The latest research from Freddie Mac shows that renters are more worried about rising utility bills than rising rents. Nearly half of the renters surveyed say they’re willing to pay more for rentals that have cost-saving water and energy features. A large majority (88 percent) said that multifamily properties with green energy- and water-saving features would help reduce their utility bills, with 84 percent saying that green properties are generally better places to live.
This is great news if you are a property built in the last five years that is individually metered and built with a host of energy star features, but what about the other 85% of multifamily properties that don’t have that advantage and are trying to pass through higher utility costs using a RUBS (Ratio Utility Billing System) program in a growing base rent environment?
Fear not, there are options. While energy conservation upgrades don’t seem exciting and certainly don’t have a history of directly providing any great ROI to an owner, they do provide a soft return in being able to sell and tap into that green energy savings story that the Freddie research supports.
Below are just a few examples of the low hanging fruit available to owners looking to be greener energy consumers:
-Low flow toilet retrofits and shower heads
-LED bulb upgrades inside and out
The result might be coming closer to collecting 100% of utility costs and being able to stabilize RUBS fees and enable your leasing team to sell your property as a responsible steward of the environment. This might just earn you better occupancy and a tick up in rent.