City Utilities vs Private Well/Septic for a Rental

[Courtney Fricke]

My goal is to soon house hack a small multi-family. One of my original preferences is for there to be city utilities instead of private. After analyzing a handful of properties I am already seeing that this preference is making it hard to find a property that meets my other criteria (location, flood zone, price, etc). 

One of my main reasons for that preference is because I would prefer for the electricity to be in the tenants' names. With a sewage treatment or septic, my parish (county to non-Louisiana people) requires a permit to turn the power on once it has been turned off or even transferred. I don't want to involve the parish continually as they tend to cause additional headaches. Even with flips they have failed the septic for non-issues which were eventually corrected on their end but caused further delays.

A solution to that could be keeping the power in my LLCs name but enforcing through the lease that failure to pay for electricity will result in a 5-day notice and therefore being ground rules for an eviction. I don't prefer this but it's a possibility that I could explore with an attorney.

What has your experience been with keeping electricity in your name?
Any tips or tricks?

What about private utilities? Any thoughts on those? 

Appreciate any input. Thanks!

[Rich Senyszyn]

We currently house hack on 5 acres outside the city in Texas.  We have septic and a well. City electric.  We were mostly able to separate the electricity for the three other units, but not completely.  One unit, we cover all utilities b/c of this issue and it is 700sf.  We added a couch, tv, refrigerator, W&D, and some other things and it rents for 1k/month as furnished. The other two rentals are unfurnished.  The others pay for their utilities as we had an electrician separate the power. 

The main thing is we absolutely do not miss the quarterly septic inspections and we have a guy for the well that can be here quickly if the pump stops for the well. The reduction in the property taxes for not using these city utilities more than covers these costs. I don't think we will ever move as we are building a 5 plex on the property, but if we did, I'd put the electricity for the well/septic in the LLC and to make sure there is no interruption.