Emily, we have the same situation in Brisbane as in Sydney.  It is a huge pain & would definately be easier if water was invoiced directly to the householder.  Recently our councils amended billing so as water is invoiced seperately to rates.. this doesnt help property managers though as now we have to pay rates & water seperately for the owner, then calculate tenant charges & invoice them.

At least you have it where you are. Our council has just decided to separate water and rates as of 1.7.2010. It is causing a lot of angst here for owners, agents and tenants. There are options on what to do…owner pays all water, owner pays water : tenant pays excess or tenant pays water. They have changed the wording and it is confusing everyone and the agency nightmare is about to begin.

The main questions seem to be: What is a fair allowance of water, if owner pays, and tenant pays excess. CURRENTLY it is 772kltrs. We have heard some discussion about it recently but everyone is deciding their own “fair allowance” instead of agreeing on a “across the board” fair allowance.  AS FOR THE EXTRA PAPERWORK….waiting with baited breath….do we charge, or is it part of the service?

If the property is seperately metered deemed water efficient, ie correct Wels Rating etc etc  then its really not a hard thing to deal with.    Water meter reading taken by Property Manager with Entry Condition Report, and then at each routine inspection.   Its then easy to calculate the water usage and invoice the tenant.      Now that owners must pay for all water usage at the property there really shouldnt be anything such as excess water anymore.  User pays.

I have many concerns about this debit collection for water.

 If the tenant pays all is fine. It would give require a letter to tenant of what the water bill was. They pay it, we receipt it and pass it on to the owner at disbursement time. But what happens if the tenant doesn’t pay when required. Then a debit collection process has to kick in. I visualise this turning into another arrears process like rent arrears with a series of letters, sms, phone calls, remedy breaches, notice to leaves, court action etc etc all over a small amount of money.

If the property has is deemed water efficient and tenant pays for all I feel that this would be the worst option of all. All plumbing repairs would have to be dealt with as an urgent otherwise tenants complaints would go through the roof. This would put more strain on creditors to do the jobs immediately And what happens if there is a burst water pipe? Should the tenant still pay for all water where there is use outside their control? How would you determine how much water was wasted due to the burst water pipe that could go to the owner? And what do you do with a property with a large yard and/or extensive gardens or a pool? Why should a tenant pay for all water to maintain these when these things belong to the owner. A bore could be installed but that is another thing that needs to be maintained and an extra expense for the owner.

I believe that the owner and the tenant should share the reponsibility for water useage. I think the owner should provide a reasonable amount of water and then tenants pay for excessive use. The problem is what is deemed as reasonable? The previous allocation was 772KL in Townsville whereas a typical household only use between 400-500KL.

So should the owner still go with the status quo of 772KL or should they drop the allocation to 500KL or should the allocate more for the properties with large yards and/or gardens and/or pools?

Regardless of which option the owner chooses there are consquenses that will occur—some favable to the owner some not.

Another main concern I have is the time,effort and cost in collecting money from tenants for water. I would like to charge owners differently depending on which option they choose.  I was thinking of charging a smaller amount for the owners that share the cost of the water useage than to the owners that pass all water charges to the tenant. The main reason for the extra charge for the second option is because I visualise it taking more time to collect the money from tenants with all water charges than it would from the ones that only pay if the water useage goes into excess. The reason I visualise this could happen is because the amount would be generally higher with the first option and there would be a higher probability of a debit collection process needed.

Are other people charging to collect money for water useage and if so how much are you charging?  I was think of charging $25 per quarter for the properties that have all charges to the tenant and only $10 for the properties where the owners and tenants share the costs. I was only thinking of charging the $10 if the water usage goes into excess and we actually have to do something otherwise we would not charge anything if there was no work to do. I’m not sure if this amount is excessive or if it not enough. Some thoughts on the matter would be appreciated.

Margaret www.dmrealty.com.au

Surely this could be outsourced and the owner charged for the service? Does anyone know of a company offering this service?

That is such a good idea Ross but at what cost would another company charge? I’m sure no other company would deal with is for the small amount of money I am proposing. I’m only suggesting this small amount as I know that owners generally don’t want to pay too much and expect us to just keep doing more and more for free. At least the small amount of money I’m suggesting may help recoup some of the costs it would take to deal with this debit collection matter.

Margaret www.dmrealty.com.au

Thanks Margaret, I think the charge from a third party company would be around the same cost as you are proposing. Judging by what is currently charged for smoke alarm compliance and routine inspection out sourcing.

If it was out sourced from the point of meter reading all the way through to generating a customised invoice (with agent logo etc) that was delivered to the tenant, the PM would then only need to chase up payment of said invoice – which could become part of the arrears procedure of an agency.

For Lessors, if the cost of reading the meter exceeds the cost of the water useage itself they really shouldn’t be bothering with it in the first place really!

I personally believe that the process is not too time waisting or difficult. i enter the info into our REST system, which automatically generates both a posted copy and an emailed copy straight to the tenant. We also have automatic sms reminders each week. We very rarley have a tenant that doesnt pay.

I also give the tenants the option of paying $5 extra each week with their rent in order to have a reserve for their water bills. this way they dont have a lump sum to come up with, which many people cannot afford to do. This also helps reduce any non payments from tenants.

Is doing this service for the owners not what is expected of us, and what we are paid to do?

Keira, I think that because so many of us have managed properties without the water charging, when it came in it seemed like a whole lot of extra work.  Now it’s just another task on our checklist of daily items. Sometimes it is concerning that more & more is expected of us property managers, yet our fees don’t increase to cover the additional work.