How to address water usage/bill on duplex

15 Replies

I'm writing in hopes of getting some advice about how to tackle a situation that I'm dealing with regarding the water bill.  Here's the background:

-I recently purchased a duplex and am occupying one unit and renting the other

-Currently, the owner (me) is footing the water bill for the building

-My unit has in-unit laundry, the other does not

-The water bill averages $200/month

I'm considering the following options and would really appreciate any advice on how you would handle the situation:

1) Once I move out, continue to pay the water bill (expensive over the long run)

2) Work in a flat fee to the rent and pay the difference myself each month (tough sell to tenants)

3) Install a secondary meter and charge tenants back at the end of each month for their usage (requires more work on the part of the property manager, hassle to charge precise bill to tenants each month)

4) Run a second water line, completely separate bills and make the tenants completely responsible for their own water bill (most expensive, initially)

What are your thoughts, and can you think of any better options to deal with the issue?  Any and all input is greatly appreciated.  Thanks!

If the city allows separate street side metering for multi-family, in the long run this is always going to be your best bet. I have been involved in utilities for many years and I will tell you that water consumption drops dramatically when it is individually metered. In my area, separate utilities are a selling point for multi-family. 

A lot of cities will not allow street side individual meters for multi-family. In that case, the best option is to sub-meter and assign responsibility to each unit. If you don't want the hassle of billing the exact amount, you can get a year's worth of data and then just build it into the rent (with the recognition that the tenants will waste more water if you don't charge the exact amount of the meter). 

We are submetering our duplexes. Because they are built on a slab, we were told it would be cost prohibitive to do the work to install a second city provided meter. In our city the property owner is ultimately responsible forany unpaid tenant water bills anyway, so we added a submeter at the main water shutoff and a remote reader outside for each of the units. We will bill water in addition to rent.

I wholeheartedly agree with JD Martin.  From a property manager standpoint, it is not harder but actually easier that way. Any good PM would prefer that you either have each unit metered individually or as JD said, sub-metered. Records/invoices/reconciliations are all more clean that way. 

Hi Scott,

The submeter / remote reader was installed by superior drain, it was called a Carlon SSMR

We had it professionally installed because we wanted to make sure that the water was actually split up between the units and no tenant would be charged for another tenant's water use.

We paid $750 for the parts and installation. I think the parts would be a couple hundred dollars.

I vote for #2 since it's what I have with all my properties. It's part of the rent, no one in apartments around here has separate water meters. Just like whether you do or don't include heat, this a part of the lease. Like I say with included heat, your cost is not the bill, it's the difference between what you build into the rent and what you actually pay. So what is your cost recovery time on the splitting work if you think of that way?

What are your real estate goals? Do you want to be a utility provider too? Sub metering may be easy now but it will eventually become a pain to read the meter, calculate and bill the tenant each month. Just build it into the rent and don't worry about it then go look for more deals.

@Jordan Harrison We ended up installing a submeter.  My property manager does a reading each month and charges the tenants accordingly.  It's not a perfect solution, but more fair to all involved than either a) paying the water bill out of pocket or b) charging a flat monthly rate for water.

I believe it is possible to add a second meter, but I remember when we looked into it that it wasnt going to be cost effective. We used A.H Jones Plumbing to install the sub meter, and the bill came out to $450. Hope that helps!