Condo owners & hot water tanks – A call to arms!

[photopress:water.jpg,thumb,alignright]A lot of people worry about George Bush and political issues. Many more worry about saving the trees and global warming. I worry about condo owners and their hot water tanks.

I am buying a new hot water tank for the seller and buyer of the condo I have in escrow. When I sold the condo to the current owner/seller, the hot water tank was 14 years old. I bought him a home warranty at the time and a new coil was put in, during the first year that he owned the condo, by the warranty company. Now that I’m selling it for him, I’ve decided to have the tank replaced for the new owner (who is not my client).

Hot water tanks are one of those things that often slips through the cracks in a normal transaction. A home inspector often cannot tell if a hot water tank is “ready to blow” simply by looking at it, unless it is already leaking and corroded. A warranty company comes in and “fixes” it, but often doesn’t replace it until “it blows”. The main reason to replace a hot water tank is due to its current age, which is “past it’s life expectancy”, and not wait until “it blows”. However, in the normal real estate transaction, if it ain’t broke, no one is obligated to fix it. “Past its life expectancy” alone, is not necessarily “a defect that the seller must repair”. Old is not necessarily defective.

When I became a Realtor many moons ago, it was our charge to “uphold the value of real estate” generally. The Realtor motto has changed since then, and I am not currently a Realtor, but that motto is still my “cause of action” and it calls me to replace hot water tanks. We all need a mission in life, and so I have made this one of mine. Why you say?

Because when a hot water tank blows in a condo, it affects everyone. When FORTY GALLONS of water lets loose, while the owner is off at work, it is a chaotic catastrophe! The owner comes home to wade in water that has turned his condo into an indoor swimming pool. The next door neighbor comes home to find water all over her condo, but can’t find the source of the problem. And if it is not a ground floor unit, the people below are getting rained on. If any one of these affected neighbors doesn’t respond appropriately, because “they only got a little water, so they just let it dry out on its own”, you can have the beginnings of mold growing behind the baseboards and under the carpet. If you have a 90 unit complex that is 14 years old, you can potentially have 90 hot water tanks all ready to blow in sequence, over a 2 to 4 year period! One blown tank after another! Water, water everywhere! So it is my mission to replace these tanks before they affect people’s lives adversely. Before there are so many “water intrusion” insurance claims that the HOA loses its condo insurance, or the insurance rates are so high, to keep their insurance, that the HOA dues skyrocket! The ramifications of blown hot water tanks, in succession in a condo complex, can raise everyone’s HOA dues and negatively impact the value of everyone’s condo. So to “uphold the value of real estate”, generally…I’ve got to tackle these old tanks at every given opportunity, one sale at a time. Out with the OLD and in with the NEW!

That being said, if anyone has recently replaced their hot water tank, and can give me a referral to a reasonable and reputable source of hot water tank replacement in the Seattle area…please speak up and join me in this cause to eradicate water intrusion claims. Many “forward thinking” HOA Boards are making a rule, that all hot water tanks be replaced based on age alone, and are monitoring that every owner replaces their tank before it blows on everyone. If you live in a condo complex, especially a “stacked unit” complex, please heed this warning, go to your condo board meeting, and urge them to take a stand against water intrusion caused by hot water tank failure. Being “forewarned is to be forearmed!”

Thank you.

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About ARDELL

ARDELL is a Managing Broker with Better Properties METRO King County. ARDELL was named one of the Most Influential Real Estate Bloggers in the U.S. by Inman News and has 33+ years experience in Real Estate up and down both Coasts, representing both buyers and sellers of homes in Seattle and on The Eastside. email: ardelld@gmail.com cell: 206-910-1000

32 thoughts on “Condo owners & hot water tanks – A call to arms!

  1. Do you have any info on tankless water heaters?? That may be an alternative (a more expensive one albeit) to 40 gallon’s of water hitting floor and causing loads of damage.

    I’m having a home built and I’m checking into them myself but don’t all that much at this point.

    Just a thought.

  2. Tankless water heaters are a good option, especially for condos with limited space. But they have different exhaust requirements (usually they require a direct vent to the outside), which makes them fairly hard to retrofit.

    I’d recommend Ballard Natural Gas – they can do an inspection on the water heater and see if it’s “ready to blow” (or not) and they also offer replacements from a couple national manufacturers. They’ve taken care of my furnace for years and I’m very happy with them.

  3. Forgot to add – Ardell is right on about the problems with water tanks and condos. A family friend owned a condo that was uninhabitable for almost a year because of a plumbing problem in a neighbor’s unit. The condo board kept wanting to use unlicensed contractors, refused to finish the job when an inspection showed more mold, etc.

  4. Todd,

    I have a tankless water heater in my home amd I have to say that I’m not terribly impressed. It was installed when the home was built, and it was not done properly, in that, this system also provides the hydronic heat for the house. There was no backflow valve installed between the water lines that serve the heat and the household taps. This resulted in sudden, cold water for minutes on end coming through during a shower, for example. I was able to get the builder to fix it, but it took about a year, which was no fun. Another issue you may see is that they are slow to deliver hot water, wasting ALOT down the drain while waiting for it. These systems also require a specific amount of volume or draw through the lines to kick on the burner, so you may have to turn the faucet all the way up to get the temp you want and keep it high enough to maintain a steady supply of hot water. If I had a choice, I’d put a regular hot water heater in my home vs. this system…its just been to wasteful and too much hassle. For you avid bloggers out there interested in the Issaquah area, my team has a new real estate blog well – http://tk2blog.blogspot.com

  5. At the last condo complex I lived in here in Maine, new water heaters were required every eight years, whether they “needed” to be replaced or not. Unit owners who did not replace on schedule were held completely liable in case of failure and damage to other units.

    I am surprised that the assocations you describe are not mandating replacement. They would be wise to adopt similar policies!

  6. I bought a condo 6 months ago, and the inspector said to replace the 18 year old water heater. I did, and was shocked to find out how expensive it was to bring everything up to code — earthquake straps, drip pans and I can’t remember what all. It almost doubled the cost of replacing the heater.

  7. Thanks for all the comments so far. Inspectors are recommending tankless ones, but I haven’t seen them yet.

    Funny thing is when I had hot water off the boiler with no tank, back in PA, and so did many others that operated kind of like the new tankless systems, all the inspectors recommended getting a tank!

    The pendulum just keeps swinging…

  8. Carrie, How much was it? Straps and pans shouldn’t add much to the cost.

    I did some research awhile back and found there is virtually no difference from one manufacturer of tanks to another, so type of tank becomes somewhat irrelevant. I only worry that it be a very competent installer who knows how to shut off the water in a complex to install it. Single family homes is easier, I would think.

  9. Let’s see — I also needed the expansion tank, some anti-gravity thing because the heater’s on the 2nd floor of a townhouse, something about it needing to be grounded in a different way. And a couple more things. I can’t remember all the details and I can’t seem to find the paperwork from the installer.

    It all added up to about $400. I talked at length with the installer and did my own research and it did seem to be things required by new codes in the Uniform Plumbing Code, or whatever it’s called. I do remember the back side of the receipt from the installer was a reprint of current code requirements.

    I don’t know — maybe I got taken. The heater was purchased from a major department store in Seattle, and I spoke with and emailed various higher-ups in the company afterwards, suggesting that they warn customers of the likelihood of needing some updating to meet current codes.

  10. The extras were $400. The heater and “standard” installation were about $500, I think. So, $900 all told.

    It could be worse. Friends bought a house last year and shortly after they moved in found they needed major plumbing repairs, about $3,500 worth.

  11. Well I’ve finally gotten around to the task on my list “check the hot water heater”
    can of worms so far, but an interesting adventure:
    I live in a condo. no gas. all electric. so we won’t have the venting issue if we switch to tankless. the bigger hurdle that I can see just from internet searching today is not having enough AC circuits. I looked at the circuit breaker and it appears we have one devoted to ‘water heater’. to get a tankless that will be at least as good as what we have, it seems we need a lot more juice (at least 2 circuits, and probably 3 to be on par with what we’re used to). so ‘plug and play’ is not an option using a whole house tankless. The other option I’m seeing is installing ‘point of use’ tankless. unfortunately this seems like a lot more work – 2 showers, 3 sinks, 2 washers.

    maybe if i can find a whole house tankless that uses 1 circuit and we’ll just adapt. or we replace using an old school heater, and wait for the technology to catch up for the next replacement.

  12. We just got around to replacing ours from Sears and Fast Water Heater. This is what it all added up to:

    $330 for the water heater itself
    $170 for an expansion tank
    $120 for a vacuum breaker
    $60 for a drain pan
    $239 for a basic installation and haulaway
    $74 for earthquake belts
    $30 for a permit
    $56 for bringing the heater up 16 stairs
    $83 in taxes

    for a total of $1150 or thereabouts

    This type of cost where installation adds up to twice the cost of the tank itself is a real disincentive to performing preventive replacements.

  13. I am on the board of our HOA. We have been struggling with the decision to require mandatory replacement of water heaters for every unit. Having experienced how much the costs can be, I do not believe the board can either require or enforce replacement in all units.

    Having said that we’ll consider raising the insurance deductible for our HOA to $20,000 or $30,000 as the HOA has sufficient reserves. That will ensure that all all water damage claims are paid for by unit owners and do not impact the HOA.

  14. AJ,

    That doesn’t sound like a great way to go. I live in Kirkland. Give me a call some time. I used to manage HOAs and would be happy to go through some “what ifs” with you.

  15. Talking to the inspector, it looks like I was taken for a ride. The vacuum breaker and drain pan was not necessary to pass inspection in Kirkland.

  16. “the inspector” of what? I don’t think the hot water tank installers are saying all of the bells and whistles are “required’ everywhere. They simply, by policy, seem to have their own requirements that have more than doubled the cost of putting in a hot water tank in a short period of time.

    You didn’t up your deductible to $30,000 did you? Has your building had any tanks blow and cause damage to other units?

  17. To AJ…I;m a long time condo manager (since 1980) and I assure you that HOA Boards have the authority to require replacements of hot water tanks. The HOA’s highest duty is to protect the property.

    Also, You cannot raise the HOA deductible to $20,000 or $30,000 as $10,000 is the high limit based on the Washington State Condominium Act. And whe you have had a $60,000 bill from a tank break on the third floor, $10,000 does nothing. Oh, and when the HOA does make a claim for the cost, it raises everyones future premiums! Far easier to replace those tanks.

    Now, have you required braided steel mesh hoses for the hot and cold supply to the washing machine (rather than rubber) as a good condo Board member?

    • I am a COA board member. We require condo owners to provide proof of a valid, unexpired, hot water tank warranty. Warranties run from the date of tank manufacture. Most owners had six year warranties and so for the first year the rule was in effect, over twenty owners had to replace their hot water tanks. For those that fought the rule, we fined them into compliance.
      I hated taking this approach as several owners were on fixed incomes, but the condos are over 39 years old with one hot water heater made in 1998.
      We were begging for water damage and owners are responsible for damage from a failed hot water tank.

      • I don’t blame you Tony. I recently ran into a couple of water tanks failing in condos and they do a lot of damage. A lot more than the cost of a new tank. Hopefully people will know to buy one with a longer than 6 year warranty when they buy a replacement.

  18. I am the owner of AAA Water Heaters (aaawaterheaters.com). Every city has different rules and regulations about installing water heaters. The city of Seattle plumbing inspector has informed me that he does not need a permit pulled for a water heater replacement if I am installing like for like.
    Electric water heaters on average last 8-12 years. If you are in this block of time, you need a new water heater!
    I install a Rheem 50 gallon standard electric water heater for
    $529 +tax. That includes installation, supply lines and removal of the old one.
    I will also come out answer questions at board meetings.

  19. Thanks for popping by Bob. That’s an excellent cost for a 50 gallon Rheem.

    While I haven’t seen too many people replacing tanks at 8 years, a lot depends on the location in the home.

    How much is it to replace a gas hot waterheater? Isn’t the life expectancy longer on a gas tank vs. an electric one?

    Does it matter if it is in the basement or not as to cost?? I have one in the basement and one upstairs in my closet that feeds the master bathroom. Both look to be at least 50 gallon and possibly 50 gallon tanks. I’ll have to look at the tags. I likely will be replacing them when I sell my house so the new owners have new ones, in a few months.

  20. Thanks for popping by Bob. That’s an excellent cost for a 50 gallon Rheem.

    While I haven’t seen too many people replacing tanks at 8 years, a lot depends on the location in the home.

    How much is it to replace a gas hot waterheater? Isn’t the life expectancy longer on a gas tank vs. an electric one?

    Does it matter if it is in the basement or not as to cost?? I have one in the basement and one upstairs in my closet that feeds the master bathroom. Both look to be at least 50 gallon and possibly 50 gallon tanks. I’ll have to look at the tags. I likely will be replacing them when I sell my house so the new owners have new ones, in a few months.

  21. Ardell,
    yes, a gas water heater lasts about 10-14 years. It is true what they say, things arent built like they used to be made. My parents water heater lasted 35 years. I replace 50 gallon gas water heaters for $649 +tax. Stairs do add an extra body to carry the water heater up and down. It is an additional $100 for a second man. Check out my website at aaawaterheaters.com and give me a call if you have any further questions.

  22. Can you tell me if a condo requires an expansion tank ( balloon)
    We considering buying a condo, the hot water heater was new and did not have the expansion tank. The seller said it was not required because it was a condo and because it was in the closet. Did not seem true.
    Is this true?

  23. Rhonda,

    Here’s a quote from the King County site. Not sure if you are buying a condo in King County WA, but since you are asking me this question, I will assume you are.

    “Expansion tanks: If your water is on a closed system (the water can flow into your building but not out), an expansion tank or other approved thermal expansion device must be installed on your water system. The expansion tank is to hold water that can’t be held in the water heater after it expands when it gets hot. If there were no expansion tank, the hot water would be released through the pressure relief valve.”

    Note it reads “system” and not “tank” and it’s possible that the condo building’s water “system” has another method that is not individual expansion tanks in each unit at each tank. I would contact the HOA Manager and/or the person who installed it so they can explain why it may not be required in your particular instance.

    It’s possible, but I would check into it a bit further. The HOA Boards have gotten particularly vigilant about hot water tank issues, and rightly so. I’m sure you can get better and specific answers for that exact condo building and unit. There could be differences from one to another.

  24. Hi Ardell,

    I am a consultant who provides services around safety, emergency planning & disaster preparedness. I have a potential client that is a property management group for some condominium units in Seattle. They are trying to develop Emergency Response Policies around water heater failures. Apparently, they have had 4 incidents in the past couple of months.

    I recognize that the best mitigation strategy would be to require condominium owners to replace the water heaters as they reach their anticipated expiration date, some time around 10 years. I would anticipate that this would alleviate the greatest risk, however there is still some risk and if a water intrusion event occurs, what should the response plan be? If you know of any resources, my client, the condominium owners and I would be very appreciative.

    Thank you,

    Kelly

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