When Should You Replace the Roof on a Rental Property?

When should you replace a
roof on a rental property? Let’s dive into today’s video. Hi there. I’m Clayton Morris, longtime
real estate investor and founder of Morris Invest. Today we’re going to talk about
roofs on rental properties. It’s a huge expense
that you probably don’t want to have to deal with
unless you absolutely have to. Now, in one of my other videos,
I talk about the five key areas where you want to make sure you
have rock solid repairs done on the property so you can
protect your overall investment and mitigate those repairs. You can click on that video
here in a little card that’s going to pop up, or in
the description below. But in this video,
specifically, I want to talk about the one area,
the roof, and how do you know? Well first of all, unless
you are a roof repair expert, you’re not going to know. So that’s why it’s very
important for your property management team or
your maintenance team to check the life of your roof
once or even twice a year. Preferably when it’s
not icy up there, so they can get up on
the roof and check it. What are they going to look for? They’re going to look
for discoloration in some of the tiles– some of the shingles. What that means is that there
might be like a mold colony living underneath there and
water is getting through there, and is maybe making
it a weird color. There might be mold on the roof
because maybe the sun is not hitting it at the right place. That means it could
be extra wet and it may need to have some
replacement done because water might be getting in. Maybe there are
missing shingles. Maybe there was a big
thunderstorm, a big windstorm and it blew off some shingles. OK. That may need repairing. There may be some
sagging, right? That might mean that
some of the sub roof, the actual roof underneath
the shingles, is sagging and that needs to be replaced. They’re also going to
get up in the attic and look and see if
they can see holes coming through or daylight. I actually had that on
my primary residence not too long ago. We were having water
dripping into our bathroom because there was a
hole right in the roof. So we actually had to have
that section of the roof– a new piece of plywood put down,
the waterproofing, and then the new shingles put down. So let’s just assume you have
a new roof on the property and, under the tax law,
you’re able to depreciate the value of that roof
under the new tax code. It’s called cost segregation. We have a whole video
on depreciation, so don’t worry about it now. But the IRS basically
says 27.5 years. That’s typically
the life of a roof. So a 30-year– you always
hear the term 30-year roof thrown around. So when we put on a
new roof on the house, you should expect it to
last roughly 30 years. Now, there are things you’re
going to look out for, like I mentioned, what a good
roofing company will do and get up there and check out. So when should you
replace the whole roof? Well, if you need– let’s
say the roof is really old, number one. So you know that it’s
been put on 25 years ago. That’s probably a
good rule of thumb you’re going to probably need
to replace the whole roof. They’re going to look and see
if there’s sagging and problems all around the roof. So missing shingles,
sagging, holes. That’s a clear sign you need
to replace the whole roof. If it just needs
repairs, then you may be able to get away
with certain sections. And when do you know if you
need to just repair the roof? Well, if the roof’s not old. Maybe it was only five
years old, or 10 years old. And chances are it’s still got
another 20 years of life in it. No need to waste your
money on a whole new roof. So there may just need
to be put a few shingles, and those are very
inexpensive for your roofer to get up there and put
a few shingles down. Maybe they need to patch a
particular area because it gets more sun exposure. So some of those factors. There may be water getting
through a certain area and they need to replace
what’s underneath the shingles, the weatherproofing, and
then put down new shingles. So be careful before
you splurge and want to buy a whole new roof. Now let me talk to
you about overlays versus digging up and actually
ripping off the old layer. Most states will
allow you to put up to three layers of shingles. So you’ll see this on
a lot of older houses. You’ll see one layer that
was there in the 1940s, and then maybe in the 1960s
they put another layer, and maybe in the 90s
they put a third layer. In that situation,
you’re probably going to scrape all of that
off, rip off the old plywood, and put down all new wood,
and put down new shingles. Now that could be the most
costly roof replacement that you could think of. If, however, there’s
one layer of shingles and the sub roof is fine–
they go up in the attic and they noticed that
the plywood is fine, there’s no gaping
holes coming through, then we can do what’s
called a roof overlay. So we can add a whole layer
over top of that existing layer, and in 30 years we
could do that again. So check with, obviously, your
building code enforcement, and check with your
roofing companies. They’ll be able to tell you
how many layers your state lets you get away with. Well that’s really honestly
how you know whether or not you need to replace your roof. Check with a professional or
your property management team probably has somebody
on staff that will check that, especially
after thunderstorms or during the spring
and the fall– to get up there and check
the vitality and the health and wellness of your roof. Again, click on the
videos in the description below because we have a whole
series on what types of repairs you should do a rental property
to really make it rock solid and to protect it
against having to do major repairs and
costly things like that. I’m Clayton Morris. Thank you so much
for subscribing. If you’re not
already a subscriber, click the big Subscribe
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multiple times a week in our attempt to help you
become a better real estate investor. Go out there, take action,
and create cash flow. We’ll see you next
time, everyone.

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