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Tenancy Tip Thursday - Who pays water?

Discussion in 'Property Management' started by D.T., 26th Nov, 2015.

  1. D.T.

    D.T. Adelaide Property Manager Business Member

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    Hiya's,

    One very common dispute during tenancies is over who should be paying for the water.

    The rules vary a little between states so its important to refer to both the Residential Tenancy Act applicable to your state and also the lease agreement on what is specified.

    Here in SA, the rules changed a little since 2014, whereby if the lease makes no mention of water then the tenant is expected to pay for both the usage and the supply charge, but not the sewerage or the "Save the Murray Levy" (now defunct) components. This is the default option, though not the only one. You may agree to pay the whole bill, just the supply part and have tenant pay the usage part, or even a base level of usage if you so wish. It's always best to discuss this upfront and write it into the lease agreement so that there is no arguments later on. You may wish to base the decision on rental demand (offering to cover the water supply is a perk) or on the extent of gardens at the property (tenants are more likely to water them

    From when the water bill is issued, payment must be requested of the tenant within 3 months and if requested by the tenant, a copy must be provided to them within 30 days. One method I use is pay the whole bill on behalf of the owner, then invoice the usage portion (and the supply portion if agreed upon) to the tenant. This way, the owner isn't subject to any late fees or credit file hits if the tenant doesn't pay it straight away.

    At the start and end of the tenancy, you can use water meter readings to calculate pro-rata portion of their usage to be within the dates of their tenancy.

    If there are multiple properties associated with 1 water meter, you need to agree on how water charges will be calculated. Perhaps dividing it evenly might be one option, but depends on the circumstances at hand.

    If there are water leaks in the house, a tenant can dispute their water charges as this could lead to higher than normal bills. However, they need to have submitted a maintenance request in writing prior. One last snippet of legislation is regarding over due amounts - if a tenant has overdue rent and water, any money they pay must be allocated to rent portion first and foremost.

    In other states, most of the above applies with the following exceptions:

    In WA, the default position is for the owner to pay the 'water rates' (as they call them) and for the tenant to pay for usage portion. These bills come every 2 months now with both charges on them, so it's important to pass on the correct portion.

    In QLD, the tenant only pays the usage portion and only if water efficiency standards have been met. There's no provision in this state for multiple properties on a water meter, they have to be separately metered. There's also options here for the landlord to pay for the water use, either in total or up to an agreed level.

    In NSW, water efficiency standards are also required similar to Queensland. Here, the tenant only pays for usage and the owner must pay supply charges. Tenants here have 21 days to pay their portion.

    In Vic, separate water meters are a must and tenants pay the consumption portion and sewerage disposal fees. The owner must pay the the supply charges.

    I hope you all learnt something new. Let me know if you'd like me to add or clarify any information.

    Cheers,

    Dave
     
    Last edited: 30th Nov, 2015
  2. thatbum

    thatbum Well-Known Member

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    Unfortunately, since the 2013 amendments, landlords can no longer 'contract out' of paying for the water rates by passing them onto the tenants.

    There's also been some confusion since the recent water corp billing changes to bi-monthly. The rates and usage charges now come on the same bill on the water corp paperwork - make sure you have a closer look and only pass on the usage charges to the tenant.

    I've worked on quite a number of matters for tenants who had to recover monies back from their landlord for trying to charge the rates - sometimes inadvertently, sometimes not.
     
  3. D.T.

    D.T. Adelaide Property Manager Business Member

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    Thanks I'll update it to reflect recent amendments for your state :)
     
  4. Zepth

    Zepth Member

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    NSW can charge usage only not supply costs
     
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  5. D.T.

    D.T. Adelaide Property Manager Business Member

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    Yup, similar to WA where used to be able to specify whether supply was included or not. Happy to re-word it so we can have an Australia wide resource :)
     
  6. Johnny Cashflow

    Johnny Cashflow Well-Known Member

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    Good info!

    A lot of people don't know how this works.

    I personally do as you said. I photo copy the whole bill and then give the tenant the copy so they can see how much they are using and what they have to pay.
     
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  7. Wall Street

    Wall Street Well-Known Member

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    In Vic, separate meters are not necessary in older strata blocks. The downside is that the LL can't pass on the usage costs.
     
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  8. D.T.

    D.T. Adelaide Property Manager Business Member

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    Yup, I refer to legislation now - you can't do that in strata blocks created now but there's no requirement to change over previous ones. In Victoria this means no passing on of the costs, whereas other states allow you to come up with your own method - ie splitting it by number of units.
     
  9. Wall Street

    Wall Street Well-Known Member

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    Looks like it's time to invest interstate!
     
  10. D.T.

    D.T. Adelaide Property Manager Business Member

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    In terms of water, I think SA is the most generous as the default position is for tenant to pay for the supply as well :)
     
  11. Lil Skater

    Lil Skater Well-Known Member Business Member

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    Fun fact Monday (doesn't have the same ring, does it?).

    Unlike other states, Victorian water companies invoice the tenant directly. No chasing usage charges with the rent!
     
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  12. D.T.

    D.T. Adelaide Property Manager Business Member

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    I wish ours did that lol :p
     
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  13. Wall Street

    Wall Street Well-Known Member

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    So many learnings today!!!
     
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  14. GoOnAndTell

    GoOnAndTell Well-Known Member

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    Yer but watch your bills, twice maybe even three times the water usage has popped up on our bills. Different water providers, their default position seems to be stuff the process bill who ever we can.
     
  15. JacM

    JacM VIC Buyer's Agent Business Member

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    Not quite correct on the QLD front. Here is a snippet from the managing authority document (Form 6) which clarifies. QLD water bills.JPG
     
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  16. D.T.

    D.T. Adelaide Property Manager Business Member

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    Great, more information benefits everyone :)
    I mentioned the first option, which is tenant pays and only if efficiency standards have been met. This is the most common option in my experience, but I'll add the other options in if you like? How common have you found them with the properties you deal with?
     
  17. JacM

    JacM VIC Buyer's Agent Business Member

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    Generally newer properties are already water efficient. Properties that have a few years on them are not, but a visit from the plumber can sort that out quick smart. A water efficient showerhead etc etc and you're suitably water efficient.
     
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  18. D.T.

    D.T. Adelaide Property Manager Business Member

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    Exactly :)
     
  19. Darlinghurst Boy

    Darlinghurst Boy Well-Known Member

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    Sydney Water $184.35 every Quarter !!!
     
  20. property world

    property world Well-Known Member

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    As im aware my tenant recieves a seperate bill under his name that is sent to the properties address and i recieve the rates every 2 months by email.

    It varies between 90-120 for rates every 2 months and theh pay a usage fee which is much smaller.

    I do all my payments online.

    I hope im not over paying and have this right as far as im aware i do.