Utilities are one of the most common causes of rental disputes. Not because anyone cheats, but because nobody wrote down who pays what, when and on what basis. A simple routine that works the same way every month prevents most disputes.
What counts as utilities?
The word means something different to everyone, so list it item by item:
- Electricity, by meter.
- Gas or district heating, by meter or by statement.
- Water and sewage, by meter.
- Common charges (közös költség), the fee set by the condominium.
- Waste collection, if it isn't part of the common charges.
- Internet and TV, if the subscription is the landlord's.
Most disputes are about the common charges and heating. Part of the common charges is the owner's business, for example the renovation fund, while another part comes with using the flat. How much of it the tenant pays must be set out in the contract.
Whose name should the meters be in?
When you rent out a flat, the utility contracts usually stay in the owner's name. The tenant then pays the utilities to the landlord, based on meter readings or the bills.
The other option is for the tenant to transfer the utility contracts into their own name. That's less work for the landlord but more admin for the tenant, and it has to be switched back at the end of the lease. It can be worth it for longer leases, rarely for shorter ones.
If the meters are in the owner's name, make sure the bills are always paid on time. An unpaid bill falls on the owner, even if the tenant didn't pay.
Who reads the meters?
Agree it up front, for example: on the 1st of every month, the tenant photographs the meters and sends the photos. The photo is the proof, not the number typed in. Record the starting readings at handover.
Flat fee or actual consumption?
There are two basic models:
- By actual consumption: a reading every month, and the tenant pays for what they really used. Fair, but it means work every month.
- Monthly flat fee with an annual settlement: the tenant pays a fixed amount every month, and once a year you settle up based on actual consumption. Predictable, but there can be a bigger difference to pay at the end.
For heating, a flat fee is often better, because winter months can be very expensive. For electricity and water, settling actual use monthly is simpler.
Whichever you choose, put it in the contract. For the landlord, how utilities are handled can also matter for tax. We covered this in our article on rental income tax.
For flatmates and renting by the room, splitting costs is covered in this article.
Three rules for clean billing
- A fixed day: readings and billing happen on the same day every month.
- Photos: a dated photo with every meter reading.
- An itemised summary: which meter, how much was used, at what unit price.
A simple monthly summary looks like this:
- Electricity: 4,120 → 4,286 kWh, 166 kWh × unit price = amount
- Gas: 1,830 → 1,902 m³, 72 m³ × unit price = amount
- Water: 312 → 318 m³, 6 m³ × unit price = amount
- Common charges: as agreed
- Total, and the payment deadline
Take the unit price from the provider's bill, and flag it if it changes. That way the tenant can see exactly where the amount comes from.
If the difference is big
If consumption suddenly jumps in a month, don't start with an argument. First check:
- whether the meter was read correctly, and the figure didn't come from an older photo,
- whether there's a leak, for example a running toilet cistern,
- whether the unit price changed,
- whether the period was different, for example a longer month or colder weather.
FAQ
Who pays the common charges in a rental?
It's a matter of agreement. Often the rent includes them, but it's also common for the tenant to pay the usage-related part separately. The renovation fund is usually the owner's.
What if the tenant doesn't send the meter reading?
Estimate based on previous months, and settle up at the next reading. If it keeps happening, set out in the contract what happens in that case.
Is the tenant entitled to a copy of the utility bill?
If they pay for actual consumption, they can ask for it. It's more transparent if you attach it to the monthly summary.
Make it simpler
In Rentkey, meter readings go onto the flat's data sheet together with their photos, and you issue the charge to the tenant from the same place.
