Utilities for Student Housing: 4 Common Mistakes and How to Fix Them

Learn four common mistakes made when managing utilities for students, and discover how student housing communities can best automate & streamline utility management processes.

Managing utilities for students comes with its unique set of challenges. From allocating utility costs amongst residents, to ensuring efficient usage of resources, to adequately tracking utility expenses, there are many mistakes that can occur.

These mistakes can include inequitable charges, billing discrepancies, and regulatory non-compliance and penalties, just to name a few. Unfortunately, mismanaged utilities are detrimental for business in the long run, resulting in increased costs, billing disputes, and dissatisfied residents.

However, with the right approach and solutions, these challenges can be easily addressed and avoided. Streamlined student housing utility management is crucial for off-campus student housing communities to control costs, promote sustainable energy usage, and ensure fair allocation of expenses.

Keep reading to discover the most common utility mistakes made in student housing, the importance of streamlining utility operations, and how automation frees up resources and safeguards your net operating income (NOI).

The 4 most common mistakes made when managing utilities for students

1. Incorrect allocation of utilities for students
2. Inefficient energy usage
3. Inadequate management of utility expenses for students
4. Staff strain

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The Ultimate Guide to Turn Season Utility Management

Written in partnership with Student Housing Insight, learn how to achieve a smooth and effective turnover process by focusing on one crucial aspect of operations: utility management. In this guide you’ll discover five utility management strategies that can positively impact revenue, conserve team resources, and enhance the resident experience.

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Challenge #1: Incorrect allocation of utilities for students

Many student housing communities divide utility expenses evenly among all residents, regardless of their actual usage. This can result in unfair utility charges, as some residents may consume more resources than others. The alternative is calculating utilities by matching usage to student occupancy. However, when done manually, this method is time-consuming and tricky. Plus, with limited on-site resources, manual management may result in hasty calculations, leading to errors and disputes.

Another challenge of inefficient management is curbing unauthorized utility usage, also known as utility theft. When students avoid paying utilities at the start or end of their lease, properties may end up covering those charges. Effective utility management helps in controlling costs. By accurately tracking utilities and fairly allocating costs based on individual usage, student housing communities can avoid overpaying for utility charges and ensure that residents are responsible for their own consumption.

Vacant Cost Recovery (VCR) tools are a great automated solution for matching unit occupancy with utility costs – taking the risk of manual calculations out of the equation. This guarantees that students are charged fairly for the utilities they consume during their entire stay. By automating complex utility calculations, VCR tools also reduce the likelihood of inequitable utility billing for students.

Challenge #2: Inefficient energy usage

Residents may leave lights or appliances on when not in use, resulting in wasted energy and higher utility bills. Usage trends like this can be overlooked by operators when utilities are managed manually or inefficiently.

Nonoptimal utility tracking often results in missed recoupment opportunities, adding up to financial losses for the property over time. But student housing communities with impactful utility administration can help promote sustainable energy usage and conservation.

By implementing measures such as submetering and utility consumption tracking, residents become aware of their individual energy usage and are encouraged to use resources more responsibly, leading to reduced energy waste. Educating residents on sustainable energy practices can also go a long way when monitoring utilities for students.

Challenge #3: Inadequate management of utility expenses for students

Receiving and paying hundreds of utility bills at a student housing property is not without its challenges. Inadequate management of these invoices can lead to inaccuracies on the ledger and penalties such as late fees for the property. Additionally, inefficient expense management without billing transparency can ignite disputes from students and their guarantors. This snowball effect leads to strained relationships with residents and further administrative burden on staff.

Automated utility expense management ensures accuracy, on-time payments, and less stress on your team. Automated move-out calculators are also helpful in allocating utilities for students. Calculations can be tailored to fit the specific needs of a property, equitably and accurately generating charges based on usage and other customizable criteria.

These tools prevent delays in the billing process and help properties avoid penalties and late fees. By streamlining expense management, operators can enjoy less risk of disputes and protect NOI from avoidable costs.

Challenge #4: Staff strain

One of the biggest hurdles to managing utilities for students is the strain placed on staff.

Handling hundreds to thousands of utility bills for residents requires considerable bandwidth. With operators dividing their attention across competing tasks, it can be difficult to sufficiently manage manual utility billing. This means overlooked or hastily handled utilities – spelling inaccurate bills, risk of non-compliance, and unhappy residents in the long run.

Luckily, tools like automated student utility billing simplify the entire process for operators. From calculating equitable charges based on usage to notifying renters about due payments, automated billing alleviates the manual lift off your team. These tools can also provide transparency to students and guarantors by letting them review their utility costs and payment details. This reduces the need for frequent visits to on-site offices and frees up staff time.

Convergent billing provides an extra layer of transparency to residents by consolidating lease and utility costs into a single, itemized invoice. This billing method clearly outlines all charges related to a student’s occupancy, reducing confusion and disputes. This approach encourages on-time payments and promotes a positive relationship between students, guarantors, and operators – without staff managing the heavy lift.

The importance of managing utilities for student housing

Streamlined utilities are essential for student housing communities for several reasons. With the emergence of utility automation, student housing communities are gladly handing off a few of the necessary evils involved in these processes to the experts.

Overview of utility services for student housing

There are various types of utility services available for student housing communities. These services are designed to help streamline the management of utilities for students and ensure accurate tracking and allocation of costs. Some of the common utility services for student housing include:

• Student Housing Utility Billing

Allocating utilities for students is complicated, and each community is different. Utility billing services involve tracking utility expenses, allocating costs among student residents, and generating accurate bills based on individual usage.

These services automate the billing process and ensure fair and transparent allocation of expenses, reducing disputes and easing the burden on your teams. There are two primary methods that companies use to determine resident’s monthly utility usage:

Billed-by-Unit Submetering

Submetering involves installing individual meters in each unit, allowing for accurate measurement of energy consumption and enabling precise tracking of per-unit utility usage. For a typical multifamily property, submetering can ensure that each resident pays for their actual consumption. This can help to promote responsible and conservative energy usage. In student housing, billing by unit can get complicated in a “by the bed” leasing environment, where multiple roommates share one unit.

RUBS

RUBS stands for Ratio Utility Billing System, and is a cost-effective and fair alternative to submeters. Whereas billed-by-unit submetered properties receive hundreds of invoices, properties that employ RUBS receive one overall invoice per utility. RUBS is a popular utility management solution, and essentially divides the bill among your residents based on certain criteria such as number of student occupants, square footage, or a combination of the two. Different utility types can often influence the type of RUBS formula a property uses.

• Utility Expense Management

Utility Expense Management (UEM) for student housing streamlines the utility accounts payable (AP) process and removes the entire burden of utility AP from your team. The vendor receives your property’s utility bills on your behalf, carefully audit them for accuracy, and pays the accurate charges on time. Vacant Cost Recovery (VCR) services should also be included as part of a robust UEM solution. VCR tools match unit occupancy to utility usage. This ensures that each tenant’s consumption is accounted for and billed. Plus, VCR tools help to identify cost recovery opportunities over time.

Best-in-class providers can offer robust UEM and VCR solutions that track energy consumption, identify areas of inefficiency, and provide insights and recommendations to optimize energy usage and reduce costs.

• Utility Intelligence

With a solid Utility Intelligence platform, you gain access to valuable insights regarding your properties’ utility usage, recoupment rates, and portfolio trends. These tools encourage both urgent and long term data-driven decision making. Smart sensors and submeters can alert you to anomalies like malfunctions or unusually high consumption, enabling operators to make quick and informed pivots before costs add up.

A best-in-class platform will offer you detailed usage reports and insights paired with a user-friendly dashboard, empowering you to make data-driven decisions on the fly or gradually over time. By automating tracking and reporting, operators maximize efficiency and cost control of utilities for students without the manual management of data collection.

Importance of selecting the right services for managing student housing utilities

Selecting the right technology platform is crucial to ensure optima management of utilities for students. It is important to choose a reputable and experienced service provider that offers reliable and accurate tracking and billing processes.

Your selected vendor should also provide excellent customer support to address any issues or concerns that may arise. In addition, they should be able to offer valuable insights that you can use to improve operations.

How submetering and utility billing services benefit student housing communities

Benefits of submetering and utility billing services for student housing

Because effective utility management helps student housing communities with accurate billing, fair allocation of costs, and streamlined utility AP, this can in turn lead to increased resident satisfaction.

Student housing communities that streamline their utility processes can benefit from improved retention rates and a positive living experience for students. Not to mention, efficient management of utilities for students protects NOI from expensive mistakes and unidentified opportunities for cost recovery.

Factors to consider when selecting a submetering, utility billing, and expense management provider for student housing

To achieve success, it’s essential to select the right utility management service for your community. There are various types of managing utility services, including submetering, utility billing, and expense management, which can greatly benefit student housing communities.

Use the following criteria to carefully select the right solutions platform for your student housing community:

• Is this a reputable and experienced service provider that offers reliable and accurate tracking and billing processes?
• Do they generate convergent bills for your students that include both detailed housing and utility fees to make payments easier?
• Do they offer e-billing to encourage students to receive and pay statements online?
• Do they provide an automated mass-move-out calculator that calculates final utility charges for a group of students, posts to your ledger, and generates the bill on your behalf?
• Will they thoroughly audit your utility bills and resolve exceptions on your behalf?
• Do they provide vacant cost recovery (VCR) functionality that automatically brings together unit occupancy and utility bill data to help recoup vacant utility expenses?
• Do they provide excellent customer service and support to address any issues or concerns that may arise?
• Are they able to provide you with valuable insights that you can use to improve operations?

Choose wisely. The right utility partner can streamline your processes, reduce costs, promote responsible energy usage, and help you make informed business decisions.

How to maximize the efficiency of your student housing utility program

To maximize the efficiency of your student housing utility program, you should actively collaborate with your utility management provider. By working together, you can achieve maximum results in key areas such as improved energy efficiency, better allocation of utility costs, and enhanced resident satisfaction.

Improved energy efficiency

Partner with a utility solutions team to implement energy-efficient practices throughout your student housing community. This can involve conducting energy audits, identifying areas of energy waste, and implementing solutions such as LED lighting, programmable thermostats, and energy-saving appliances.

Ask your utility management provider about consumption tracking to stay on top of anomalies that may indicate malfunctions and lead to unusual usage and high costs. In the same vein, leverage your technology to monitor consumption trends over time. Maintaining long term data tracking will help you identify usage waste and opportunities for cost recovery.

By promoting energy-conscious behavior among residents and continuously monitoring energy usage, you can make significant strides in improving energy efficiency, ultimately reducing utility consumption and costs for both the community and your residents.

Better allocation of utility costs

Work closely with your utility solutions vendor to ensure accurate and fair allocation of utilities for students. Through effective submetering and utility billing services, individual residents can be billed equitably based on usage, rather than a flat rate.

Vacant cost recovery services can ensure consumption is accurately matched back to occupancy data. It’s vital to understand how your provider calculates utility costs, especially if the process is done automatically. Move-out calculators are also a great tool to help determine utility charges for large groups of students.

These tools promote transparency and fairness in cost allocation, preventing any discrepancies or disputes among residents. Collaborate with your utility billing provider to establish clear guidelines and policies regarding utility cost allocation, ensuring that each resident pays their fair share and creating a sense of equity within your student housing community.

Enhanced student satisfaction

Maintain open lines of communication with your utility management team to address any concerns or issues promptly. Regular meetings, performance reviews, and feedback sessions can help identify areas for improvement and ensure that your utility management program aligns with the specific needs and preferences of your community.

Another way to leverage technology is to focus on improving student satisfaction through the billing process. For example, offering clear and transparent itemized billing is a great way to get on your resident’s good side. This lessens the risk of disputes and office visits, and allows students and guarantors to understand how their utilities are charged.

By actively addressing resident feedback and providing transparent payments and billing, you can significantly enhance resident satisfaction by mitigating confusion and disputes, creating a positive living experience across the community.

Improvements in staff efficiency

Look for ways to maximize efficiency through your utility management program. Simply put, leverage tools that take unnecessary tasks off your on-site team. By streamlining utilities for students, your provider frees up time for staff to focus on operations that require a human touch and drive the business forward. For example, automation tools are capable of processing hundreds of invoices quickly and accurately. This mitigates the chance of errors compared to manual calculations done by staff.

Connecting with your provider on services that alleviate the burden of utility management gives owners and operators the freedom to focus on goals and handle human requests. Ultimately, this drives improved efficiency, profitability, and long term success for your portfolio.

Airtight regulatory compliance

Consider looking into solutions vendors that offer supplementary compliance support. These partners may offer insights into regulatory requirements such as local regulations and guidelines around tenant billing. Some partners even provide support in the form of a team of experts that can monitor your utility data and help your staff navigate regulations and legislation specific to your property’s location.

Utility management providers that offer an all-inclusive approach through both software tools and expert compliance provide invaluable support to student housing properties. Operators enjoy enhanced efficiency, less risk of penalties, and less risk of billing discrepancies.