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riveree - I really think you ought to at least consider offering the home warranty. For many buyers it really does make a difference. And when you look at the whole picture - $300 on a $300,000 home - that's only 1/10th of 1% of the sale price. That's a small price to pay, even if it attracts only ONE buyer. Remember - it only takes ONE. And you don't pay for the home warranty upfront. It simply comes out of your funds at closing. Plus you're covered during the listing period so you might actually be able to use it yourself.
It also saves headaches for everyone, especially for the sellers and you, after the sale is complete. If something goes wrong, instead of the buyers trying to come back for the $$$ to fix the problem on their newly purchased home, they have recourse with the warranty company. That's the biggest benefit to the seller and listing agent, as I see it.
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Quote:
Originally Posted by Gretchen B
Normally the home warranty purchases are all handled through the escrow company (around here they are, anyway). The "extended" coverage costs about $400 through most of the HW companies. I'm an agent, and I purchase the home warranty as a gift for my sellers. I don't get any kind of a discount. It costs me what it would cost the seller. I like home warranties as a marketing tool. Anything that I can do to help my seller get his home sold more quickly also means that I will get my commission sooner, too. (Remember I don't get paid unless the place sells.) The Home Warranty will cover the seller during the listing period and it covers the buyer for the 1st year in the house. I do this because it helps an older home compete against a new home; it gives peace of mind to the buyer that they won't have to incur a big repair cost during the first year (and they can renew the policy thereafter); and some policies will even cover the seller for liability issues.
Maybe where part of the confusion is coming from: The seller's coverage during the list period is usually about $75 (some companies will do it for free) IF a home warranty is purchased for the buyer (that usually runs about $400-$450).
All that Gretchen B has said here is correct. In my area most of the agents present to the seller at the time of listing, information concerning the Home Warranty. Most of the time the seller sees the advantages and takes it. Those that do no, usually will request it after awhile.
Some of our agents buy it for the sellers for the reason previously mentioned, the seller is covered during the listing period and then the buyer is covered for 12 months. The seller or the agent can upgrade the HW if they so choose. Many options, such as swimming pool etc.
If I were to sell my older home, I would most definitely purchase the HW. Nothing to pay until time of closing is an added benefit.
One of our recent closings for an older home is a prime example of the benefits: Closed on a Friday afternoon and over the weekend the AC went out. Seller had a HW and by Monday afternoon the AC was repaired. Thank heavens it was something relatively minor.
There's quite a bit that's covered, especially with the "Premium" plans. Most appliances, water heaters, furnaces, etc, etc as well as lots of other stuff, big and small. There's usually a service call fee of about $40 - $75 depending on the HW provider; after that then the cost of the repair is covered. The policies vary, so you have to really read through them. There's also a fair amount of things excluded, so be sure to note those things, too.
just what is covered on a home warranty?? everything?? or is it major problems say, over 1,000??
Here's a page from American Home Shield. They're one of the warranty companies. Click here (broken link) for the page that gives an introduction to coverage. It's for used houses and doesn't show apotional add-on coverages, but it should give you an idea.
riveree - I really think you ought to at least consider offering the home warranty. For many buyers it really does make a difference. And when you look at the whole picture - $300 on a $300,000 home - that's only 1/10th of 1% of the sale price. That's a small price to pay, even if it attracts only ONE buyer. Remember - it only takes ONE. And you don't pay for the home warranty upfront. It simply comes out of your funds at closing. Plus you're covered during the listing period so you might actually be able to use it yourself.
Oh, I'll definitely consider it, but I want the realtor to pay for it from their commission. This is a modest home in a modest neighborhood (not worth$300k -closer to half of that).
We actually had a warranty on the home when we first bought it ourselves, it came with the house. Used it once. I actually can't stand them - you're placing a middleman between yourself and the electrician/plumber/etc. - not my style at all. So I let it expire and that was that.
I've redone most of the systems in the house (replumbed, new electric, AC has new motor, etc.), so I can't imagine what would come up during the sale of the house (small house....there's not much to it), but I know it can give peace of mind to a potential buyer, so it's worth that.
So, I'll have to see how it goes. A realtor that pays for the whole warranty out of their own commission, like you do Gretchen, will gain some points with me when I'm considering them .
I haven't even put it on the market yet and I'm already dreading the whole experience......ugh .
Sounds like you've got a good perspective on the whole HW thing, riveree. Many folks, like you, prefer to eliminate the middle man. But some really value those home warranties, so for the price it seems worth it to me to market to those folks, too. As far as the realtor paying for it, I'm really surprised more agents don't do it. It doesn't cost anything until the deal closes, and it seems like such a small price for one of those "feel good", peace-of-mind, potential referral, types of things. . . . Now maybe if I had to pay for it upfront, I'd feel differently about it. . . .
If something happens during the escrow period,some warranty company would help you fix the problem in the house
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