Rental Home Utility Charges vs. Management Style - Posted by DougO(NM)

Posted by Rob FL on October 18, 1998 at 09:59:36:

I have 2 doctor’s offices that I manage. They are in one building with one meter for the electric. One office is 1st floor one is in 2nd floor. The bill comes to our office and they must reimburse us their agreed % of the bill within 7 days of receiving the bill from our office. I haven’t had a problem yet and have been managing this office for about a year.

Rental Home Utility Charges vs. Management Style - Posted by DougO(NM)

Posted by DougO(NM) on October 17, 1998 at 11:17:56:

OK, so this is a basic question, however I’d appreciate input from those that that are in the rental home business. I have recently put together my first rental deal outside of a MH Community that we own or control. In our community, we pay for water/sewer/trash, as it’s easier to control, and the resident takes care of the electric & gas. For the new deal, I’d prefer to only collect the rent and have the resident pay ALL utilities and services, however I am worried for some reason they’ll blow off the water and sewer which could result in a lien on the property. What’s best ? Should I pay the bills and collect from the resident or put the burden on them to get it done ? Appreciate any and all input. For those that are interested in such things, the details: A land trust now owns a 3 bd 2 ba, 14 x 80 MH on a 45 x 93 lot in a MH subdivision that the Trust got 100% financed through a private investor! (It pays to have a good track record paying investors ) The mo. pmt is about $560, the rent is $675, we took a deposit today and the place will be ready to in a week or so. Here’s a kicker: Did you know that a self directed IRA can purchase Beneficial Interests in Land Trusts ? Ponder THOSE possibilities !


Re: Rental Home Utility Charges vs. - Posted by Carol

Posted by Carol on October 17, 1998 at 18:12:23:

Like Bud, in our area, whoever has the water turned on is responsible for the payment … so where we have SFR or individual meters which are turned on in the tenant’s name, it’s their problem, not ours, and if not paid the water will simply be turned off.

Good luck.


Re: Rental Home Utility Charges vs. - Posted by Rob FL

Posted by Rob FL on October 17, 1998 at 13:37:59:

Maybe I am a little confused by your letter. Is the utility question for a MH or not? It sounds like its not, “first rental deal outside MH community” but then you start talking about all the numbers for a MH.

I will assume that the utility question is not for a MH.

I have a duplex that I rent out. There is only one water meter for both units, the bill is the total used for both units. There are separate electric meters for each unit. The sewer is a flat usage per unit. Here is how I handle it. I have the tenants pay their own electric and sewer since the city allows that. They don’t pay, they get stuck with the bill not me. I have a clause in my leases that says if the city puts a lien on the property or that I get stuck with a utility bill that tenants will pay me ASAP or I will take it from their deposit. As for the water bill, since there is only one meter, I pay the bill and just adjust the rent higher based on the expected monthly bill. The avereage water bill for both units is $15-20. I put a cap on it in the lease. If the bill exceeds $25 than each tenant splits the difference over $25. I don’t want one tenant to pay the bill for all, because if they don’t pay then the whole building gets the water shut off.

Rental Home Utility Charges &Management Style - Posted by Bud Branstetter

Posted by Bud Branstetter on October 17, 1998 at 12:32:59:

The self directed IRA(including Roth) can do lease options too.

I question the use of a land trust to do personal property like MH’s. A note trust that has the languge for personal property like a note should be more appropriate.

On your question of utilities. In Texas they can not put a lien on the property so the tenant is responsible. I would offer this suggestion. Have the tenant pay you an average bill amount upfront in addition to any deposits. Then send him notice of the difference so that he pays that amount with the next rent payment. You could check with the utility company if they will divulge with tenants permission if a bill has not been paid. Either way it will require attention each and every month. One of the privileges of being a landlord.

Re: Rental Utility Charges for Condos… - Posted by Mr Donald (NORVA)

Posted by Mr Donald (NORVA) on October 17, 1998 at 20:46:16:


For one of my rental properties, a condo, the association bills the owners for electric and gas usage - instead of the utilities themselves.

I make my tenant pay ALL utility charges, including any that are assessed by the condo association, plus any late fees that may occur.

I fax or mail him a copy of the bill, and have him cut them a check for the amount of the utilities directly.

Keeps me out of the loop - except that I get the condo bill each month, and I’ll know whether he pays it or not. If he is late, I’ll send a Notice to him that he is in violation of the lease, and that he’ll have 5 days to pay or quit.

Sounds harsh - but it works (usually I call him first before the notice, and let him know that it’s merely a formality).

Wondering if anyone else has a similar situation?

Mr Donald