5 unit property with utilities included

[Amanda Ross]

We are looking at a property that was once a single family home that now has been broken up into five units. All units are currently occupied and all leases renewed at $700/unit.  The landlord is responsible for all utilities (water, power, gas).  Without dividing out the meter, what's the best way to recoup some of these expenses?  The listing agent said something about a shared washer and dryer that the current owner is missing out on as added cash flow, but I'm not sure that would cover all utilities for all five units and may be difficult to monitor.  With all the leases being newly renewed are we even able to add anything about a change in how utilities are being paid/split/etc?

[Dennis Cosgrave]

Buying a property that has been divided up into 5 units with only one meter waves a red flag for me. If the house was legally divided and permitted, building code in many jurisdictions require separate meters. Before you proceed with the purchase, check with the municipality to confirm that it is a legal 5 unit dwelling.