For many landlords and tenants, it is confusing and hard to understand who is responsible for what when it comes to air conditioning. Landlords are indeed responsible for offering a liveable place to tenants, which includes some essentials for a home to be comfortable. The same applies for commercial leases.
However, it is not always required or included in the lease agreement to install air conditioning even when it has a lot of benefits for both parties. For this reason, you need to do your research before renting any property.
In this article, we will help clear up any doubts or questions regarding responsibilities for the HVAC system in a leased property.
HVAC responsibilities
The first thing you should know is what exactly an HVAC system is, what is included, and why it is important to have in a leased property. Regardless of who is responsible for this, a basic understanding is vital. You can then move on to an agreement with the counterpart.
What is an HVAC system?
HVAC stands for heating, ventilation, and air conditioning. It refers to the technologies used to provide heating and cooling in a property. It is essential for indoor comfort and air quality.
Why is Heating important?
It is essential for tenants to feel comfortable in their rented place and this implies adequate heat supply at all times. Heat is lost through the shell of a house. The energy that a heating system requires to replace that lost depends on 4 factors:
- The location of the place
- The size of the place
- The energy-efficiency of the place
- The energy-efficiency of the system
There are some things that you can control, like the energy-efficiency of the heating system. There are also things that you cannot control, like the location or the size of the place.
In the case of rental properties, which system to buy for the property and if it will be an energy efficient HVAC system or not is an agreement that the tenant has to come to with the landlord.
Why is Ventilation important?
Ventilation is really important because if you only have heating without any type of fresh air, the health of the people living and working in the property could be at risk. This is because mould, damp, rot, and pest issues are associated with air not replaced or exchanged.
Ventilation can be mechanical (forced) and incorporated into a ducted air conditioning system to control indoor air quality. It can also be natural (passive) and occur through the flow of air through building opening, grilles, windows, and doors.
It’s important to remember that ventilation removes a combination of humidity (moisture), odours, airborne bacteria, dust, smoke, and carbon dioxide, while replenishing oxygen. It also helps makes heating and cooling more efficient.
More than the HVAC system itself, tenants play an important part in ventilation. Unless working in a commercial office with high-level ventilation and fresh air incorporated into the system, occupants should routinely open doors and windows to let some new air in.
Why is Air Conditioning important?
Air conditioning is important to ensure an acceptable environment inside, as it is directly linked to the tenant’s health. Remember that extreme hot weather in Australia is increasingly common and air conditioning can help you maintain the ideal body temperature.
Most regulations in Australia do not demand air conditioning in leased properties, which means that there is no obligation for landlords to provide an air conditioning system. However, in some parts of Australia, like Brisbane and Northern Queensland, it can be an unofficial standard to include some type of air conditioning or cooling system in a property.
HVAC stages
After understanding what HVAC it, you also have to know that system responsibilities can be divided into 4 main stages:
- Installation
- Maintenance
- Repairs
- Replacement
Furthermore, the responsibilities differs between commercial and residential properties.
Commercial Lease
For a commercial lease, the responsibility varies greatly depending on the lease agreement in place. The inclusions and exclusions can be more easily negotiated between the two parties.
Installation
HVAC installation is the first thing that should be negotiated if a property doesn’t already have air conditioning installed. This will also come with an associated negotiation about the amount of rent to be paid.
If there is air conditioner in place, then landlords have to ensure it is of a reasonable standard before tenants move in. Firstly, it should suit the area that it serves, meaning that it should be of sufficient size (kilowatt rating).
Reasonable standard also means the HVAC system should be operational, clean, and should not put occupants at risk of illness or disease as a result of sick building syndrome. Keep in mind that sick building syndrome is a condition (illness or chronic disease) suffered by building occupants linked to the building in which they live or work.
It’s worth noting that landlords are not required to add HVAC systems to suit business activities. If occupants want to add heat load or change the function of rooms or the whole building, then it’s up to them to condition the space accordingly.
Here are some examples of cases where tenants may need to add additional air conditioning:
- If renters are turning offices into server rooms, then renters are responsible for adding additional units such as wall split systems.
- If renters are turning the building into a childcare facility or school, they are the ones that should add additional ventilation as required. Keep in mind that ventilation is particularly important to support health and learning in children.
- In the case that a building uses central air conditioning, adding some degree of supplementary air conditioning is not uncommon, especially in data rooms and rooms with any additional heat load. Remember that some areas may even need a second back up AC installed when constant cooling is critical.
Maintenance
Responsibility for heating, ventilation, air conditioning, and refrigeration (HVAC&R) maintenance varies dramatically.
You need to know that the Australian HVAC&R Maintenance Guidelines and Work Place Health and Safety Regulations recommend monthly servicing of air conditioning equipment in a commercial environment to maintain acceptable indoor conditions.
However, the frequency required by the landlord depends on their own preferences to a large degree. It also depends on what has been set out in the lease agreement; monthly, quarterly, six-monthly, annually, or even not required at all.
Assuming some degree of service required, a good HVAC company can offer a competitive HVAC&R maintenance agreement to suit your needs and meet relevant standards.
Repairing
When a HVAC repairs situation arises, it can be problematic and unpleasant to work out who’s responsibility it is. So please be aware of this information before the need arises.
Some agreements will require tenants pay for all repairs, even if it is not financially viable and the system is passed its serviceable lifespan. Less-than-desirable landlords may push tenants to continue carrying out repairs, even when the system should be replaced. So, if you are a tenant, keep an eye on this requirement and the specifics outlined in the lease agreement.
In other cases, some landlords may only require tenants carry out minor repairs and/or up to a certain value. Other landlords may foot the bill for all repairs, assuming the damage wasn’t caused by the occupants. If you find a good landlord like this, it’s worth sticking with them as long as practical!
Keep in mind that any damage caused by occupants should be paid for by them. Also, any variations tenants want due to business/personal preferences, like changes to airflow, air balancing, outlet/zone configuration changing, etc., are typically the responsibility of the renter.
Replacement
For replacement, before taking any action, you need to weigh up the pros and cons of replacement vs repairing and make the right choice.
The diagnosing air conditioning technician should be able to provide a report and comment on the overall condition of the system to assist with this decision-making. A quote for both options (repair and replacement) can also be helpful.
If a replacement is imminent or the only option available, then landlords are responsible for replacing it. This is assuming the system was already in place when the tenants moved in. If the system belongs to the tenants, then obviously it’s up to them to replace it.
Domestic Lease
For a domestic lease, the responsibility also depends on the lease agreement in place. However, the conditions are not as varied due to state and territory organisations, such as the Residential Tenancies Authority in Queensland, providing guidelines on such agreements.
Installation
If a tenant wants an air conditioner installed, then he or she will have to negotiate this with the landlord. Air conditioning in a leased property is not a requirement and landlords don’t usually want to spend more money than is necessary. So, it is a possibility that the tenant may have to pay the full cost.
However, it is becoming increasingly common in warmer climates such as Brisbane for air conditioning installation to be negotiated in exchange for higher rents. For example, tenants may pay an extra $10/week to have a wall split system installed in their bedroom. As a result, the system will be “paid off” within 3-4 years.
The bonuses continue for the owner. Now there is an air conditioner installed in the property, increasing the property value, and the tenants continue to pay the higher rent!
If the tenants have to foot the whole AC install bill, then it’s also possible that they will have to remove the air conditioner when they leave and patch/paint any holes left as a result. For this reason, you as a tenant, have to think about the best air conditioning system for leased properties. You can either install a window air conditioner or buy a portable one so it will be easier for you to remove it when you move.
Maintenance
The most common situation for rentals is that the tenants are responsible for the maintenance of the HVAC unit. Tenants are typically responsible for basic care only including, depending on usage, checking the aircon unit every 1-2 months and proper filter cleaning when required.
Keep in mind that cleaning aircon filters is also really beneficial for tenants while living there. Filter cleaning helps save on energy bills, improve the AC performance, have less chance of a breakdown (which means time without AC), achieve cleaner indoor air, and reduce the risk of illness-causing mould building up within the indoor unit.
Not enough filter cleaning is a well-known mistake because this may decrease airflow into the AC unit as well as decrease efficiency. It also promotes mould growth and causes dirty air to circulate.
However, too much filter cleaning is also a mistake because every time you clean a filter it wears away a little. As a result, filters can wear out sooner than they should and fall apart at a certain point.
On the other hand, landlords are the ones responsible for major six-monthly or annual level professional AC services.
What should professional aircon service include?
- Full inspection of the air conditioning system.
- Check filters; Remove, clean and re-install where required.
- Show occupants how to carry out a filter-cleaning process where required.
- Check condensate drain.
- Check the drain tray.
- Check the safety drain.
- Flush drains where required.
- Place condensate tablet in-tray of the main drain.
- Check for signs of oil or refrigerant leaks.
- Check refrigerant charge where required.
- Check for signs of vermin.
- Check the condition of the evaporator coil.
- Check the condition of the condenser coil.
- Check belts; Tighten/realign where required.
- Check bearings.
- Check motors and mechanical components.
- Check pipework for damage to insulation.
- Check operation of reversing valve where required.
- Check electrical terminals; Tighten/adjust where required.
- Check the airflow.
- Check to supply air temperature.
- Check for fault codes.
- Check thermostat/sensors; Adjust/calibrate where required.
- Check voltage reading where required.
- Check full load amps reading where required.
- Check the general operation of the unit.
- Make minor adjustments where required.
- Assist occupants with settings/using the system where required.
- Report to the owner/property manager on any issues found.
There are many benefits in servicing the air conditioning system. Therefore, the tenant and landlord need to include this in the lease agreement.
Repairing
Landlords are responsible for standard air conditioner repairs. However, tenants are responsible for any damage they cause, like denting a unit while moving in/out, pet dog chewing insulation/cables at the outdoor unit, water damage caused by incorrect usage/cleaning, mould having to be removed due to AC neglect, etc.
Tenants need to be careful to not damage the aircon system. They obviously want to prevent the need for repairs and avoid committing any of the many common air conditioning mistakes.
Replacement
Replacement is associated with a high cost because is involves buying a brand new air conditioning system. In this instance, the landlord is responsible for aircon replacement if/when the system is beyond repairs.
This is assuming that the air conditioner was installed by the owner, and/or is included in the lease agreement. If a tenant chooses to install the air conditioning system, or damages an AC unit beyond repair, then the cost of replacement comes back to the tenant.
Lease agreement
Remember that in a lease agreement it is up to you both, the tenant and the landlord, to establish and explain the requirements in relation to HVAC installation, maintenance, repairs, and replacement. As a landlord, you can take all of the responsibility or choose to share it with the renters.
In conclusion, the landlord is responsible to provide heating and basic ventilation, but the whole air conditioning system is not an obligation. If the renter needs it then he or she can reach an agreement with the landlord to have it installed. This may be in exchange for an increase in rent, shared initial cost, or it may be at the sole expense of either party.
Remember that getting the best possible agreement is up to you. Read everything in the contract carefully (yes, even that small print). Finally, if you do not agree with something, be prepared to negotiate.
