Responsibility of specific utilities

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Responsibility of specific utilities

Charlie Bemis
Member since 2025 · 23 posts · 5 votes
  • Are tenants typically the ones to pay for all of the following: water, sewer, garbage, gas, and electric? If any of these are the landlords responsibility, do they add that to the amount of rent they charge or is it not enough of an expense for it to matter?
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  • Joseph CacciapagliaBusiness Member
    Lender · San Antonio, TX · Member since 2020 · 1k+ posts · 1k+ votes
    2mo

    If you already have a lease in place, the lease should specifically state who is responsible for each expense. If you're just asking in general, then typically those expenses can be paid by either party, but sometimes state or local laws will put some restrictions on how the tenant can be charged. In my market, San Antonio, TX, the most common setup is for the tenant to pay electric and gas, and the landlord to pay water/sewer/trash. Often the landlord is charging the tenant a flat fee each month for the utilities that the landlord is paying directly.

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  • Richard F.
    Honolulu, HI · Member since 2008 · 3k+ posts · 2k+ votes
    2mo

    You need to check local LL/Tenant laws to see what requirements they have, AND also check with each util company to see how they normally operate and what options there may be. For example, some will have a "leave on" option, where it automatically switches billing to you once tenant stops paying. That's great if they actually moved out, but if they just stop paying the util, you will likely have a hard time recouping those funds. Some locales require owners to "provide" water. Great. But you better check for leaking faucets, running toilets, hose bibs leaking or not fully turned off, and monthly checks of exterior irrigation system schedule and operating condition, 3 or 4 times per year, depending on general age and condition. And READ the util bill every month! Track the usage, keeping an eye out for spikes. The util company should be able to give you an estimated amount of usage based on size of household for comparison. 

    If allowed by LL/Tenant laws, you might be able to provide a "base" amount of water or elec to be included in the rent, with tenant reimbursing for usage above that amount. This would need to be clearly spelled out in the rental agreement, or as an addendum, prior to signing. Of course now you also need to have a process to bill them for that reimbursement. 

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  • Drew SygitBusiness Member
    Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
    2mo
    Quote from @Charlie Bemis:
    • Are tenants typically the ones to pay for all of the following: water, sewer, garbage, gas, and electric? If any of these are the landlords responsibility, do they add that to the amount of rent they charge or is it not enough of an expense for it to matter?

    You should confirm what you can legally charge per state and local ordinances.

    Then check what the competition is doing.

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  • Jim Johnson
    Real Estate Agent · Memphis · Member since 2026 · 549 posts · 318 votes
    2mo

    It really depends on the property, the local market, and how the utilities are metered. Where utilities are separately metered, it's common for residents to pay their own electric, gas, water and other usage-based services. In properties with shared meters, owners often cover certain utilities because there's no practical way to bill them separately. 

    If an owner does include utilities in the rent, I'd encourage them to price that intentionally rather than absorb the cost and hope it balances out. Whatever arrangement you choose, the lease should clearly spell out who is responsible for each utility so there aren't any surprises later. 

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  • Kyle MccawBusiness Member
    Property Manager · Keller, TX · Member since 2011 · 1k+ posts · 1k+ votes
    2mo

    @Charlie Bemis

    It varies by market, but in the Dallas-Fort Worth area it's standard for tenants to pay water, sewer, trash, gas, and electricity directly.

    The exception is sometimes with very low-end rentals, duplexes, or older properties where utilities can't be separately metered. In those cases, a landlord may include water, sewer, and trash in the rent because those costs are relatively predictable.

    I would avoid including electricity whenever possible. It creates a misalignment of incentives. If the tenant isn't paying the bill, there's little reason to conserve energy—they may leave doors open with the A/C running all day or keep the thermostat at 65°, and utility costs can become very unpredictable.

    If a landlord does include any utilities, those costs absolutely need to be factored into the rent. Otherwise, you're just reducing your cash flow every month.

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