Waterbill Problems Need solutions

4 Replies

Hey,

I just bought my first investment property and I got this property simply to get my feet wet. I purchased this property at $7800 total and have put a few hundred into it since Dec. I know that it is about time for me to get it rented out but I just don’t have a lot of time to work on it. I have came to the decision to pay for the rest of the work so I can start to receive money on this property. This particular property has two house on the same lot. 1bd/1bth stand alone units. 

I am located in Alabama and want to know the best course of action when dealing with two tenants and 1 water line. Open to all suggestions.

Thanks

well, it had to work somehow before. it sounds like its a duplex that's side by side instead of stacked. have you had a licensed contractor, home inspector come by yet? if not you should just to be safest. you don't want to rent the place and its violating code. 

kudos,

Mary

@Vernon N Hunter , coming to us from the home of Vincent "Bo" Jackson. I did the exact same thing with my first property but sounds like you're smarter than me and going ahead and hiring subs.  Good for you! I posted about this experience recently: https://www.biggerpockets.com/blogs/8160/71180-we-...

With a master metered property, you have a few options: (1) you become responsible for the water bill and include a flat fee in the rent (2) sub-meter the property so each unit is on their own meter, making the tenant responsible (typically VERY expensive) or (3) implement Ratio Utility Billing System (RUBS), this is where you are still responsible fo the water bill but through a formula and spreadsheet bill back the tenants their fair share. This is supported by AL Statutes and should be fairly easy for you since both units are the same size. RUBS...Bo Knows!!

For clarity, I still have a box of baseball/football cards as I idealized Bo growing up. 

Based on there being two separate buildings there is likely a single meter at one unit with two separate water lines near the meter, one to each unit. It should be very simple to install two meters and have the water in the tenants name for each building. This is the simplest and easiest to file for collections in small claims court if they default. 

I would bite the bullet on this expense and have two meters for the long term.

One of my properties has this issue (duplex with one water meter) and I too considered all the options.  In the end, I decided to just take the chance and bake it into the rents.  So far, I have not had any problems with excessive water use.  I guess it only takes one bad apple to cause a problem, but I have not had an issue yet (knock on wood).

I’d leave it alone and reconsider later if it does become a problem.

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