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Updated over 5 years ago on . Most recent reply

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Ben Feder
  • Investor
  • Philadelphia, PA
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How do you get the utilities charged directly to the tenants?

Ben Feder
  • Investor
  • Philadelphia, PA
Posted

How do you get the utilities like electricity and gas charged directly to the tenants instead of building it into the rent? I used to live in apartments and I paid the utilities directly without having to go through the landlord. One apartment I lived at I paid the management companies. But either way, how does it work? Are there meters to determine utility usage and if so, how does that work in terms of getting the utility charges sent directly to the tenants instead of through me, or at least the exact amounts sent to management so management can charge them?

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Marc Winter
  • Real Estate Broker
  • Northeast PA
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Marc Winter
  • Real Estate Broker
  • Northeast PA
Replied

@Ben Feder, utilities have meters and accounts.  If it's a single-family unit, it's simple; one electric meter, one account--the tenants.

On multi-family buildings it can get complicated.  For example, a 6-family building needs 7 electric meters.  One for each apartment so the tenant pays their own, and a 'house' or common-area meter that is the owner's responsibility.

If there are no separate meters, it is problematic to submeter (although it sometimes can be done), or the owner must pay all.

Keep in mind, it is a major problem if an electric company finds an owner 'co-mingling' common area electric on the meter of a tenant, in other words having the tenant pay for exterior lights or common hallway lighting that should be on the landlord meter.  

That's a no-no that could cost you lots.

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