Water/sewer bill - what to do with it?

Question

Hi,

I'm just wondering what to do with water bill for rental properties. In case of duplexes or triplexes, should landlord pay the bill or should we install multiple water meters and let the tenants pay for themselves? I'm located in PA.

Thanks.

Kyle Meyers · Answer

I would try to sub-meter if possible. If the tenants pay for their usage, they are more in control of their bills. There are many sub-metering companies, contact a few to see what they can offer you. You also have to be sure the plumbing is completely separate between the units so one tenant isn't paying for another one's use.

Steve Babiak · Answer

In Philadelphia, both water and natural gas are lienable utilities - if the tenant fails to pay, the landlord can get stuck with the bill in the form of a lien.

In PA, regarding the arrangements that some mention they make with tenants to split up the bill - there are some court rulings that basically make those utility bills the landlord's responsibility anyway.  
http://dornish.net/a-change-in-the-interpretatation-of-1529-1-of-the-public-utility-code-beneficial-to-landlords

And tenants are able to find this out too; see link here:
http://www.ourturn.net/utilities.php

Be careful how you have multiple meters set up.  I was looking at buying a house once that had two water meters, but only one water line to the street - so only one shut-off valve for the water company to use in non-payment.  Guess what the rest of the story goes like.  Tenant in unit 1 pays in full and on time, but tenant in unit 2 is a deadbeat and doesn't pay; water company goes to the house and shuts off the water at the street - and now tenant in unit 1 is peeved when there is no water.  Moral of the story is if you only have one shut-off, and you do sub-meter, then the landlord better be the one paying directly to the utility, and billing tenants by the readings on the sub-meters.

Jason A. · Answer

In some areas it is possible to sub-meter. They place a meter on each unit within the main. This makes it possible for tenants to pay their own bills. Also, if you are going to be paying the water, install low-flow aerators on the sinks and low-flow shower-heads on the showers. You could also place a brick in the back of the toilet tanks if they are the old high-volume flush style. This will save about a gallon per flush. Best of luck.

Joel Owens · Answer

I would offload all expenses onto the tenant.

Water has been referred to by my investor clients as "liquid GOLD".

If the landlord pays water the tenant NEVER tells you about leaks or the toilet running constantly etc. If the tenant has to pay the money you better believe they will tell you about it.The tenant also lets their buddies come over to wash their cars,the tenants takes extra long showers,and also lets friends come over and run the washer and dryer constantly because their friends do not have a place to do clothes themselves.

I have also seen on a building before where the rent included the power bill.A tenant had the A/C on with setting at 60 and a blanket on themselves because they were cold.

So long story short you want the tenant to bare the burden of all utilities.

Trash can be included with apartments as that is simple.Utilities can eat a landlords cash flow ALIVE.

Edward Hooks · Answer

I would first ask if the UnPaid Water Bill reverts to responsibility of TITLED OWNER. In my area the Electricity and Natural Gas are responsibility of tenant, but WATER tax stays with property owner.

We set new Landlords up with Owner Revert on utilities, to avoid reconnects and we request Landlord Copies of Water Bills. If tenant is not paying we want to know before they move out with a shut-off because municipal water looks to Landlord to pay or the next Tenant can't get service.

Individual Metering if practical (affordable) would be my choice, because all guess work is gone when bills go up. Having Water included to a certain amount could help in marketing without leaving you exposed to unreasonable usage. Estimating Delta's on seasons and tenant moves will no doubt provide a use of your time, but probably not Highest & Best Use of a most valuable asset.

Either-Way, The Tenant Must Pay ;-)

Andy M. · Answer

I've done a couple things... I have some duplexes where I make both tenants contribute to the water bill, I have some where I just pay the whole thing. Depends on what you negotiate. In my are I have never heard of property owners of duplexes and triplexes sub metering water and sewer.