rental HMO with Bill included

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    rental HMO with Bill included

    Planning to rent a student HMO with Bills included options. I never done this before with a bill included option but most of the students seems to prefer this.
    I use the standard NRLA template for AST for whole property.

    Question is - All bills included AST option should have a fair usage clause and what the bills cover. How is this worded into the tenancy agreement..any example/template for this please?

    #2
    I avoid the HMO market completely, but I would definitely not do bills included. Charge less rent, grant a joint tenancy, and make the tenant responsible. It is not so much what the students prefer - but what is practicable and sensible given the service constraints.

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      #3
      I am in the same position.
      Norwich now has a glut and one needs to do the necessary in order to secure Tenants.
      For donkeys years "exclusive" was the norm. Now it's shifting and thus in some cases I offer "inclusive".
      I use the Clause below and £50-£60 pppm always covers the bills.
      Obviously I also have a Guarantor for each Tenant.
      It is more admin etc but heyho, the houses are let!
      PS:
      I am 100% students.

      (G) “Utilities” comprise of Gas, Electricity, Water Rates, Internet fees and TV licence. These will be in the name of the Landlord who will reconcile them (with readings) on a Quarterly basis and adjust each Tenants (equal) share accordingly.
      Any credits will be returned to the Tenants equally, whilst any shortages will be billed to the Tenants (equally) “at cost” with supporting Invoices from the utility Companies.
      The Tenant will pay these Billed amounts on the 1st of the following month.

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        #4
        I agree with you that student tenants prefer bills included rents and despite the obvious issues, I think this is probably what you should do. If you want a fair usage policy then you need to first find the average usage for household of however many adults. Your utility providers may be able to help. I would then add 5-10% and specify that number of units of each utility as being included with the rent. You will also need to specify in the contract what will happen if the use more than that. You will need to be able to monitor the usage and take accurate readings, so perhaps some kind of smart meter and a remotely readable thermostat or heating control in the property. You will also have to bill for any excess in arrears to ensure you don't fall foul of the Tenant Fees Act and be careful to only bill the exact excess used. A combination of these things plus cajoling the tenants should be be enough to not lose your shirt.

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          #5
          If you do bills inclusive you will inevitably end up renting 'room only'. This is more time consuming than a normal joint and several let as you will be responsible for the communal areas and should really employ a cleaner and visit frequently. So think about that before proceeding. Also think about how you will deal with damage to communal areas without the ability to pinpoint who is responsible. Not a huge problem if you carefully select tenants, but with students????

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            #6
            A couple more points:
            1. The norm for student lets (certainly here in Norwich) is "joint and several" as they view in pre-organised groups of anything from 2 to 8. These are groups that have formed in their first year in halls. If you are lucky and they are a cohesive group, they will stay for a 2nd year. This year I have 2 lots of 6 who have just confirmed they will stay for the 21-22 academic year.
            2. The one thing you may consider not including is the tumble dryer. Personally I do but know a largish Landlord (whose properties are all "en-suite & all-in"), who puts the tumbler on a "pay as you go" slot mechanism although I am probably behind on this and nowadays they probably just wack it with an iphone in order to pay!
            3. I do sometimes have to go for "room only" when a house was late to market etc. In this case, I usually fill it with post-grads and whilst somewhat time consuming these guys are typically quiet, fairly tidy and studious. Yes, it may be left needing a proper clean but they are certainly not vandals.

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              #7
              I put a coin operated tumble dryer in a HMO but it was hardly used - clothes on the rads dried for free!

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                #8
                All of my HMO rooms are bills inclusive and last time I looked on spareroom all rooms in my area were advertised as bills included. While renting myself in HMOs over several years only once were bills not included and that house was damp as residents didn't have heating on much to lower bills.

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