New fourplex owner questions (utilities, rent, etc...)

[Brian Orr]

Hey BP family,

So I finally did it and made the jump into multi-family with my first 4plex closed today. I wanted to run the summary information here and get what feedback I could from all your experience. I've only purchased vacant SFHs before this. Any information and your time is greatly appreciated:

The rents are low, currently $420 (rural North Carolina) and market is near $500... All tenants on MTM lease

I will not raise the rent itself until April, giving them plenty of notice. I do not want to scare them away, nor force them away before winter. I do plan on raising it to $450 annual lease in April and to $500 by the next lease or with new tenants. But I do need to cut expenses drastically!

Water/sewer bill avg: $130/mth

Santitation: $95/mth

I was wondering if i should I individually meter? Cost is about $4000. Or maybe line item a water payment 1/4 of total on the lease above the rent? In the tenants head I'm thinking "they take baths, I don't" or "He has a baby pool in the yard, I'm not paying for that" 

Essentially I have the same question for sanitation. Currently 1 dumpster, but the company will provide 4 separate trash cans and setup the tenants on individual accounts. Or can I line item that too? My biggest fear with seperating utilities in both cases is if they don't pay, I get stuck with a monster water bill or with trash everywhere. But if I line item them, i'm essentially raising their cost of living by $40 and $25 for water and trash...

I'm also trying to figure out the best management solution. It's about 1.5 hours from me, and I plan to manage it myself (at least until I can get the rents up). But all of this management software is super expensive. I guess quickbooks and excel will have to do. But some tenants pay cash and I need to get that done with immediately.

Should I manage under a DBA or does that even matter? (It's owned in my LLC)

I wanted to ask about punch list items, should I open that door to them or am I asking for trouble? Maybe ask for 1 wish list repair or something and anything they've requested that hasn't been done yet

I'm setting up a welcome packet to have them all sign new applications, lease agreements, pet policies, lead paint, etc... And I'd like to have this all settled by mid-month to have them prepared for December or January utility changes.

As always, thanks BP!