Due Diligence on Utilities

General Landlording & Rental Properties
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Due Diligence on Utilities

Daniel HymanBusiness Member
CPA · Milwaukee, WI · Member since 2016 · 2k+ posts · 1k+ votes

Hi All,

For our SFR in Pennsylvania, we ran the numbers according the wholesaler. It turned out that the water and sewer bill was 3 times the amount budgeted. Cash flow killer.

When going through the due diligence on a SFR, how do you verify utility expenses? 

TYIA!

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  • John Warren
    Real Estate Broker · 3412 S. Harlem Avenue Riverside, IL 60546 · Member since 2015 · 6k+ posts · 5k+ votes
    6y

    @Daniel Hyman this is where local market knowledge is so important. I invest locally primarily because I can more or less anticipate what the expenses on a property will be, and so I take a significant component of the risk out. If you are investing out of your area I would think you would want to lean heavily on a realtor, property manager or contractor to help you with these types of things. 

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  • Andrew B.
    Rockaway, NJ · Member since 2016 · 2k+ posts · 2k+ votes
    6y
    Most utility companies will tell you what the average bill was for the previous year. Call them next time to verify.
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