When you’re managing an apartment complex, one of the things you’ll have to decide is which utilities you want to include. Utilities for an apartment can cover everything from water, sewer systems, and electricity to security systems and landline phones. Which of these you cover and how well they work can have a big impact on both your renters and your bottom line.
Deciding which utilities to cover is a matter of knowing who your target renters are. That’s why we’re here at Converged Services to make the process easier with expert consulting. Read on to learn more about each utility and whether or not you should cover it for your renters.
Related: ARE YOU SURE YOU'RE NOT OVERPAYING?
WATER AND SEWER
In general, if you’re planning on managing a utilities-included apartment, that will mean including water and sewer, too. These bills are usually relatively small and steady for each apartment, so folding them into rent shouldn’t be too difficult. And it may help you avoid the difficulties of residents coming to you with water issues that you can’t do anything about.
If you are charging for water or sewer, the easiest option is to divvy things up evenly. You’ll get one bill for the whole complex, and you can divide that by the number of residents you have. Then you collect the bill from each resident, which we’ll discuss more in-depth later.
If you are running a utilities-included apartment, electricity is a major bill that can vary wildly depending on the season and the residents’ usage. If one resident likes to keep their AC on 62 degrees in the middle of July, that’s going to have a huge impact on their electric bill - and yours too, if you choose to include it in the rent price.
Most of the time, apartment managers send their residents to set up individual accounts with the local electric service. There will need to be one account per apartment, so how electric bills get divided up among roommates is up to the residents. You don’t have to worry about higher bills than you expected or residents complaining because, unlike their neighbor, they’ve kept their apartment on 78 degrees all summer long.
Natural gas is another one of those bills that you may want to put back on residents, and for many of the same reasons as the electric bill. But this will depend largely on what sort of heating systems you have in place in your apartment. If you have gas-powered furnaces, the residents should absolutely be paying for their own natural gas.
In a situation where the residents pay the gas bill, set-up will work much as it does with the electric bill. However, if you don’t have gas furnaces but something else like gas-powered fireplaces, you may want to consider folding these bills into rent. In general, they will be fairly small and relatively consistent.
Related: HOW TO AUDIT A UTILITY BILL.
Depending on your area, your trash bill may come standard as part of your water and sewer bill. These are all city utilities in most places and are billed the same way. But in general, it’s a good idea to cover trash charges as part of rent even if you aren’t covering water and sewer.
Trash bills will be relatively small and consistent every month. And because most complexes have one large trash pickup, handling individual charges will be more hassle than it’s worth. However, if you’re offering something like a special recycling program, you wouldn’t be out of line to charge a little extra for that amenity.
Since residents place a high value on connectivity, it’s generally a good idea to include high-speed Internet services. You may be able to get discounts for being an apartment complex. You can also charge a little extra on rent because WiFi is included, and with a managed WiFi system, you have the ability of resetting passwords and networks upon resident move-in and move-out.
Residential communities without provided Internet can result in slower Internet for everyone. If everyone is using a different provider, there may be mixed signals and poor interception. Taking the time to choose the best one yourself will minimize hassle for residents, and remind them that they’re living in a modern, up-to-date apartment.
Find the best Internet providers for your apartment with Converged Services.
The question of whether or not you cover cable TV is tied to what you decide to do with the Internet. In general, the same questions of who owns the lines will apply to TV as to WiFi, and the two may in fact run on the same physical cable. You may have the same company providing Internet and cable to your complex.
If you decide to cover WiFi in rent, it only makes sense to cover TV as well. Residents may have to rent a cable box from the company for a nominal fee each month, but the service is there. However, if you aren’t covering the Internet, talk to your cable TV company about special bundles residents could receive if they get both Internet and TV from that company.
Find the best cable TV providers for your apartment with Converged Services.
These days, almost no one has a landline phone. But depending on your target demographic, you may want to offer the option. Some older residents still like to have a landline phone, and it can be an important safety feature in some cases.
If you plan on offering landline phone jacks, look into setting that up with the same company you have Internet and TV through. They’ll likely give you a discount on the bundle. If you aren’t covering those utilities, direct your residents to the same company that owns all the lines.
Many apartment complexes have started adding security systems as part of the amenities in their apartments. This is a win-win situation for you, the owner, and for your residents. On one hand, your property is better protected, and on the other hand, your residents feel more secure in their homes.
If you’re installing and maintaining security systems in the apartments, it makes sense to roll that fee into rent. You may include a breakdown that shows residents the additional cost of the security system. But since the security systems will be a fixture in the apartments, it doesn’t make sense for residents to be responsible for setting up separate accounts with the company.
Find the best security systems for your apartment with Converged Services.
When you’re calculating which utilities to cover or not, you will need to take into account some seasonal considerations. The biggest of these, of course, is the electricity and natural gas bills. These will change the most with the weather and may impact your decision of whether or not to cover those services.
But also think about the unique seasonal events in your area. If, for instance, you live in a college town, you may see a marked drop in water usage, Internet usage, and trash during summer and winter breaks. Plan for these changes and factor them into your overall yearly cost for the utilities.
How to Collect Bills
The question of how to collect money for rent and any attached bills is a tricky one. Online payment systems can be unreliable, confusing, or expensive, but personal checks can bounce. Which option you choose depends a lot on your rental situation.
If you know your tenants well and you have just a few of them, accepting checks or payments through PayPal or Venmo may work well for you. If you have more tenants, you may be able to require that tenants below a certain income threshold have a guarantor who ensures that if their check bounces, you’ll still get paid. Or you can use an online payment tool designed specifically for owners.
How to Maximize Apartment Security
An important part of being a property owner is assuring your residents’ safety. You can have all the amenities in the world, but if your residents are afraid someone’s going to break in every other week, you won’t get any tenants. There are a few steps you can take to maximize your apartment security.
For one thing, including security systems is a great first step to ensuring that each individual apartment is safe. If you’re managing a larger complex, you may want to put a pass code-controlled gate at all entrances. And putting some security cameras around the property can both help you discourage potential burglars, but also catch them if they do break into one of your apartments.
Pick the Right Utilities for an Apartment
Choosing which utilities you cover in an apartment is a matter of knowing your area and the kind of apartment you want to be. If you’re aiming for people with more financial resources and trying to position yourself as an all-inclusive luxury experience, cover everything but electricity and maybe natural gas. If you’re trying to go for the blue-collar workers with no-nonsense and no-frills, stick to your baseline rent and maybe city utilities and let your renters choose the rest of their utility options for themselves.
If you’d like to learn more about picking the right utilities for an apartment, check out the rest of our site at Converged Services. We can provide you with sustainable technology, proven solutions, and a team who cares. Contact us today and learn how we can help you get ahead of the competition.
Related: ATTRACT GENERATIONAL RENTERS TODAY.