Salt Lake multifamily: Submeter or RUBS?

Question

Hey BP!

After listening to RE podcast episode 425 about “Who not how” and reading the book, I’m inspired and now looking for some help. I currently own a triplex and am under contract on a 4-plex in Salt Lake City. I currently pay the water bill each month and would like to start either submetering or a RUBS.

Any local SLC investors/property managers care to share some advice on this topic? In particular: which method makes more sense? Any contractors/companies you recommend?

I’ve done some light research on it, but most of the info is focused on larger multi family properties.

Thanks for the help!

Robert

Amy Kendall · Answer

@Robert Belz I have done this a few ways without having to go through the process of submetering:  First, you could talk  with the city and if you have been paying the bill long enough, some cities will put you on equal pay each month.  Then, you could simply divide the bill between all tenants each month and it would always be the same amount.  You could also do this yourself and just take the average over the last year and divide that up between the tenants.  I would avoid taking the monthly bill and dividing it evenly between the tenants each month, because they very quickly begin to harbor negative feelings towards their neighbors if the bill were to increase by say $10 in a given month.  But, in my experience if you take the average over the last year and divide that evenly so they know exactly what it will be each month, then you can avoid that negativity.

Robert Belz · Answer

@Amy Kendall Thank you for the advice. Apologies, I realized I never responded to your message!

We closed on that 4plex and followed through with your last recommendation: taking the average over the last year and dividing it evenly, so thanks again.

The hard part now is attempting to continue growing our portfolio. It almost feels like using the MLS in Salt Lake is an obsolete tool in this current market, and it feels like I've called every 4-20 door apartment complex in SLC limits with no luck.