Utility Protocols in Chicago

3 Replies

Hi everyone,

I'm a new investor and beginning the education process before deciding to buy my first multi-property in the city of Chicago and/or surrounding cities. I had a question in regards to utilities. Does anyone know what I can and cannot charge tenants (i.e. water, gas, sewer, garbage, etc..)?

I was thinking of having them pay for their own water, gas, and electricity and I take care of sewer and garbage. I rather do that to make sure it gets done and taken cared of appropriately, but I wanted to make sure if that's okay!

Thanks in advance!

@Jennifer Rodriguez - It depends on the property type and how it is metered.  There are gas meters, electric meters, and water meters (sewer and garbage are on the water bill)

SFH usually have 1 meter for each so you can bill the tenant for everything. 2+ units usually have 1 water meter so you cannot charge them individually

Originally posted by @Jennifer Rodriguez :

Hi everyone,

I'm a new investor and beginning the education process before deciding to buy my first multi-property in the city of Chicago and/or surrounding cities. I had a question in regards to utilities. Does anyone know what I can and cannot charge tenants (i.e. water, gas, sewer, garbage, etc..)?

I was thinking of having them pay for their own water, gas, and electricity and I take care of sewer and garbage. I rather do that to make sure it gets done and taken cared of appropriately, but I wanted to make sure if that's okay!

Thanks in advance!

 Hi Jennifer.  I'm an investor in the city of Chicago.  Which utilities you can have your tenants pay for largely depends on the property.  Many houses in Chicago have one boiler to heat the 2-4 units.  Sometimes one electrical account will provide electricity to multiple units.  In cases like these, you almost have to pay for the utilities yourself and market the property with them included.  You can factor that into the rent price though.  Tenants will pay a premium in rent to have utilities paid for by the landlord...particularly for heat.  I have a building where I charge $50 extra in each unit for heat included in each unit and the annual heat bill never equals the total of that.  

Water/Sewer/Garbage all come on the same bill and would be difficult to separate out. Probably for that reason water is included in rent in most 2-4 unit buildings here in Chi. 

Gas and electrical need their own meters which costs $$$ to put in, so you would have to look at it from a ROI standpoint and make the call.

What we do is take the average of the previous 12 months in gas/electric bills and assess a utility fee on top of the rent. You can get your gas/electric billed in the same way so it is an easy way to pass the cost to the tenant without the added upfront investment of sub-metering.