Which Utilities do Landlords and Tenants Pay?
Moving to a new place requires budgeting for different expenses. When thinking about where your money will be going every month, rent comes to mind first. However, don’t forget about the utility bills that pop up every month. Depending on your appliances and usage, utility bills can add up quick. Before you sign a lease, be sure you know what you’re paying for. Below outlines who is responsible for paying what utilities in an apartment rental.
What Utilities Are Included?
Depending on the apartment complex you live in, there will be some utilities that you personally aren’t responsible for paying. It’s best to ask these questions when touring an apartment. This information will be outlined in your lease agreement, so there should be no surprises. Make sure to read the lease details thoroughly, then reread them to make sure you have a complete understanding.
Utilities that you will find in your apartment include electricity, gas, internet/cable, water, sewage and garbage. In most apartments, you will be responsible for paying electricity, gas, and internet/cable bills. Landlords will typically cover the water, sewage and garbage. The cost of this is lumped into your monthly rent. If you are looking for an apartment that has all utilities covered, the costs are likely just lumped into your rent.
Pros of Including Utility Costs in Rent
There are some major pros when your utility costs are baked into your rent. Let’s start with roommates. Including utility costs in your rent eliminates the need to split up the costs. There’s also no squabbling over who used up more hot water that month.
Of course, extras like cable usually aren’t included in your utilities. Ask your property manager and study your lease before you sign. When utilities are included in your rent, they usually include the basics like electricity, gas, and water.
Here are some other pros of including the utilities in your rent.
You Don’t Need to Make Additional Payments
Your monthly utility bills and rent are typically paid at different times of the month. It can take some organization to stay on top of due dates; otherwise, you could incur late fees. Instead of paying your rent, electricity, gas, and everything else on your list, you can make one flat payment with your rent. You never have to worry about forgetting to pay a bill.
You Won’t Have to Deal with Paperwork
Setting up your own utilities is an exercise in responsibility. You’ll need to schedule turning on your service, undergo a credit check, fill out paperwork, and take time off work to allow technicians to come into your apartment. When everything is already included in your rent, your utilities are already on when you move in. All you need to do is pay your rent on time and forget about the rest.
You Won’t Have to Worry about Going Over Budget
It can be challenging to figure out your budget when you’re factoring in fluctuating costs, though including utilities in your rent is a big win if you want to follow a reliable budget. You don’t have to worry about financial fluctuations or setting aside extra money during inclement weather when your electric bill might spike.
Once you know what you’re paying in rent and included utilities, you may find you can afford a nicer apartment than you realized. Of course, you may decide you need to find a move-in special or live a little outside your dream neighborhood.
Cons of Including Utility Costs in Rent
Despite all of the pros of rent included in your utilities, there are some downsides. For starters, you may end up paying connection fees to get your service up and running. Here are a few potential issues to consider before signing your next lease.
You Might End Up Paying More
When your apartment utilities are not included in your rent, it’s hard to tell what you should be paying. Your landlord controls the bills and utilities, and tenants have no choice but to trust they’re paying a fair price for those services.
Many utility companies offer deals on new services or when switching over from a competitor. Instead of taking advantage of those cost savings, you’re likely paying a higher rate on gas for your stove or hot water heater than you would otherwise. When you pay your utilities yourself, you have more control over finding the best deal and lowering your monthly costs.
You Might Not Be Able to Control Your Thermostat
If you naturally run hot or are chilly all the time, you may feel frustrated when you don’t control your utilities. When you don’t pay your utilities, the property manager can set the thermostat and heat to whatever they want. You may also find the water isn’t as hot as you like or that the heat isn’t set to your preferences.
What’s the Average Price of Utilities?
Your utility bills will vary depending on what area of the country you live in and whether or not you live in a city or somewhere more suburban. According to Energy.gov, the average U.S. household spends more than $2,000 per year on energy bills. Heating will take up the majority of your budget, followed by cooling and water heating.
If you live in a hot and humid city or an area that snows all winter, you will likely pay more in electricity and related costs to keep your apartment comfortable. You’ll also pay more for Internet and cable, especially if you purchase a multi-channel package.
How Do I Pay?
If you haven’t paid utility bills before, it’s a pretty simple process. Nowadays, most utility providers will allow you to pay online. Some have options to autopay, which further simplifies the process. The contact information and your utility providers will likely be outlined in the lease agreement, so look out for them. If not, ask your landlord for this information. Be sure to get in contact with the providers a few weeks before you move in, so you can have power turned on and internet ready to go right when you move in. If you are transferring utilities from one address to another, follow this guide.
When Will I Pay for the Utilities?
When your utilities are included in your rent, you’ll pay one bill to your landlord or property manager every month. Rent is usually due on the first of the month, although some landlords may set it to the 15th of the month.
Setting up utilities in your name means all of the bills go directly to you. Some utility providers may allow you to set the date that you pay your bills. It’s essential to pay your utility bills on time and stay in touch with your service providers if you have any financial issues. Otherwise, your utilities could get shut off, forcing you to pay costly reconnection fees and fines to sort it out.
How Do I Split Bills With Roommates?
Moving in with a few roommates, and not sure how you’re going to split up the utility bills? There are a few lines of thinking: split them evenly, based on income, or based on the size of your room. Have an open discussion about how to pay before the first month’s wave of bills hits. Determine one tenant to handle all of the bills, as it makes it easier for everyone. You’ll likely have to sign up for a few different online accounts, so make it simpler by having one person behind each account. Use finance apps like Venmo or Cash App to easily split bills between roommates.
It’s a bit stressful getting your utility bills set up for the first time. Once you have all of your services up and running and payment processes figured out, it’ll become second nature to you.