OfflineI went to look at a house today and it was heated by oil. The majority of other houses in this area were heated by gas. I am slightly scared away by the fact that this house is heated by oil and I know many potential buyers would be as well. What is everyone's experience with oil heated homes? Are they worth dealing with? Thoughts?
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I can tell you my experience, 1 st of all I was in the home heating oil industry for 27 years & owned an oil company for 19 years. I've been a real estate investor since 1997 & full time since 2000.
Cons - If the property has a underground storage tank it can be a problem to obtain home owners insurance due to EPA issues.
Reputation of being dirty (soot), smells (fuel oil).
Large bills due to filling a storage tank of 275, 550 or even 1000 gallon capacity price at $ 3.30 to 3.95 per gallon, where as natural gas bills monthly for the actual consumption.
More mechanical break downs since you are taking a liquid, atomizing it, then burning it ( Natural gas is in a gas state so it burns cleaner & easier.)
Pros - More personalize service, usually depending upon your area there is only one natural gas company, where as you can pick up the phone book & there could be 50 home heating oil companies ... more competition for customers, better service & price.
Oil burns hotter than gas & with newer flame retention oil burners can be 95% efficent.
Safer !!! Can not explode!
Oil companies have budget plans so they can estimate your consumption & have you pay equal monthly payments to help offset big bulk deliveries.
I would not be concerned so much with what type of fuel heats the home, my concern would be what is the age & condition of the heating system.
Remember, price is what sells the house, people can always up-grade or convert to gas if they feel like it, & if they get a good enough deal they can
change heating systems, kitchens & bathrooms.
Runs your numbers, work the deal, not the heating system. Jill & I have made over a million dollars buying, fixing, & flipping 2 bedroom homes here in Florida, now I'm sure many investors would say they stay away from 2 bed houses, at least unless it's a great deal!
I sold real estate on Cape Cod for a few years, and most homes there are heated with oil. Lots of people in New England use fuel oil for heat. Make sure the tank is sound and not leaking, and that there isn't an old tank buried somewhere on the property - the environmental impact from old buried tanks is the the biggest negative.
Good luck!
I live in NY and own a home heated by oil, and my tank is underground.
That said:
1- It does heat well, but it definitley makes a difference with the age of the heating system. We bought our house in 2006 with the original heating system from 1970. 4 years later we had to replace it, so it was 40 years old. What a difference in oil consumption and efficiency! Seriously we get almost 50% more out of our tank. (In the dead of winter we would have to fill our tank every 2 months and now every 3.)
2- Yes, purchasing oil in winter is horrible because you have to buy it so often and the companies here do not offer monthly payment plans. But once you live in the house for a year and know your usage, then you can save accordingly because you don't have to fill up all summer.
3- As for the tank in the ground... it didn't make a difference when purchasing our home owner's insurance becasue it is common in our area. So do your homework and ask the realtor what they know about the surrounding neighborhoods.
And if it is an issue, oil tank abandonment isn't complicated, but you need to find out about any county laws as far as being allowed to leave the tank in the ground or not. Some towns allow it to be emptied and just filled with sand or foam with the tank left in the ground. But some require it to be physically removed completely. If that's the case you want to make sure it is done properly by a reputable company because if there is contamination in the ground there can be some very hefty fines involved.
4- It was mentioned above that the new owners can convert to gas if they want to. Yes, but if it's a strong issue with selling, find out about the gas lines on the street. We wanted to convert our house originally, but after calling the local companies we found out that if there is no gas line already on your street YOU are responsible for paying to install the piping to your house from wherever the main line is in your town. PLUS, for us we are the 5th house up from the main line which doesn't sound bad, BUT it still would have cost us around $8000 to get a new gas line installed. So it is no easy conversion if that is what needs to be done!
That's my two cents just from my personal experiences. Hope that's helpful.
Life is full of choices, and these choices become your reality... YOU are in control of your future! YOU decide the direction your life will take. YOU have to make things happen, no one will do it for you!
When opportunity knocks, will you answer?
Great information everyone. Thank you for your time.
Nick
Speaking from experience, even if the tenants are responsible for filling the tank if they for some reason can not because lack of funds your home can be condemned. I have had it happen to me before. When you have gas heat you first get the product then you pay, with oil heat you must pay first before you get the product. I have had tenants that didn't have the $700 and change to get oil and they called the city inspector and because the tenant had no heat my home was condemn. From my point of view either convert to gas or don't even bother with it.
Thanks Joseph