I am a new landlord and my tenant has outstanding water usage bills.
Am I legally allowed to deduct this amount from the rent recieved, which will put them in arrears? I didn't include a clause in the agreement.
I am in NSW.
Thanks
If it is a unit you may find that the water usage is your responsibility. Many units are only metered to the building (not individually), and the landlords split the usage bill.
If it is a house and they have their name on the water usage account (and you are on the rates account) then it is their problem and the council will be after them.
If there is no clause in the agreement for them to pay the water usage then you are responsible unfortunately. You can rectify this in the next lease renewal.
The tenants won't like it, but the chances are they were expecting to have to pay it when they moved in, but because there was nothing on the agreement about it they chose to say nothing and "punched the air". I'm sure they will cop the expense in the new lease. Just warn them ahead of time (through your Manager if you use one – and you should).Hi there
A Lessor can charge the tenant for all consumption where individually metered and there is a term in the
agreement.
Your lease is a contract and unless there is a provision which specifically states that you can deduct water expenses from rent received (which could put the tenant in arrears) – then you are not permitted to do so under your agreement.
thanks
Thankyou for the replies, the IP is a townhouse and is individually metered. I did include a clause that states the tenant is to pay for water usage, however I did not include a clause that says should payment be overdue the landlord shall decuct the outstanding amount from rent recieved.
Cheers
Hmm, I have had this question for a long time but it has never been that important, but seeing as it looks proper in this thread.
Ok, so you draw up in the lease, the tenant pays for their water consumption, they have 5hr showers they pay for it. what about electricity, is it the same deal?? they use, they pay?? Also with all the water restrictions, what happens if the tenants get caught spraying water say on the driveway, when they are not supposed to and incur a fine, who pays for this fine, them/you?? does it have to be written up all of this for it to go your way.Also all of these questions are for houses, not appartments.
So the expenses that we as landlords have are interest, management fees(if we have em) and rates. Is this it??
Hello Jade
May I ask why do you specifically want to deduct it from the rent? As it's in the lease, they are liable. Get your PM to send them a copy of the water bill with a "please pay" next to the water consumption amount. The PM could even include a copy of the relevant section of the lease, just as a reminder.
Or have they refused to pay? If so they are in breach just as if they had had not paid the rent or part of the rent, surely.It's orgaised better in Melb. I get the service bill and the tenant gets the usage bill directly. No hassles.
Hello DraconisV
Gas and electricity are different. The tenant gets these utilities connected and disconnected and receives the bills directly. Nothing to do with the landlord.
A far as breaking water restrictions, I don't know for sure but would imagine it's a case of "he who sins, pays". i.e the tenant if they get caught will get the fine directly.
Cheers
ElkaI have over $1500 owing on excess water bills and am having difficulty recouping, My PM is really useless or maybe it's me. I have to manage the manager better. This tread reminds me to give them another call.
Cheers
Hi Jade_C,
Thanks for your post and I'm sorry to hear that you are having troubles. Certainly, it sounds like it is time to find a new PM, and one good way to find a new one is to ring around and see who is happy to help you with your problem.
I am not an expert in NSW rental law, but some quick research here in Vic reveals that a tenant is liable for water useage. I would imagine then that most leases would be worded such that the rent is first applied against outstanding expenses and then applied to discharging the rental due.
If, upon termination of the lease, there is a shortfall on the rent collected or on expense reimbursement then I would try to recover that from the bond. Failing that you could try to sue the tenant, but the cost and stress of doing that is unlikely to be worth the hassle.
Keep looking for the solution though and don't allow things to pad out. Be pro-active.
Bye,
Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Hello whyalla
$1500 ???? You've allowed it to slide too long and now it's an amount that may be a problem for the tenants to pay in one go.
Maybe get your PM to send them a last reminder together with what the consequences are of being in breach of the lease. You may like to offer them the option of paying it off in instalements. i.e 3 X $500 if you think they may need it.I would also have a serious talk with your PM if I were you. If you can't get better management then change.
I assume you hold one months rent as bond but who wants to have to go that route.
Good luck
ElkaThanks Elkam, also you just mentioned that they assume they have one months worth of rent as a bond. Is it only one months rent as a bond, whats the usual amount($ or time), would the tenant be scared away if the bond was slightly higher as I would like to protect myself as much as I can.
Sorry, DraconisV, I don't know if it's possible to charge more than one months rent but if I had to guess I would say no (at least in Vict.). I've never had an agent ask if I wanted a bigger bond from a tenant.
I just looked up the REIV leasing and managing authority document and it gives two options for bond. 1 month and other … but I'm guessing the other is for less.
Your best protection is:-
1. An excellent PM
2. Good landlords insurance.Cheers
Elka
The water bill is directed to me, and I just charge the tenants for their actual water usage.
I found out that they had requested an actual copy of the bill which my PM did not send them, I am angry about this as the tenants are entitled to see the bill as I am a tenant myself and I always request a copy of the bill, so I told the PM to send the bill but they still haven't paid.
I called CTTT and they said it was illegal for me to deduct the expense from their next rental payment.
Time for a new PM I think.. At 21 this is my first IP and it has been nothing but a hassle!
Don't let this unfortunate experience put you off. Learn from it and keep on investing. At 21 you will be a wealthy person by 40 years of age.
So if you write up in the contract at the start that the tenants will be paying for the water on top of their usual weekly rent. Then does that mean your covered, i know they can refuse, but you could take this to the tribunal and win(could you??).
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