Cutting costs is always a high priority for landlords in Hawaii and most would not think twice about denying a tenants request to pay for a utility bill. Honestly, who could blame them? The tenants are the ones living in the home and they’re the ones using the utilities.
Why is this an issue?
Depending on what state your property is in, you may or may not be required to reimburse the tenant for high utility bills. For those who are not required to reimburse the tenant, it is not necessarily in your best interest to take a firm stance and deny their request.
Things to consider
First and foremost, repairs that contribute to high utility consumption are a good reason to reimburse the tenant. This of course takes the cause of the repair into consideration. For example, if a tenant accidentally leaves the bath tub running and the house floods, this is not a justifiable reason to credit the tenant. However, high electric bills because of a old worn out AC system that breaks down or a water main leak that increase the tenants water bill are perfect examples of when a landlord should consider crediting the tenant.
Another important consideration is turnover, which is one of the biggest expenses an investor faces. If a tenant is requesting reimbursement, and the cost is within reason, it would be worth considering and posing to the tenant either a full or partial credit if they sign on for another year.
Examples of reasonable requests
- Underground irrigation leak
- Power and water consumption during a water loss (not caused by the tenant)
- Performing a water change on a pool
- Old appliances, electric water heaters, etc. that consume excessive electricity
- Pool leak and faulty equipment
Examples of unreasonable requests
- Misuse of appliances
- Taking excessively long showers
- Running toilet or dripping faucet that was not reported
- Overwatering plants (unless its controlled by the landlord)
- Increased power consumption during the summer
- Higher water bills during the summer for homes with a pool
In general, landlords should not box themselves in and take firm stances when it comes to requests. There normally is a good reason to honor the tenants request and ultimately, long term tenancy is every landlords goal (or it should be).
November 11, 2013