Investor · Fargo, ND · Member since 2016 · 23 posts · 8 votes
Hey Everyone -
I have a triplex under contract and am curious on how to approach this situation. The electric is metered by unit but the water is not. Ideally I wouldn't like the tenants to know I'm even paying for the water so they aren't careless. Is there a formula anyone has used to pro rate this cost based off of square footage per unit? Curious on techniques where people have mitigated this issue of being stuck with a large water bill.
I usually analyze the water bill for the last 12 months (6 minimum) and come up with the average monthly cost. Then I charge a flat fee per person living in each unit to cover the water cost. In my experience, water usage is related more to the number of people living in each unit rather than to the size of the unit.
My only exception is when some units are significantly different from others (i.e.: if a unit has a washer and others don’t, this unit will pay some extra for water usage).
But don’t over complicate this. Come up with a fair and easy way (and be consistent!) to bill the tenants for the water bill and then let them know how much they will be paying each month.
I usually analyze the water bill for the last 12 months (6 minimum) and come up with the average monthly cost. Then I charge a flat fee per person living in each unit to cover the water cost. In my experience, water usage is related more to the number of people living in each unit rather than to the size of the unit.
My only exception is when some units are significantly different from others (i.e.: if a unit has a washer and others don’t, this unit will pay some extra for water usage).
But don’t over complicate this. Come up with a fair and easy way (and be consistent!) to bill the tenants for the water bill and then let them know how much they will be paying each month.
Specialist · Salt Lake City, UT · Member since 2017 · 32 posts · 6 votes
8y
I know i'm late to reply to this post, but there are several was you can go about this. You can use a straight RUBS method or a 50/50 RUBS method that is a lot easier then you think.
Here are a few options for Straight Occupancy:
Occupant: $100 water bill / 6 occupants total = $16.67 per tenant
Square Footage: $ 100 water bill/ 2400 total square feet= .042 cents x the square footage of the unit
Bedroom: $100 water bill/ 5 bedrooms (assuming your triplex is (2) 2 bedrooms and (1) 1 bedroom = $20/ bedroom
Example of 50/50 (occupant & sq footage):
$100 water bill / 2 ($50/ occupants & $50/ square footage)
Specialist · Salt Lake City, UT · Member since 2017 · 32 posts · 6 votes
8y
I know i'm late to reply to this post, but there are several was you can go about this. You can use a straight RUBS method or a 50/50 RUBS method that is a lot easier then you think.
Here are a few options for Straight Occupancy:
Occupant: $100 water bill / 6 occupants total = $16.67 per tenant
Square Footage: $ 100 water bill/ 2400 total square feet= .042 cents x the square footage of the unit
Bedroom: $100 water bill/ 5 bedrooms (assuming your triplex is (2) 2 bedrooms and (1) 1 bedroom = $20/ bedroom
Example of 50/50 (occupant & sq footage):
$100 water bill / 2 ($50/ occupants & $50/ square footage)