Tenants Beware: Hidden Costs and Fees

Kimberly Bean
Kimberly Bean
Published on April 13, 2016

The Southern Maryland rental market has boomed in recent years. Data from the most up-to-date U.S. census shows that nationwide, over a 10-year period, the number of renters has grown at its fastest rate since 1965. With an increase of about 8.5 million renters in the last decade, competition has grown and pressure has increased on both renters and landlords. Tenants face fierce competition to find a suitable and reasonably priced home, while landlords try to get the right rental price for their property in an increasingly competitive rental market.

Landlords are running a business, and like every business, they want to maximize profits. A property’s monthly rental cost may seem reasonable, but the utilities and other hidden fees can add up to sizable extra costs for the tenant. Look out for these hidden costs and add-ons you before signing a tenancy agreement.


Tenants often overlook utility bills when they’re excited to move into a property. To understand the overall rental cost of a property, take the cost of all the utility bills into consideration. State laws differ when it comes to how tenants are billed for utilities, and what happens in the event of missed payments and utility shutoffs.

Utilities may be included in the rent and billed to the landlord. Other properties may require the tenant to have the utility bills in their name. In apartments and flats, master meters are often used by landlords to serve the entire apartment block or building, and tenants are billed individually. This is known as third-party billing and is popular with landlords because they can advertise a base rental cost but then charge for the utilities as an extra add-on cost.

Third-party billing regulations

Some cities see third-party billing as deceptive and have introduced legislation to oversee third-party billing. Seattle’s third-party billing ordinance covers all residential buildings that contain more than three units in an attempt to combat deceptive landlords from fraudulently overcharging tenants for utilities.

In 1977, the non-profit Tenants Union of Washington State was formed to offer help, information, and advice to tenants regarding tenancy issues, third-party billing, and other issues connected to utility costs. The advice the organization offers is not restricted to Washington State. It is advisable that all tenants, regardless of location, follow its advice in regards to utility bills:

  • Ask questions and have a clear understanding of utility services before signing a tenancy agreement
  • Set up utility accounts quickly
  • Pay utility bills on time and retain all payment documentation
  • Take precautions to protect yourself with the landlord
  • Try to resolve any utility disputes quickly

Other hidden fees and charges

Some landlords may charge additional fees other than utilities. These fees can be optional services or they can be required for all tenants, depending on the tenant’s specific agreement and situation. These fees can even be related to supply and demand, depending on the competitiveness of the rental market.

Separate fees could be charged for parking or if you have pets at your residence. Landlords may also charge an application fee that must be paid regardless whether a tenant is approved or not.

Southern Maryland condominiums and apartments that are subject to homeowner’s associations (HOAs) can charge for tenant-occupied units and separate move-in fees. Amenities that are not considered utilities, such as Internet access and cable TV, under most state ordinances may be billed to the tenant as an additional fee from the landlord or HOA.

These additional fees are on top of the security deposit and advanced payment of rent that is required by most landlords – usually the first and last months’ rent – that have to be paid before a tenant can move into the property.

Need advice?

There are non-profit advocacy organizations around the country that offer help and advice to tenants. Most states also provide information for landlords and tenants on their official websites. If you are still confused, or cannot find the information you require, you may need to consult with an expert who knows the state law and can offer advice and services to help resolve tenancy issues and problems quickly and at an affordable cost.

Fort Washington MD Homes for Sale and Real Estate Services in Southern Maryland. You now have a search engine to help you with your Southern Maryland home search! And I’m ready to provide you with a custom home valuation if you’re considering selling your home. Let’s connect to discuss how I can help you. Contact Kimberly Bean at 301-440-1309

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