When buying or selling a home, one of the biggest questions that pops up is whether to get or offer a home warranty. If you’ve been in the real estate market for a while or are new to the home buying or selling process, understanding how home warranties work can make a huge difference. Let’s break down what a home warranty is, why it might be worth it, and the pros and cons of offering one as a buyer or seller.
What is a Home Warranty?
A home warranty is a service contract that covers the repair or replacement of major home systems and appliances. Unlike homeowners insurance, which covers damages from events like fires or storms, a home warranty steps in when your home’s systems or appliances break down due to normal wear and tear.
Why Buyers Should Consider a Home Warranty
- Peace of Mind 🧘♂️: Moving into a new home can be stressful enough. The last thing you want is a broken furnace or dishwasher within the first few months. A home warranty can provide peace of mind, knowing that unexpected repairs are covered.
- Budget Protection 💰: With the average cost of repairing a major appliance ranging from $200 to $600 (or more!), a home warranty can save buyers from dipping into their emergency funds.
- Avoid Surprise Costs: Buying a home is already a big investment, and a home warranty can help avoid surprise expenses that might come up.
Why Sellers Should Offer a Home Warranty
- Increased Buyer Confidence: Offering a home warranty can make your property more appealing to buyers. It’s a sign that you stand behind your home’s quality, and it shows buyers that they’re protected from potential repairs after closing.
- Faster Sales: Homes with a warranty often sell faster than those without one, as they provide an added layer of security for buyers. It’s a great way to differentiate your home in a competitive market.
- Reduced Post-Sale Issues: If an appliance or system breaks down after closing, the buyer can turn to the home warranty company instead of contacting the seller, minimizing potential disputes or headaches.
Pros and Cons of a Home Warranty
Pros:
- Affordable Protection: It’s a relatively inexpensive way to protect against costly repairs.
- Convenient Repairs: No need to search for a repair person; the warranty company handles it.
- Attractive Selling Point: A home with a warranty stands out to buyers.
Cons:
- Limited Coverage: Not everything is covered; make sure to read the fine print.
- Service Call Fees: Most home warranty companies charge a fee every time a service provider visits.
- Potential Denials: Claims can sometimes be denied if the item is deemed improperly maintained.
Is a Home Warranty Worth It?
The answer depends on your situation. If you’re a buyer purchasing an older home with aging appliances, a home warranty can be a smart investment. For sellers, offering a home warranty can set your listing apart and help you sell faster. It’s all about weighing the benefits against the cost and deciding what works best for your needs.
Ending Thoughts
A home warranty can be a valuable tool whether you’re buying or selling. It offers protection, peace of mind, and can even speed up the sale process. If you’re thinking about whether to get or offer a home warranty, consider your specific circumstances and how much protection matters to you.
Ready to talk more about home warranties or need advice on buying or selling your home in Minnesota? Contact me today! 😊
– Jordan Eatherton, Apex Realty Team