 sq ft: $2,625
2,000 sq ft: $3,500
Method 3, By Vendor: The best way to obtain pricing is by having the vendor do a formal walk-through of the property to provide an accurate estimate. However, sometimes due to time conflicts this may not be ideal.
CONCLUSION
Following the approach shared above will ensure that the property is prepared as best as possible during The Turn Process. A property manager can perform a walk-through and advise as to how to best proceed to help keep costs down.
