Advice Needed: Dividing utilities between top floor and basement suite

[Christopher Brown]

I've just placed an offer on a home with a 3 bedroom top floor and a two bedroom basement suite. In my area, usually basement suites are rented with utilities included. But if I rent the top floor to one family and the basement to another, what is the best way of splitting utilities. I can't expect the top floor to pay the bottom's utilities, and asking the basement renters to pay utilities will make it less attractive compared to the competition. I've considered the following options:

- renting the entire house to one family, and allowing them to sub-lease the basement suite, effectively passing this problem onto whoever rents the entire house.

- renting out both units as "utilities included" and charging a premium in the rent for this, but then I take the risk myself if they over consume the utilities.

- charging the basement ? of the total utilities, payable to upstairs. But then they fight about who uses the most energy, and why does one need to pay for the other's over use.

- installing separate meters, but at the risk of the basement suite being less marketable.

Do you guys have any other ideas? Has anyone else run into this problem, and how did you solve it?

Thanks in advance!

[Bill S.]

Separate meters is the way to go if you can. Often this is expensive, as the wiring goes between the units in numerous locations. Also what about hot water? Is gas shared as well for hot water and heat or is it all electric.

For my property, I pay the bill and back charge the tenants based on a % of the occupied areas. It's not perfect but it works. Keeps them from abusing the utilities but is painful for me to bill them each month. Not too bad for one property but once you get a couple it's a royal pain.