Lesson learned - food for thought . .

[Kelly G.]

I just thought I would relay my costly lesson in 'fairness'. I have a SFR in Milwaukee. This is the first year I am managing it myself having burned through 3 property managers in about as many years - costing me more $$ than it was worth. I don't live in Milw or WI so a PM seemed to make sense.

So I got the package of rental forms from WI Legal something or other, and on the initial agreement (M-M) I only required tenants to pay for "water"; not fully realizing that the Milwaukee water bill also has "sewer" and "muni" charges - which are far more than "water".  I was trying to be "fair" -

Well - I changed that agreement in November, requiring the tenants to pay "water", "sewer" and 1/2 of Muni - that seemed fair too.  

Unfortunately I did not word my rental agreement modification carefully enough. I got a notice from Milwaukee Water telling me that the water use for this quarter was 4 times higher than 'normal'.  I sent an email to the tenants inquiring about a possible leak, which is when they said the toilet was 'making noise'.  

So this quarter's water bill was $663 instead of the 'average' $250.  Since my rental modification did not specify that I would pay 1/2 of the "normal" "Muni" charges (which includes some sewer, so it's also based on 'water use) - I am ending up paying $175 this quarter instead of $50!  Ouch!  This in addition to having to fix the toilet (I need a cheaper handyman too!)  

I would love to only pay for "normal" use, but that's not what my rental modification says.

Longer story than I anticipated, but . . .  when writing/modifying rental agreements - the devil IS in the details.   I'll be preparing a modification to my modification!

[John Underwood]

Originally posted by @Kelly G.:

I just thought I would relay my costly lesson in 'fairness'. I have a SFR in Milwaukee. This is the first year I am managing it myself having burned through 3 property managers in about as many years - costing me more $$ than it was worth. I don't live in Milw or WI so a PM seemed to make sense.

So I got the package of rental forms from WI Legal something or other, and on the initial agreement (M-M) I only required tenants to pay for "water"; not fully realizing that the Milwaukee water bill also has "sewer" and "muni" charges - which are far more than "water".  I was trying to be "fair" -

Well - I changed that agreement in November, requiring the tenants to pay "water", "sewer" and 1/2 of Muni - that seemed fair too.  

Unfortunately I did not word my rental agreement modification carefully enough. I got a notice from Milwaukee Water telling me that the water use for this quarter was 4 times higher than 'normal'.  I sent an email to the tenants inquiring about a possible leak, which is when they said the toilet was 'making noise'.  

So this quarter's water bill was $663 instead of the 'average' $250.  Since my rental modification did not specify that I would pay 1/2 of the "normal" "Muni" charges (which includes some sewer, so it's also based on 'water use) - I am ending up paying $175 this quarter instead of $50!  Ouch!  This in addition to having to fix the toilet (I need a cheaper handyman too!)  

I would love to only pay for "normal" use, but that's not what my rental modification says.

Longer story than I anticipated, but . . .  when writing/modifying rental agreements - the devil IS in the details.   I'll be preparing a modification to my modification!

 For my rentals I require the tenants to have the utilities in their name. Is there a reason why you are agreeing to pay any utilities or have these in your name?

Maybe a requirement of some sort for you?