If you’ve recently found yourself with a much higher home maintenance or renovation bill, don’t be shocked, it’s happening across the board. Obvious factors like COVID came into play with its significant decrease in manpower and overall lack of product/material production all in all equaling higher material and labor costs-much higher. For rental home investors, the timing couldn’t have been worse as most renters were now home full time inflating the maintenance requests to triple than years previous. But just like COVID19, there’s more than meets the eye and even more, trouble ahead was to come as we started off 2021.
Texas Froze Over
In February of 2021, a freak and unexpected freeze hit the state of Texas causing more damage than what was just reported on the news. Damage that unfortunately trickled down to something as simple as paint. Texas, the nations leading petroleum refining producer, was hit hard by the freeze leaving them unable to refine the necessary raw materials needed for paint, windows, and even vinyl siding. Results left major companies like Sherwin Williams suddenly faced with both labor shortages and higher basic material costs from suppliers. Nearly every brand of paint uses materials sourced from Texas leaving no one spared. Even big-box chains like Lowes and Home Depot have cleared of their shelves weeks ago as competition between home builders, independent contractors, and do-it-yourselfers continue to rise. Paint, like never before, is now a victim of the basic supply and demand model. And with demand increasing, rental investors should heed this warning- plan early. Many professionals are ordering paint that’s currently backlogged for several weeks and now stretching their appointment times out months. It’s also safe to note, paint can get old so that can from two years ago probably won’t match perfectly for touch-ups.
A Boat Thousands Of Miles Away
Trouble doesn’t stop there though. Thousands of miles away in March, one of the world’s largest cargo ships found itself stuck in the Suez Canal. Lars Jensen, a container-shipping expert from Denmark told NBC News “anything you see in the stores” will be affected. That especially goes for appliances. Much of the manufacturing parts were delayed causing a ripple effect down to the consumer. Delivery times for average kitchen appliances a year ago would take maybe two weeks, today in our own experience, you’re lucky to get a delivery window within two months. And to add even more difficulties, Electrolux, the Swedish Appliance Giant, and the world’s second-largest appliance maker, said in October of 2020 that they were seeing supply shortages despite higher production levels.
This could mean bad news for rental investors with older appliances. The increased use is hard to ignore. Think about the average amount of dishes you ran through your dishwasher when you were gone for 8+ hours a day and enjoyed one or two meals out. That all came to an immediate halt and dining out was no longer an option for close to a year for many. Coupled with the increased use, the constantly morphing world we live in today has always thrived on the idea of “out with the old, in with the new”. Just like those old bulky TVs, you can’t find replacement parts and if you do, it’s egregiously expensive. So much so, that you could just about pay for that new TV. Rental investors and homeowners should weigh out their options when figuring out the best way to handle appliances. While it might not be the most convenient, upgrading those appliances can certainly increase your home’s value.
Texas froze over and a ship got stuck on the other side of the world all after a pandemic and we’re feeling the effects. From shipping delays, material shortages, and overall lack of labor the average costs for even a simple job of touch-up painting have more than doubled. Finding even the most decent vendor available is tougher than ever, let alone at an affordable rate.