Lease or own appliances: Which should your condo association choose?
Know what you’re getting into after you purchase washers and dryers
Paying for major appliances can be as much of a headache as paying for a new laptop or smartphone. When it’s shiny and new, it seems like the best purchase. You have all the bells and whistles, and it’s efficient enough to do the job. But a year later, there’s a bigger, better and badder version of the same product. It’s one of many reasons why condo associations choose to lease appliances instead of buying their own.
Leasing appliances from companies like Coinmach (under CSC ServiceWorks) will help your building get high-quality equipment with free service and maintenance for the entirety of the lease. For a specified monthly rate, the products can be delivered the next day and be available for use. However, if you’ve ever leased anything, you’re aware that the amount of money spent on leasing appliances could’ve paid them off altogether. For example, let’s say you pay $30 per month for a washer and dryer set. That’s $360 for a year. Meanwhile that’s almost half the price of a low-priced washer-dryer set from Best Buy or Sears. Is it worth it? Or, would you rather own it outright?
No one can answer that question but your building owners and board members. However, there are some factors board members specifically should consider before purchasing appliances permanently.
Who is going to handle coin management? Whether you have a group who does it or assign a designated person, someone has to be held responsible for issuing refunds and counting coins on a scheduled basis. For a building of 20, a quarterly count will do. But who will be in charge of refunds now? With a leasing company, owners and tenants can fill out an online form for a Refund Request. (They also wait anywhere from one to three weeks to receive that $1-$1.25.) If the board purchases equipment, it’s up to them or the property management company to distribute these refunds. And if neither live in the building, this can become a bit of a nuisance to manage. There needs to be some kind of system set-up (even if it’s just a specific email address) for residents to request refunds and identify each machine. (Labeling the machines by letter is easy enough to do. Don’t expect residents to jot down serial numbers and model numbers each time a machine malfunctions or eats their money. Soon after the machines are purchased, keep those number combinations on file in a safe place and affiliate each machine with a letter. This’ll stop board members or property managers from having to revisit the machines every time there is a repair needed.)
What is the return policy on faulty machines? I have never seen a machine fail quite as fast as Speed Queen machines. As an owner, I was first impressed by our brand new machines. But within a matter of months, these machines were as unpredictable as Asurion insurance. Almost every possible repair job needed for these washers and dryers happened, and there was nothing the prior board could do. The return policy was 30 days. Before you purchase machines, research prior reviews and complaints about the brand. Because if you buy the appliance through a third party, their goal is to make the sale; whether the machine has longevity is a toss-up.
Is there someone who can be available for repair specialists to enter the building? As with many contractors, you may be given a window of time for repairs to be completed. This means someone needs to be around to open front entrance doors or basement doors to allow the technician to do his job. For board members who work 9–5 jobs or live away from the facility, this can become frustrating after a while. Even for work-from-home board members, it can be overwhelming if the machines are constantly failing. One suggested way to make it easier for all board members is to invest in a key lock box, so technicians can get in and out of necessary doors without board members having to stay home to wait on them.
Do you have all necessary warranties? It may seem like a lot of money to pay for extended service warranties on top of supplies. After all, maybe you know a local appliance repair person who can do it cheaper. But before you opt out of this service option and just rely on a manufacturer’s warranty and supply coverage, remember that it’s not just you using these appliances. If your building has 20 residents, that doesn’t even mean 20 people are using the machine. Their family members, significant others and child(ren) may be tasked with doing laundry. So if half are married or living with someone, that’s at least 30 people using the machines. Imagine 30 people driving your car. Do you expect it to look like you’re the only one behind the wheel?
Now add on the $20 per hour rate that the technician will charge. Would you rather pay a flat rate of $400 for a four-year warranty for each machine (total of $2,400 for unlimited repairs and supplies on a set of six) or cross your fingers and hope you don’t pay that much within one year? (All it would take is a couple of machines malfunctioning each month. For a one-hour job, that’s $20 x 2 machines = $40 per month, or $480 per year. That same four years could cost your board $1,920 — not including supplies.)
Do you want to pay for a coin count? As mentioned previously, coin counts will be necessary. (Without them, you’ll have a lot of jammed machines.) If you have a team (or a person) who has a couple hours to count coins, this should go fairly quickly. (I’ve done it three times. Expect it to take anywhere from 1–2 hours for one individual to count $300 to $400.) You could also use a coin-collecting machine found in retail stores (or banks) and pay an 11.9 percent coin processing fee. (It can be free if you choose an eGift Card to approximately 20 stores and restaurants, which probably won’t be useful to your building unless the next board meeting is held here.) So expect to pay $35.70 for $300 in quarters, and so on and so forth. Is paying for your money worth it? I’d say no, but I also can afford to count quarters for a couple of hours. Others may not.
If you’ve discussed all of these day-to-day board tasks and still want to own appliances, go for it. But these are non-negotiable once the machine arrives, so buy (or lease) with care.
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