Why do landlords pay for the tenants' water?

Question

I notice that water is paid by the landlord sometimes.  Why and how would this benefit the landlord?

Michael G. · Answer

There is a really good Thread on this:  Landlords should NEVER pay for their tenants' water (or any other service/utility that they use). Instead, they should pay the bill in full, then re-bill it to the tenants as 'Added-Rent' according to some fair apportionment (% of occupancy or square feet, for example).

This can and should be done regardless of whether or not there are separate meters for each unit or not. "RUBS billing" or Ratio Utility Billing is perfect for this (google it)

Here's the thread:  https://www.biggerpockets.com/forums/52/topics/121...

Eric Wang · Answer

Landlord pays since there is only 1 water meter to multi unit.  Benefit would be the tax write off.  Multi units in my area usually includes water and garage, so thats something I include in the rent and tenants like the fact it's included in the rent.

Anthony Stokes · Answer

The water bill will always be attached to the property. Landlords pay the water because they do not trust the tenant to be responsible enough to pay it. If a landlord allows the tenant to pay the water and they continue to ignore the bill for whatever reasons, the landlord will have to eventually come out of pocket to clear it up :pissed:. One way to avoid having a large bill if you decide to have the tenant pay water, is to make the tenant get the water bill transferred in their name like all the other utilities.

Lynn Z · Answer

My sister had a graduate student who rented a small house for a year and he had failed to pay the water bill for 8 months.   She found out because we got a contract on the house and they didn't want to cut the water on for the new owner without that bill being paid.

She and her husband when down there and I ran into a university job locator who happened to mention where in  New England he was working.  When the water department got all of the information they didn't insist that the owner pay.  The sewer for that area requires that it only be in the owner's name so that must be paid quarterly, scanned and paid by the tenant the next month.

If I went two months without paying my water bill they would cut off my water but some people get by with it.  We always spell it out in the lease which utilities they pay but sometimes they're hopeful it's you.

Christian Malesic · Answer

We bought a 2 unit with a $4k water bill!  It was attached to the property even though the seller (landlord) had a tenant pays clause in his lease.

We did not have to pay it, the seller did at the closing table; but, it is a scary thought.

In our area water bills must be in the owners name and sent to the owner address.  In one of the municipalities it is quarterly whereas the others are monthly.  Thus, to have the tenant pay it is usually done as a reimbursement as the owner needs to pay the bill within a deadline and the tenants are not that fast.

Lynn Z · Answer

Yeh, tenants love the fact that water is included in the rent so they can bring their friends laundry over and wash their cars for "free" at their apartments.  
Don't you just love em?  In our city we used the revert to landlord program.  I really didn't know it existed for awhile because they used to refuse to do it.

Water department no longer goes against the landlord for the unpaid bills.
What a relief.

Bob McIntosh · Answer

In my hometown if the tenant fails to pay for the water it is still attached to the landlord, and after enough time the city will place a lein against the property for the amount owed to the city for the water.  More often than not, if the landlord is paying for the water then the rent has been increased to cover the average cost of the water being used.  While this may not always be the case, it is what I have seen most often.

Tom C · Answer

In my area the landlord pays the water when it is multifamily and one meter or when the landlord does not have a dwelling permit and doesn't want the city to find out that they renting the place without one. In order for a tenant to get the water put in their name, they must show a lease agreement, then the water dept checks for a dwelling permit, if there isn't one, they contact the health dept and all hell breaks loose.

Jon Holdman · Answer

Some areas require the water stay in the owners name.  Others allow it to be transfered to the tenant.  IMHO, you want the tenant to pay.  Some areas allow a "landlord account" or "third party notification" that will cause it to revert to your name if the tenant doesn't pay.

Why do landlords pay for the tenants' water?

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