Repairing vs Replacing Older Common Area Items

What is your philosophy on repairing vs replacing older expensive common area items that are accounted for in a reserve study?

For example, for those of you who have a clubhouse with an HVAC system and the system normally lasts 15 years; if you are on year 22 with the same system, do you continue to repair it as needed or buy a new system?

I agree with Tim. You have to weigh the cost of continuing to repair vs. buying new. Some other things to consider:

* How reliable is the old system? How easy is it to find people who can service it? In other words, are HVAC repair crews like young car mechanics who've never seen a carburetor?

* Something I've observed with stuff like appliances: the old things often keep going and going and going, and the new stuff seems to be designed to break down on schedule. In other words, the newer systems may be of lower quality.

* On the other hand, HVAC systems in general have become more efficient over the years, and the cost to operate them can be lower. So you have to also weigh the savings that you may get with a new system.

Not an easy or obvious decision. On the other hand, I also don't think there's a wrong answer. People will gripe about the current system going out without warning, and they will also gripe about paying for a new one. That doesn't mean you've made the wrong decision.

What Tim and Cathy said.

Cathy's also right about the longevity of many items. Years ago I had to replace my furnace (got the work done shortly before a nasty cold snap). The contractor noted I still had the original equipment - the townhouse was built in 1978 and I replaced in the early 2000s. The only thing that had been replaced in all that time was the blower.

Routine checkups may also be a factor - for example in a HVAC, do you have the property manager do things like replace the furnace filter every month or three if you can use those 90 day filters? Little things like that can extend the life of components that get a lot of use.

Something to also think about. If the system fails and needs to be replaced are you able to wait 3-4 weeks for the replacement? We had both our HVAC systems die in the middle of January one year in North Carolina. This was even before the pandemic. Took 4 weeks to fabricate the mounting needed to install the new units. For 4 weeks we had to run space heaters to keep the water pipes from freezing. I realize you are in Arizona, but depending on what the building is used for, can you go 3-4 weeks due to pandemic supply chain and labor issues waiting?

Our HOA will make reasonable repairs on all amenities irrespective of the capital replacement plan we have in place.

In your example, we would maintain our annual maintenance plan on the "old" HVAC (which ours is 15 years old) until failure is imminent, requiring replacement. Then, we'd move quickly on said replacement. You'll be replacing that HVAC soon enough but, with maintenance, your reserves can simply be preserved a bit.

Np,

With HVAC, you *might* have the luxury of time if the system crashes and burns, but at a certain point, with certain components like, say, a critical trash compactor, the situation stinks when you end up spending nearly as much on repairs as a new replacement system (that has a 3 month lead time) would have cost...

Regards,
Steve