Your preferred way to estimate utility costs

4 Replies

When considering a property for investment in a new jurisdiction, what methods are folks using to determine/estimate the costs associated with water, sewer, garbage, and other utility costs which will be covered by the landlord? 

Is this something that can be determined/estimated easily and accurately before talking to the seller?

By what unit of measure do you estimate by (per bedroom, per unit, per square foot)?

Ask your realtor what the going is for the market in terms of which items the landlord pays for and what estimates are per unit. Nationwide the standard is $.14 per square foot - that's FHA and VA's marker at least. Realistically it totally varies by market and climate in terms of the costs and what the landlord is expected to pay. If you want a simple benchmarker, I'm in CT and it's about $25+$25/person/unit for water/septic. Family of 4 is ~125/month whereas a couple uses $75/month. Landlord pays it.

You take it from where ever you can get it, Owners paying bills will paint a rosy picture without hard copies of bills. Ask tenants what their bills are. Call utility Co and ask, although they try to get out of it by claiming confidentiality, I just ell them I'm looking at the unit to rent/but and need to know "rough numbers", they will often will say what a "budget plan # is", as in a locked in monthly electric bill of $180 for a smaller all electric home I own, but not what the current occupants' exact bill is.

  I don't think you can guestimate by rooms or square footage, structure, windows / doors & INSULATION are big factors that are very different from house to house, especially with different ages. A 20-30 year old home will be pretty well insulated, a 70-100+ year old home will be like heating a birdcage for the most part.