Renting out a granny flat has become easier thanks to the reduction of government regulations, but there are still some logistics that you will need to sort out before you rent out a property.
One of the biggest decisions you need to make is whether you are planning on having separate utility meters installed for your granny flat. This is so you can quantify and charge the tenant for their gas, water and electricity, among other services.
Alternatively, you could decide to charge a rental price that includes bills. Or if it’s a family member renting the granny flat, you might not charge them at all. These are just some of the things you need to consider.
What type of granny flat do you have?
In addition to who you are planning on renting your granny flat to, whether you have an attached or detached granny flat will have a big impact on whether you have a separate granny flat water meter for example.
Attached
With an attached granny flat, which usually means a part of your existing home has been sectioned off, with separate bathroom and cooking facilities, and its own entrance, it’s much harder to have a separate meter. These types of flats often involve renting out to family members or short-term lets or AirBnB, so it can be easier not to worry about including bills.
Self-contained
If, however, your granny flat is self-contained and on a separate part of your plot to your main residence, you may want to think seriously about getting a separate water, gas and electricity meter for your granny flat.
Are you renting your granny flat out, or keeping it for the family?
Even if you are renting to a relative or family member, or even letting them stay there for free, it can be worth having a separate meter. This isn’t for charging them; it’s so that you can track and record how much electricity, gas or water is being consumed in the granny flat. This will alert you to any maintenance or repairs issues if bills suddenly soar, as well as giving you an idea of your energy footprint.
What are the legalities around having separate utility meters?
There is no legal requirement to have a separate water meter for your granny flat. The same applies to both a separate gas or electricity meter for your granny flat. If, however, you wish to charge for your utilities you will need to have meters or submeters installed. The Department for Mines, Industry Regulation and Safety has more information on its website.
What are the advantages of having separate meters?
There are lots of advantages to having separate meters, particularly if there is ever any dispute around the rent or cost of your secondary dwelling . In addition to protecting yourself legally, it can also be good for your own records and to help you plan, budget and manage your finances and usage accordingly.
Record usage
Having a water meter for your granny flat or a separate electricity meter for your granny flat is a good way for you to understand the breakdown of utility usage across your own home and your granny flat.
Spotting spikes in usage or peak times could help you manage your finances better or advise your resident about their own electricity or water usage. For example, if there are energy usage spikes in the evening or early mornings, you could informally discuss whether there are better times of day to use appliances and so on.
Having a record of usage will also help you identify any potential issues with your utilities. If a bill suddenly skyrockets or there appears to be usage at strange times, it could be the first indication that there’s a leak or blockage.
Charge accordingly
There is also a financial incentive to having a separate gas meter and meters for other utilities. By measuring how much water and energy your tenant is using, you are able to charge them accordingly. If you are unable to quantify how much they are using, you are legally unable to charge them.
Installing a separate water meter for your granny flat
You can install a separate water meter for your granny flat, but you should consult with an experienced plumber beforehand, so that they can advise you on the best location for the water meter. You will then need to notify your local council, in case you require approvals or permissions. The meter itself will need to be installed by the plumber to ensure its safety and efficiency.
Installing a separate gas meter for your granny flat
Where natural gas is available on a property, you can apply for a separate gas granny flat meter. It is a simple process, but does require applying to your gas supplier for permission, as well as the cost of the meter, and the installation costs, which must be done by a professional, registered gas fitter.
Installing a separate electricity meter for your granny flat
Again, when it comes to installing a separate electricity meter for your granny flat, it must be done by a professional. An electrician will be able to advise you on the meter’s location and ensure that it complies. Both your supplier and local council may require documentation or to give approvals but this will depend on both your location and your provider.
While the process sounds complex, it is relatively simple but it does involve various administrative steps. And it can be costly.
Are there any disadvantages?
It is worth bearing in mind the disadvantages of installing meters when deciding whether you are going to install them. The installation may involve an additional cost, as well as administration. This is why it’s important to consider who you intend to house in your granny flat, and whether it’s worth going through the installation process, before you begin.
Cost
It does cost to have an additional water, gas or electricity meter installed at your secondary dwelling. Not only is there the cost of the meter itself and the cost of the installation but there will also be all the usual charges associated with opening an additional account, such as administration and account charges, which will again vary, depending on your provider. For adding a water meter to your granny flat, for example, you will be charged to cover the cost of the water service connection, activation fee and infrastructure contributions for both water and, if available, wastewater.
Administration
Having more than one meter means doubling your amount of administration. Whether that’s setting up direct debits, scheduling maintenance, or calculating costs to pass onto the tenants, be prepared for the extra work involved. That said, given the potential protection that a separation of utilities will afford you in terms of records, and a written audit trail, this could be a small price to pay.
If you have any questions about the administration involved in setting up a granny flat, or constructing one, don’t hesitate to contact our team. Alternatively, come to our showroom and see our granny flat displays homes in person.
