How to charge for water on multiplex

4 Replies

I am looking into mutliplexs. If I make the tenants pay for water and garbage my numbers work on many. Electric meters are usually separate on most but how do you split water bills or get meters for the water usage? If I pay for water it is hard to make my numbers work.

Some cities allow you to split the water and add water meters to each unit. If not, look at a system called RUBS. It's a sub-metering platform that others have used and like. (I've never used it myself)

If your numbers are so close that the water bill puts you under water (see what I did there?) then it sounds like the deal is too risky to start with.

As far as how to have the tenants pay for water.......there are many opinions and I am sure you will get several here.

I am of the mindset that it is not worth trying to manager the water bill by passing it along to the tenants in a multifamily property. I just figure out what the average water bill is per month per unit and simply raise the rent to off set the water bill. This eliminates me having to collect the rent and also collect the water bill divided by four from each tenant in a four unit building.

If you have dug a fox hole on the "tenant is gonna pay for their own water" then your best option would be to put water meters on the inlet water valve on each unit. Then you will have to visit each unit and calculate their portion of the water use and divide this into the total bill. Next you will have to send this bill out to each tenant and lets hope they comprehend and trust your math. I am getting tired already just explaining it. Just raise the rent :)

Having the local water company come out and dig new crocks and put water meters in for each individual unit will never ROI for you. It cost thousands to have this done on a four unit building.

Now, for someone in buildings such as a mobile home community where the after market meters can be put on and read from the exterior of each mobile home and there are enough units to make it worth the time this can be a good option.

But in a four unit or smaller multifamily apartment......did i mention just raising the rent?

I work for a property management company and what we do is pay the water bill and bill back the tenants evenly with a copy of the original bill so they see usage etc. Put it in the lease so they understand as well.

Thanks for your input. Raising rents seems easier. I will also ask my property management to see how they deal with water payments. I just want to see when running my numbers what makes sense because $100 per unit does add up. Thanks 

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