NOI Hacking Secrets: How Utility Billing & RUBS Supercharge Multifamily Profits with Tiffany Mittal

So we saw just from that $36,000 of utility income, we saw a million-dollar increase of property valuation that when we went to go get the property refinanced, they said your value has increased by a million dollars just from this $36,000 of utility income. We're able to cash out refi $500,000 and use that money to buy another property. And that was like, Ding, ding. Like, this isn't about utility billing. This is about forced appreciation. That forced appreciation becomes a mechanism to grow your portfolio.

Welcome to the Real Estate Pros Show, where we interview real estate investing professionals from coast to coast, as well as the service providers that serve the real estate investing industry. Our goal is simple: share what's working now to help you improve and scale your business to the next level. And meet the pros that can help you get there. Real Estate Pros is powered by InvestorFuel, America's leader in helping real estate investors and professionals build the business you need to live the life you've always dreamed of. Let's start today's show. Property insurance for real estate investors doesn't have to be difficult, but it does need to be there to protect you when you need it. MyInvestorInsurance.com not only provides insurance at 15% to 30% cheaper than traditional agencies. It's built specifically for real estate investors like you. You can set up an account in about 2 minutes, get quotes on properties, turn on and turn off insurance for your fix and flip or rental properties in around 2 minutes without having to talk to anyone directly, all through our portal. There's no better way or faster way to make sure you've got the coverage you need to protect you, and no more lengthy policies either. Once you're set up, you're billed monthly and prorated by the day for however long your policy is active. It's powered by MSI, the 3rd largest independent MGA with 1.5 million customers and more than $1 billion in cumulative premiums written. Get set up today in about 2 minutes at myinvestorinsurance.com/fuel.

Hello everyone. Welcome to the Real Estate Pros Podcast. I am your host, Q Edmonds. You know what I'm gonna say? I'm excited, excited to be here today. I have another fantastic guest. Listen, she is an owner-operator. She is an investor. But I tell you, she has figured out a buy and hack that y'all are going to be excited about. I know you are. And I'm going to let her control how much she's going to tell you because I don't want to get— want her to give you all the secrets to her sauce, but I want her to give you enough to pique your interest because she is doing something that is much needed. That's really going to help out a lot of people and really is going to break up the monopoly in the business, if you ask me. And so I really am excited to introduce you all to Ms. Tiffany Mittal. How did I do, Ms. Mittal?

You did wonderfully. Thank you.

Absolutely. Absolutely. Um, I appreciate you being here. I'm excited. I want to dive right in. I don't want to waste any time. So I would love for you to just take us into your world, right? Tell us what your main focus is these days. If you want to give us a little origin story about how you got started, why you're doing what you're doing, we love origin stories. And if you want to tell them what part of the world you're in, I would love for them geographically to get a vision of where you are, who you serve as well. And so, Ms. Tiffany, you have the floor, ma'am.

Thank you so much. I would love to take everyone through a little bit of the origin story. So try to go through it somewhat quickly because I know we only have a little bit of time together. But I'm calling in from Florida where I live now. I'm originally from San Diego. I was born and raised in San Diego. And we recently moved, me and my family with our 4 kids out to Florida a couple years ago. So with that has become now our, what do you do with your multifamily portfolio in San Diego when you move to Florida? Like this was not an easy move. So we got third-party management. We went from owner operators to more like asset managers, and then we moved to Florida. And now we've started transitioning our portfolio. We actually have one property left in San Diego In the last year, we've purchased 5 new properties. Actually, the last 2 years we've purchased 5 new properties through 1031 exchange and have really started to grow our South Florida multifamily portfolio, mainly in Broward County is really where we see a huge opportunity. And we actually use our software company, which I'll go into, Utility Ranger, as part of our buying strategy, as part of our acquisition strategy.

Stop living on an island and join the number one mastermind in America for professional real estate investors. InvestorFuel is a community of hundreds of the nation's top investors working together to build stronger businesses and better lives. In addition to the amazing community of real estate investors acting as a board of advisors for one another, InvestorFuel members have access to 100% funding on purchase and repairs for our members only. A health insurance program and benefits and discounts that more than pays for the membership of most of our members, meaning it's actually costing you money to not be a member of InvestorFuel. If you're looking to scale your business and build a business that allows you to live the life of your dreams, please visit investorfuel.com today and book a call with our team.

It's really our secret sauce, uh, behind our acquisition strategy out here in Florida, and I'll dig into that in a little bit. So really in San Diego, we were multifamily owner operators. We saw a problem within our business and couldn't find anyone who would help us. So we had multifamily portfolio. Most of our expenses that continued to creep up and really eat into our profits were really from utilities.

Mm-hmm.

The utility rates in Southern California have continued to rise and are continuing to rise. Year over year, astronomically higher than our rent could increase. So I had heard of this thing called RUBS, and this is back in 2011. I'd heard of this thing called RUBS or ratio utility billing, which is basically a mechanism of transferring your water, sewer, trash bills from landlord paid to tenant paid using a mathematical formula, using tenants' occupancy and square feet. So more people in the unit, you pay more than Less people in a unit, larger units pay slightly more than smaller units. But you take your 3rd largest expense and you get reimbursed from your tenants each month. And so that's real kind of bottom line money though. That's money that directly hits your NOI, right?

Mm-hmm.

So we had about $36,000 of utility expenses, maybe a little bit more, maybe closer to $40,000. That first year we implemented RUBs on our properties, we started with one 36-unit property. That first year we got about $36,000 back from utility reimbursements. Now, I would say it was just as easy as going out and having some company that does RUBs do this for us, but it didn't really turn out that way because every company we called said, I'm sorry, you're too small unless you have 1,000 units in your portfolio. We won't service you. Because I really didn't understand at the time that these prop tech companies that are out there and really service companies for all multifamily are really designed for institutional players. All of these companies are going after the whales, the Greystars, the Riverstone Residentials, all of these, but nobody's going to help the small, you know, mom-and-pop investors like us. So nobody would take us on as a client. So I said, how do I solve this? I'm a problem solver by nature. So I backdoored the system. I got a job at one of these companies. I was not really liking, you know, working in the operations. My husband, he grew up in the business of multifamily. He has a big family office and he said, this is how it is. I'm like, this, I like multifamily, but operations is not my thing. So let me go work for one of these companies and see if I can add value to our portfolio this way. And I knew if I worked for them, they would take us on by default as a client. So it was kind of a way of getting our bills transferred to our residence by working for one of these companies. I grew these companies. I've worked for a couple different companies like this and grew many of them and scaled them and realized that little— I mean, I knew firsthand why they wouldn't take on small clients is because these are service providers. You have billers in chairs who are literally pushing bills out and mailing them to your tenants. It's a time-consuming service that they're not going to do this for a little bit, a little client like me, because it's the same amount of work whether you have 100 units or 1,000 units. So I, after working there for a number of years, I thought to myself, how do I take this service model and turn it into a software model? Because these service providers, they don't have my best interest in mind. They make 30% of their revenue off of late fees. And my tenants are getting feed to death. I'm giving them, let's say, a $5,000 utility bill and getting a reimbursement check of $1,500 and saying, well, where'd all my money go? And it got eaten up by fees and non-payers and all of these things that really weren't benefiting me as an owner.

If you're looking for consistent, high-quality leads, look no further than Investor Machine. Investor Machine isn't just another agency. It's the most sophisticated data-driven lead generation company on the planet for real estate investors and serves the role of being not just a lead generator for your business, but a marketing partner that is helping you achieve your goals along the way. Go to investormachine.com to learn more and schedule a call with our team today.

And, you know, the more companies I worked for, I'd say, well, how is this impacting the resident? And they'd say, well, the resident's not really our client. The owners are clients, and those are really clients of the owners. And it's like, if you can't keep the residents happy and don't understand why that's so important for owners, like, that's a huge problem. Because if your residents aren't happy, they're gonna complain, making the management unhappy. And if the management's unhappy, you're gonna lose a client. And so this is so important that you need to understand that the residents really come first in this equation. And so, Through all of this, I said, how do I take this service model and turn it into a software model, but make it so easy I can put it into the hands of owner operators to where it's not complex? You could just stick in your utility bill and have the utility bills get emailed or texted to my tenants. Why do I have to, you know, hard copy mail a bill to them? They probably don't even get mail anywhere. So, you know, again, my problem solver, my, by nature in 2020, I was, Working for a fintech company, which I hated. I realized really quickly when I moved from prop tech to fintech, which is property technology focused on landlords versus financial technology focused on like payments and things like that. I just didn't care as much if a payment went through 30 seconds faster. I was offering real value to owners like me because when I did it for my own property, I mean, and this is really the secret behind utility billing. When I did it for my own property, we got $36,000 back from utility reimbursement payments from our tenants. So that's real money hitting your NOI. But any investor out there would know that how you value multifamily properties is your NOI, your net operating income divided by your cap rate. So we saw just from that $36,000 of utility income, We saw a million-dollar increase of property valuation that when we went to go get the property refinanced, they said your value has increased by a million dollars just from this $36,000 of utility income. We were able to cash out refi $500,000 and use that money to buy another property. And that was like, ding, ding. Like, this isn't about utility billing, this is about forced appreciation. That forced appreciation becomes a mechanism to grow your portfolio. So, you know, you talk about the BRRRR strategy, like this is all about growing your portfolio using the same money. This is really the new version of that. This is like NOI hacking, right? Because every dollar that you get back or bill back to your tenants is like a $20 increase of your property value. So a $36,000 increase Like that's a huge increase of property value. And so we did that across our portfolio in 2020. I was working for the fintech company. I said, I can't work another day. You know, everybody had these epiphanies during COVID because, you know, I call it the midlife awakening triggered by a crisis. You know, I can't do this for anybody else anymore. I have to do my own thing. So, you know, my husband gave me my initial capital. And I quit my day job. I invested into, which is now Utility Ranger, and we started Utility Ranger to help the little guys like us, you know, be able to have the growth within their own portfolio, grow their own portfolios, you know, NOI hack. And so that's how we got started. It's definitely taken us on a journey from, You know, really just having a problem to now having a company that we use really as a key part of our buying acquisition strategy.

Ms. Tiffany, thank you. I mean, that was a very succinct way to tell us from where you started to where you are now. You sprinkled in all types of nuggets that I know piqued everyone's interest. And so thank you. I think that was, that was great. I love stories, right? So that was just great storytelling to me. I know you was just Answering the question, but to me, I've seen it as just great storytelling, good theater, if you ask me. And so I thank you so much for sharing. Now, you obviously, Utility Ranger, up and running. You've hacked the system. It's there for people. You're about to help people, about to roll it out.

If you're a new or newer real estate investor looking to launch or grow your real estate investing business, Please check out Investor Fuel Club. It's a coaching community, but unlike anything you've ever seen before, and you can actually partner with members of our mastermind from coast to coast on deals right in your market. There's no better opportunity to build a consistent business than to literally partner with pros to help you avoid costly mistakes, avoid the need for capital to do deals, and help you eliminate your fears and As you're starting your business. Learn more about InvestorFuel Club at investorfuel.com/club.

Now I want you to take me a little bit on the journey to get into success. And when I say that, has there been adversities as you started building this thing out? Did you hit any bumps in the road? And I asked that question because of course, being an entrepreneur, everybody's at different places in their journey, right? And some people may be at adversity and like, how do I get past this? And so I just wanna know, have you hit some adversity and got over that adversity on your way to building Utility Ranger?

Well, I would say absolutely. I'm a, a multifamily person at heart now building a software company. And, you know, there's gotta be some struggle along the way. So, uh, you know, absolutely. I would say we started this in 2020. By 2021, really, I had half-built software and was out of money. And so, I felt, you know, my software company said it was going to be another $500,000, another year to finish the software. I felt at that time I couldn't really go back to my husband and say, oh, can I have half a million dollars to finish my software?

Hmm.

But I knew I needed a partner and I needed a partner who understood this audience really well. And so I actually pitched my company to Grant Cardone and the 10X kind of ecosystem, and they initially turned me down. I kind of made it to the second phase of an interview and then bombed on my second interview. But then he kind of recalibrated and started this thing called 10X Incubator with another guy, Jared Yellen, about 6 months later. So I pulled myself together, I pitched my company to them again 6 months later, kind of towards the end of 2021. They loved it and they invested on the spot. And that was a great partnership because his whole audience was my target market, was people who were getting into multifamily investing. So that was a great partnership that really kind of kicked off our journey because we did a big tech transfer over to their teams. We raised another round of capital. We used that to finish the software. We went to market a year later. So this is 2022. We finished the software at the beginning of 2023. We went to market in beta in April. We went to market, full market. And by September, we had an acquisition offer by one of the largest utility billing companies in the country. And I was very flattered. I mean, I thought, you know, my husband's like, let's go for it. I'm like, wait a minute, I'm just getting started. I really want to kind of grow this a little bit more before, you know, and the funny thing was I told him, I'm not ready to get married just yet, but let's date for a little while. And so, yeah, yeah, yeah. So I forged a strategic partnership with them and they knew, and I knew the problems of they don't want to deal with the small clients because their main focus was institutional investors. And what are you going to do with these small clients who are calling you? So now, you know, they hand off all their small clients to us and that's been giving us a huge amount of growth. Their partnership has gone really well over the last couple years and we are continuing to grow. We're focused on building out integrations with major property management platforms, adding new features into our software all the time. Our clients love us. We have almost no attrition on our software because once you start billing your tenants for utilities, I mean, this is money back in your pocket. This is the 3rd largest expense on your books. You get that money back in your pocket. I mean, you're not going to stop putting that money back in your pocket because now this becomes your ability to grow your portfolio.

Yeah.

So as we moved out to Florida in 2022, you know, we said, okay, we have to sell our properties. Let's 1031 them out to Florida. This has become part of our biggest buying acquisition strategy because now we say we're going to buy a property that specifically is not billing for utilities. Instantly turn 'em around with 30-day notices or upon lease renewals, turn 'em around, start billing them for utilities and drive up the value of the property, refi the property, pull the cash out, use that money again, buy another property and do it again. And that's why I said it's very similar to the BRRRR strategy, right? You're going to buy, renovate, rent, refinance, repeat. But what if you don't have money to renovate? Right? Like that's, you can't just buy a property. You're, most of the time people are putting all your money to buy the first property or buy the second property. You don't necessarily always have money to renovate the units to increase the rent. So you can kind of increase the rent without renovating the units, right? So we'll buy a property, focus really on transitioning the utilities. What else? Now this is where the NOI hacking comes in, right?

Mm-hmm.

So What else can we bill for? Can we put managed wifi on the property? So instead of them spending $70 on wifi per unit, I can get it for $15 to $20 a unit and bill them for $50. So they're getting a discount for the wifi. I'm making revenue on the wifi. You know, can I do maybe VIP parking spots and people who want to pay for those get the VIP parking spots? Can I add electric car charging? Can I charge for pest control? Like, what am I billing or what am I paying for that's benefiting the residents, right?

Mm-hmm.

So I look at it, pest control, like all these things that you're paying for, you know, people are charging amenity fees on these big Class A properties. Why can't I charge amenity fees?

Mm-hmm.

Right? So the amenities fees may be for my pool, it may be for my security cameras, my gated access, my secured access. Like all of these things are amenities that I'm providing off to my residents. So even if I'm charging $15 to $20 for an amenity fee, that might sound crazy initially, but the big guys are already doing it, right? It's only a matter of time before that trickles down and they're doing it because they can do it. Again, why can't I do it? Right? Like I need the money, I need to grow my property value. And so this is really what we're doing. And so we've done it already. We just refinanced one of our first properties we bought, which was 30 units in Pompano Beach. You know, that had already increased over $1 million in value. We were able to pull out $750,000 and use that money towards another property acquisition. So this has really become our NOI hacking strategy on our property acquisitions. And moving to Florida became the perfect kind of—

Oh yeah.

Case study to do this on because we were using this as part of our strategy, implementing it, and now seeing the fruits of our labor from the last couple properties or the first few properties we bought, we've been able to refinance. So we've just bought some recently that we are rolling this out on right now. So it's definitely something that if you're trying to grow your portfolio and you want to raise rents, but you don't have money to renovate the units, really look at your expenses and say, how much of this can my tenants be paying for? You know, everyone's doing it at this point. If you're not doing it, you're really behind the ball. And people say, oh, I'm just going to include it in my rent and I'm already at market rent. But if you're not billing for utilities and you think you're at market rent, And let's say your rent is $1,500 and your neighbor's rent is $1,500 and they are charging for utilities. Really, if you're not charging for utilities, your net rent is probably closer to $1,400.

Hmm.

And their net rent with charging utilities is probably closer to $1,600. So now you're $200 per unit different, less than your, your, your neighbor, your competitor. How do you compete? You can't. So market rent, you have to do apples to apples. And, you know, people aren't looking like, you know, what amenities do you include? Like they used to. Now it's so commoditized, it's what's the rent? They won't even—

Right.

If you say, I'm going to include rent, I'm going to include utilities on my rent, and to really be market rent, you'd have to be marketing your apartment at $1,600, but you're not going to get any traffic. If you're marketing at $1,600 and the market rent is $1,500, even if you're including utilities, no one's going to show up. So you have to like, I call it like you think of how other industries, right, are impacted when they have commoditization of pricing. Like I look at the airline industry, what do they do? They unbundled their baggage. What do resorts do? They unbundled their resort fees. We're unbundling rent, right?

Mm-hmm.

You're renting the airspace and everything else is extra because all these other things are going to be volatile. If I want my rent to be somewhat stable and not having to increase it so much to cover these costs, I can keep my rent more stable because these other things are being charged on the side.

I mean, perfect way to— I mean, you said it so perfectly. You broke it down, but then that end statement just really synthesize why you're doing what you're doing. I can stabilize the rent instead of having to keep raising it and raising it. We can stabilize it now so you know what you're looking forward to. And we can— I just love it. I mean, I love what your business, the model is doing. I absolutely love it. So what is the next real goal for Utility Ranger? What's the next thing? What's the next real goal?

Well, we're just focused on growth right now. We're really in a big growth We're working on integrations with some of the major property management softwares. We are adding a bunch of new features into our platform. We're adding AI features we've been working on for the last few months. So we have a bunch of new AI features that are going to come out towards the beginning of 2026.

Mm-hmm.

That's going to really kind of change the game because we're somewhat of a new category in utility billing. It's always been a service model. And so we're a SaaS model. You know, our owners technically become their own utility billing providers, which can sound scary. I, but I always relate it to like, you know, we're about, utility billing is about as sexy as doing your own taxes.

Right.

You know, nobody wants to do your own taxes, but then TurboTax came along and they made it really easy because when you really break it down, like you were just giving your tax person a bunch of numbers that they were inputting into some complex software. TurboTax came along. Now, maybe not for the real estate investor, but in my example, TurboTax came along and the same numbers you were giving your real estate investors, you could just enter real easily into the software and it did it for you. So that was really our approach. Like just put in your utility bills, press calculate, look at your bills, and then send 'em off. They go off via email, they go off via text message. Tenants can literally click pay online. The invoice literally becomes a payment. mechanism right within the invoice so the tenants don't have another portal to log into. We've made it so simple to just pay online directly. And then, you know, we don't actually collect for people. It goes, they add their bank, they connect their bank, it goes right into their bank account. So you don't have all these excessive fees. Like we charge $3 per unit per month. And that's a software license, right? And the owner, because they're doing the you know, billing each month, they can charge $6 a unit per month, just like the billing companies can, and make that extra $3 per unit per month as additional revenue, as a billing fee revenue, because they become their own utility billing provider. And we provide them the tools to be able to answer resident questions as if they're a professional utility billing provider. And a lot of that is coming from our AI generation that we've been training for years now. We've made it so simple. Like a lot of our clients, they've been doing utility billing in the service provider world for a number of years, and it literally fills my cup when I talk to them and they say, this is so easy. Like, why was I ever using a third-party company? Why? It's just a waste of time to have to call them and wait for an email back. It's like having this other, like, arm in your business that you have to like wait for them to respond. You've literally, we've made it so easy that having a third-party company is irrelevant. And you see that now people are kind of vertically integrating their businesses, um, making, you know, those third-party companies irrelevant allows you to really have control over the system.

You have given some valuable nuggets. I mean, I know our viewers Going to see this, going to absolutely love it. And so, yes, I want to talk about how can people get in contact with you? Like, if somebody wanted to reach out to you, collaborate with you, integrate, you know, if they just want to get in contact with you, how can they get in contact with you now? Because I'm pretty sure people are going to be wanting to talk to you.

I would say the easiest way is just going to utilityranger.com. There's a contact form on there. You can reach out to me. Also LinkedIn, Instagram, Facebook, all of those. You can either find me at— probably the easiest is utilityranger.com, just to keep it simple.

Gotcha. Well, listen, I thank you so much. Thank you for your time. Thank you for your story. Thank you for your perspective. Thank you for your patience. I really appreciate it. This has been good. I know our viewers are really, really, really going to love this episode. And so Thank you so much for coming by today. I really appreciate it.

Yeah, absolutely. Thank you for having me.

Absolutely. Well, listen, y'all got the value from Ms. Tiffany. Go ahead, reach out to her, but definitely make sure you are subscribed. That way you can continue to get this valuable content from these amazing people, just like Ms. Tiffany, as they keep coming up. And the alert will let you know when you can come in and just get the content. So again, I thank you, Ms. Tiffany. Everyone else, we will see you on the next time.

Thanks for joining us for today's Real Estate Pros Show. You can learn more about the amazing benefits of the InvestorFuel Mastermind community, including surrounding yourself with hundreds of other rock stars, 100% financing for your deals, and members-only discounts from vendors you're likely already using that, as a member of InvestorFuel, will save you more than the cost of your membership. Visit investorfuel.com to learn more. If you're interested in joining us as a guest of this show, please visit investorfuel.com/pros to apply. You can also check the show notes for access to free resources, how to get access to world-class lead generation, and much more. Don't forget to subscribe so you never miss another episode. Have a great day. We'll see you on the next show.