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4 Ways Landlords Can Reduce Utility Costs Without Sacrificing Comfort

4 Ways Landlords Can Reduce Utility Costs Without Sacrificing Comfort

Landlords’ utility costs are heating up. Last year, U.S. water costs rose faster than nearly every other household expense. 

The ongoing California drought did little to dampen the visibility of water shortages, and many water distributors had no choice but to raise prices in accordance with demand. Cities across the nation are testing tiered pricing structures to distribute water fairly, but their battle is a testament to the struggles property managers face on a daily basis.

 

Water isn’t just outstripping other household costs, though — it’s beating the regular market by a wide margin. Excluding food and energy costs, the Consumer Price Index rose by 1.8 percent last year, while water costs rose by an average 6 percent. And during the past 30 years, water prices have actually increased faster than oil prices.

 

As if rising water costs weren’t already squeezing landlords, energy prices are also trending up. The cost of electricity will continue to climb and is expected to increase 18 percent by 2040. Although oil might be cheap today, demand for it and other energy resources is poised to skyrocket over the next decade and a half.

 

Landlord and facility management professionals aren’t expected to solve our growing resource crisis, but they do feel the sting of increasing utility prices more than most. For today’s landlords, the challenge is reducing utility expenditures while maintaining the level of comfort tenants have come to expect.

 

Drop Costs, Not Comfort

 

Every residential building, old and new, can make a few simple changes to wrangle utility costs, help the planet, and keep tenants comfortable. These cost-saving tips can decrease landlords’ utility costs without sacrificing residents’ quality of life:

 

1. Fight water waste.

 

Showers and baths account for about 19 percent of residential water use, with the average 10-minute shower using about 40 gallons of water. If a family of four takes 10-minute showers daily, that’s a whopping 58,400 gallons down the drain per year.

While showerheads manufactured after 1992 are limited to 2.5 gallons per minute (gpm), many apartment residents who don’t pay for water tamper with showerheads to increase flow. Residents who tamper with flow limiters on older showerheads can increase water flow to as high as 5 gpm. By limiting flow to 2 gpm or less with tamper-proof restrictors, landlords can save 2,900 gallons per year per family. 

Apartment mangers can also save on water bills by limiting toilets’ water flow, which account for another 28 percent of home water use. Although today’s toilets use 1.5 gallons per flush (gpf) or less, components wear out over time, causing toilets to use more water per flush. A toilet with a worn flapper valve can leak an incredible 7,000 gallons per month. Get toilets professionally inspected to ensure they’re functioning properly, and use manufacturer-approved parts to restore leaky toilets to low-flow specifications. 

Across an entire apartment complex, water savings really add up. At a national average of $1.50 per thousand gallons of water, a 100-unit complex could save thousands of dollars per year just by fixing leaky toilets and limiting shower flow.

 

2. Install LED lighting.

 

LED lights are becoming more popular, but most residential complexes I’ve visited still use conventional incandescent bulbs. LEDs are even more efficient than their compact fluorescent (CFL) counterparts, and they lack the toxic mercury found within CFLs.

For starters, LED bulbs last much, much longer than their halogen and incandescent friends. Not only do they last longer between replacements, but they also use less energy to produce the same amount of light. Replacing a single halogen lightbulb, often found in common areas like lobbies, with an LED upgrade saves nearly $200 over the new bulb’s lifespan. Yes, LEDs cost more upfront, but they certainly don’t cost $200 more than traditional bulbs.

 

As with flow limiters, the more units that are retrofitted with LEDs, the greater the potential savings. An apartment complex with 200 units, averaging a mere five lightbulbs per unit, could save almost $200,000 over 15 years. That’s an average of $13,333 per year back into the property manager’s pocket.

 

3. Swap out old appliances.

 

No one likes to think about the upfront cost of replacing an appliance (let alone dozens or hundreds of appliances across units), but the long-term savings outweigh the initial costs more quickly than many would believe. When an old appliance dies, be sure to replace it with a more efficient ENERGY STAR model.

 

Old and inefficient washers, dryers, dishwashers, refrigerators, water heaters, and stoves are energy black holes. The initial bill to replace these appliances could be thousands of dollars, but even a 10 percent efficiency improvement can improve net operating income for property owners by 1.5 percent. The first year of savings won’t cover the upgrade, nor will the second, but over time, those savings start to accumulate.

 

Exactly how much do property owners stand to gain from installing ENERGY STAR appliances? For a large office building (500,000 square feet), cumulative cost savings can tally up to $120,000 over three years, and the technology improvements can increase the total value of the property by over $1 million. New appliances might carry hefty price tags, but they also offer some of the greatest savings. Tenants will see the appeal of new appliances, and your wallet will enjoy the lower utility bills.

 

4. Invest in a cool roof.

 

Which gets hotter in the summer: a black car or a white one? Darker objects absorb and retain more heat from the sun’s rays than lighter objects, so why do so many property owners insist on continuing to purchase and maintain roofs that only drive up costs and harm the environment?

 

Cool roofs are lighter-colored than their dark counterparts, don’t cost more than traditional roofs over their 20-year life cycles, and have the potential to reduce air conditioning costs in a single-family home by up to 20 percent. Combining a cool roof with a more efficient air conditioner costs a pretty penny in the beginning, but it has the potential to provide enormous cost savings for decades to come.

 

Property managers and landlords don’t have to argue with tenants over utility usage to save a few dollars. With investments in the right cost-saving technologies, savvy property owners have the opportunity to lower their operating costs while increasing the value of their properties — all without asking tenants to change a thing.

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