All inclusive Rent?

Question

Hello,

I just bought a house and was thinking of renting two of the other rooms. I was thinking of making rent all inclusive with rent, utilities, cable, internet, cleaning services and household common area shopping( toilet paper, soap etc). Is  this a good idea? Or am I going to be broke with this option?

Thank you

Colleen F. · Answer

Do not include use based utilities like electric or place a cap on them.   Basically weigh your administration cost versus whether it is a fixed expense.  For a $20.00 a month water bill I just use an excess use clause.   For fixed expenses they can easily be rolled into the rent.   Heavy use based expenses are harder and there should be a disincentive to a lot of use. Also is your tenant pool  a student for  a couple of semesters or a full time roommate.  For  a multi we have included heat and hot water but  I would not include electric ,  the ACs would go like crazy.

Kelly N. · Answer

Hi Sarah,

I have a triplex where I pay the basic utilities- gas, electricity, and water- so far it isn't to bad.  I KNOW the expenses are higher than if they were paying them themselves so splitting them is in plans, but for now it is working.  I know what the bills will typically be and the rents cover that.  I have toyed with offering internet but don't want to deal with the calls when it is not working.

My friend rents out rooms and includes the basic utilities plus cable and internet and this is working well for her too.  The cable and internet are a fixed expense and she would be paying them even without allowing the tenants to use them, so it makes sense to include these in the rent.  I am not sure what she does as far as tp and soap, each tenant has their own bathroom so I think she probably doesn't cover those, but with shared bathrooms you almost have to.  I think capping the utility expenses is a good idea- helps protect you against a wasteful tenant.

Kelly

Meng W. · Answer

bad idea in my opinion. I included utlities in the rent and my bill sky rocketed. So i had to change the lease with the tenant. Tenants will know that they will have access to unlimited use of whatever your offering and will take advantage of it. Have you thought about just giving them internet for free ( that is a fixed price it won"t change that much)

If you are planning to include everything, i think it is best if you set a limit for them. For instance, electricity exceed over $150 per month will be at X% of the tenants responsibility. That way you are safe if anything beyond your price level you want to pay for them.

All inclusive Rent?

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