Depending on the property water bills will very a lot of a little, but many of the factors are in your control. Most 3-4 unit properties will have this basic set up.
Owner pays water – sewer and trash. Anytime a tenant does not pay for something it will be subject to overuse and in some cases abuse. That means if the toilet is leaking it will lower your income and increase expenses, but you’re unlikely to know about it for a while since the tenant really has no motivation for letting you know, unless you make it easy for them to do it, or if you ask.
For a basic property with no grass to water, with desert landscaping, expect bills to run at an average of $40 per unit. This can rise dramatically if you have grass and it can be enven higher if the tenants each have their own washer and dryer. If that is the case you can see bills at $60-90 per unit.
It would seem that you can price it into unit rent price, but that’s not always the case. You can get a premium for the unit having a private washer and dryer, but that premium rarely includes a premium for water use. Take that into account when valuing the property for purchase.
One way to keep on top of lease and lose valves is to ask tenants once in a while if they have any drips or runny toilets. If you send out statements you can include a form that a tenant can fill out with any issues. Be careful with this one as it can open up a Pandora’s box with certain tenants. It’s a balance. Also inspect your property: walk it once in while: look for wet spots on the ground, talk to tenants if you see them.
Water costs are some of the largest monthly expenses aside from a mortgage, so it’s worth keeping an eye on usage. Just a small leak can cost you hundreds of dollars and even several consistent runny toilets can cost you enough to make this extra effort worth it.