The Hidden Cost Drain in Your Park
In a master-metered 100-lot mobile home park, annual water and sewer costs commonly run $72,000 to $120,000 per year. When the park owner pays that bill and bundles it into lot rent, residents have zero incentive to conserve water. Leaky toilets, running hoses, and overwatering are invisible costs that erode your NOI every month.
Submetering changes that equation. By installing individual meters on each lot and billing residents for their actual usage, operators recover 85% to 95% of the master meter bill and reduce overall consumption by 15% to 30% as residents become conscious of their usage.
The Financial Case
Consider a 100-lot park paying $8,000 per month ($96,000 annually) for water and sewer. Under a master meter with costs bundled into rent, the owner absorbs the full amount. After installing submeters and billing back to residents at a 90% recovery rate, the owner recovers $86,400 annually. Factor in a 20% reduction in consumption from behavioral changes, and the master meter bill drops to roughly $76,800, meaning the operator recovers more than 100% of the reduced bill.
At a 6% cap rate, adding $86,400 in annual revenue translates to $1.44 million in property value. The cost to install submeters typically runs $300 to $600 per lot, meaning a 100-lot park spends $30,000 to $60,000 for a project that pays for itself in well under one year.
RUBS Is Under Regulatory Pressure
Some operators still use Ratio Utility Billing Systems (RUBS), which allocate utility costs across residents based on lot size, occupancy, or a flat formula rather than actual usage. RUBS has been a simpler alternative to submetering, but the regulatory environment is shifting fast.
Multiple states have introduced legislation targeting RUBS in manufactured housing communities. The argument is that RUBS charges residents for usage they did not incur, effectively penalizing efficient users to subsidize wasteful ones. For a 100-site park billing $60 per month per site through RUBS, losing that revenue stream means $72,000 per year in lost income, or $1.2 million in lost asset value at a 6% cap rate.
Submetering eliminates this regulatory risk entirely because you are billing for actual, metered usage.
Rising Utility Rates Make This Urgent
Combined water and sewer bills for U.S. households increased roughly 24% over the past five years, with a 4.6% jump in 2024 alone according to Bluefield Research. A recovery rate that was acceptable three years ago may represent tens of thousands of dollars in annual loss at 2026 rate levels.
Every year you delay submetering, the gap between what you pay and what you recover widens.
Implementation Playbook
The process is straightforward but requires planning. Start by surveying your existing water infrastructure to determine whether your distribution system supports individual metering. Many parks built before 1990 may need line upgrades. Get quotes from at least two submetering companies that specialize in manufactured housing communities.
Budget 60 to 90 days for permitting, installation, and resident notification. Most states require written notice to residents before implementing utility billing changes. Review your state's regulations on utility resale, as some jurisdictions cap the markup you can charge above the utility's rate.
Choose a third-party billing company to handle meter reads, invoicing, and collections. This removes the administrative burden from your property manager and creates a professional, documented process that withstands regulatory scrutiny.
What This Means for Acquisitions
If you are evaluating a mobile home park acquisition, check whether the property is master-metered or submetered. A master-metered park with $100,000 in annual water and sewer costs represents a clear value-add opportunity. Underwrite the submetering conversion into your business plan and factor the NOI improvement into your exit valuation. Review the full MHP due diligence checklist before you close.
Requity Group targets manufactured housing communities with exactly this type of operational upside. If you are an investor interested in the MHC asset class, learn about the fund or reach out to the acquisitions team.