Learn More About Multifamily Submetering
Multifamily submetering is a practice increasingly embraced in the real estate sector, particularly in apartment complexes and condominiums. At its core, submetering involves installing individual meters for utilities like water, electricity, and gas in each unit of a multifamily property. This enables accurate measurement and billing of usage for each resident, fostering a sense of accountability and fair distribution of costs. By implementing submetering systems, property managers can encourage conservation efforts among tenants, as they become more aware of their individual consumption patterns.
One of the primary benefits of multifamily submetering is its ability to promote energy and resource conservation. When tenants are billed based on their actual usage, rather than a flat fee, they are incentivized to adopt more sustainable practices. This can lead to a reduction in overall utility consumption within the property, resulting in cost savings for both residents and property owners alike. Additionally, submetering allows for better detection of leaks or inefficiencies, enabling prompt repairs and further minimizing waste.
Furthermore, multifamily submetering can enhance transparency and equity within a residential community. With accurate measurements of individual usage, residents can have confidence that they are only paying for the resources they consume. This helps to alleviate disputes over shared utility costs and fosters a sense of fairness among neighbors. Moreover, submetering systems often provide residents with access to real-time usage data, empowering them to make informed decisions about their consumption habits and ultimately leading to more efficient use of resources.
Rent cannot always be increased. - Each market only has so much room for rental increases before they become uncompetitive. If they exceed the market threshold, they will be unable to rent in a particular market. In other words, renters will go to other communities where it is cheaper. If their utility costs exceed the threshold of what they can reasonably charge, they are forced to absorb the difference, and their bottom line is impacted. Instituting RUBs or submeters, allows them to remove that volatile item from the equation. They are, therefore, able to remain competitive in a given market by offering affordable rent. The RUBS program will create a mechanism for recapturing utility costs without affecting advertised rent.
Consumption and Cost Can Change – in a given year the consumption on the property can change drastically. Here is an example. What if 50% of the renters are two occupant families, 25% are 1 occupant, and the remainder 3 occupant families. In our test, each occupant uses 1,500 gallons per month. Here is the math.
Now change the occupancy picture, and suddenly there is a ten percent increase in consumption.
Add to that, the residents may simply begin consuming more. Finally, what if the utility raises the rate? The property does not have the ability to change rent because there are leases in place. They must wait until each lease renews before they can increase rent. That will transpire over the course of a year. While that is occurring, they are losing profit. Factoring utility costs into rent is a very risky proposition in a world where the utility picture can change rapidly and drastically.
A RUBS program allows property owners and managers to recoup utility expenditures without raising rent when meters cannot be installed. It may be impossible to install meters, or the community may not have the financial resources to do so. They can, however, remain competitive in the market and with certainty recoup utility costs by instituting a RUBS program.Providing Submetering Services through
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