All Topics / Value Adding / Heat pump v electric heaters

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  • Profile photo of JBCJBC
    Join Date: 2014
    Post Count: 34

    I’ve had a bit of a look through other posts and couldn’t see a direct answer to this.

    For an IP, obviously heat pump costs me more upfront but is cheaper for the tenant to run than an electric heater. Would be good to keep the tenant’s bills down – I guess this would result in better tenants, renewed leases, less vacancy, perhaps a slightly higher rent. But is it worth the upfront cost?

    Any other factors, eg maintenance costs (I guess tenants could be slack on cleaning filters on heat pumps etc)?

    Any suggestions one way or the other would be appreciated, cheers.

    Profile photo of Corey BattCorey Batt
    Join Date: 2012
    Post Count: 1,010

    I very much doubt the tenants would even notice the type of HWS used.

    A couple years ago I got a call from one of my property managers saying the tenant had organised an electrician to fix their hot water service as it had stopped working and they’d let me know how much the bill was. I was quick to say I would not be paying the bill. Why?

    It was a gas hot water service.

    Pilot light had blown out – quick fix.

    • This reply was modified 6 years, 1 month ago by Profile photo of Corey Batt Corey Batt.

    Corey Batt | Precision Funding
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    Profile photo of JBCJBC
    Join Date: 2014
    Post Count: 34

    Thanks Corey,

    I’m talking about heating for inside the house (it’s in Tasmania).

    Heat pump quotes are about $2,300 – $2,600 installed. Electric is about $1,000.


    Profile photo of corynatorcorynator
    Join Date: 2015
    Post Count: 2

    Hi JBC,

    I’ve been looking at installing one of these heat pumps in my own home as the running costs are significantly less than a conventional hot water unit. After reading Steve’s books, might I suggest that if you do go through with the Heat Pump, you can speak with your tenant to let them know that running costs will be far less, therefore they will save in electrical costs, but you might add that you will have to increase the rent by $10 pw – so realistically your costs are covered in 5 years. I do also believe that the cost of the heat pump installed is tax deductible on an IP. Someone correct me if I’m wrong but I do also believe I’ve read this in Steve’s book.

    As for filters, make sure you’re on top of things and have them changed as required. Don’t leave it to your tenants.

    Hope this helped.

    *Edit: I feel like I wasn’t clear enough – but what I was getting at was that you’d make the tenant a whole lot happier by reducing their electricity bill, so you could negotiate an increased rental price to eventually cover the cost of the Heat Pump.

    • This reply was modified 6 years, 1 month ago by Profile photo of corynator corynator.
    Profile photo of freykartsfreykarts
    Join Date: 2020
    Post Count: 0

    Kind of outdated but still relevant. I can say that the installer of the electric heaters and heat pump actually knows it. If what could save more or less on the long run or not.


    Frey | professional electricians | Good luck!

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