Thinking about putting your home on the market? It can be a great decision. It’s a seller’s market in many areas. However, that doesn’t mean that you can expect a sale within days of listing your property. In fact, in some areas, the residential real estate market can be pretty competitive, and you’ll need every advantage you can find. One that you should certainly consider is investing in a home warranty. We’ll explore everything you need to know below.
Doing Your Due Diligence
Before you put your home on the market, it’s vital that you do a little research. While the overall real estate industry might be trending up, that doesn’t mean your specific area is primed for sales. Check into the health of your local real estate market to make sure that now is the time you should be listing. Forbes offers 10 ways to do just that.
What Is a Home Warranty?
Ok, so you’ve done you due diligence and now is the time to sell. So, what is a home warranty and why would it help you sell your home faster?
A home warranty is really just a service contract that covers important aspects of your home that insurance won’t protect. For instance, if your heating and air conditioning system goes out, you’re usually on your own to repair or replace it. The same applies to your stove, your oven, your refrigerator, and your dishwasher.
Those major appliances can be incredibly expensive to repair, much less to replace. Most families don’t have a spare $10,000 or $20,000 lying around. Those who’ve just purchased a home have even less. By bundling a home warranty in with your sale, you make your property stand out from others on the market because you’re also offering protection for the buyer’s investment, as well as peace of mind.
How Does a Home Warranty Work?
These agreements are actually pretty simple. It’s a great deal like insurance, although it’s not quite the same. When you purchase your warranty agreement, you’ll need to choose the appliances and systems that are covered. Most warranties automatically cover things like the following:
A built-in microwave
Your garbage disposal
Your washer and dryer
Your air conditioner
Your water heater
However, you can also upgrade to a higher-tier plan with additional coverage for things like the following:
Your electrical wiring
Your pool system
Your spa system
Your chest freezer
Your well pump
When one of the covered items is damaged or fails, you simply call the warranty company and file a claim. The company will send a service technician to the home to handle the situation.
The best thing for home sellers is that these warranties are transferable, so you could purchase a warranty and then hand it over to the new homeowner who would then enjoy a full year of coverage and be able to re-up their warranty protection at the end of the year.
The Home Warranty Company Matters
One thing to understand here is that the home warranty company you choose matters a lot. It’s important to compare your options so that you can make an informed decision. The right company can be an asset that accelerates your home’s sale, but the wrong company might be a turn-off for potential buyers.
Home Warranty of America, or HWA, is an increasingly popular option that provides several different plans to choose from, as well as optional standalone coverage for items not covered in other plans. They get high marks for trustworthiness and coverage, as well as for having easy-to-understand contracts.
When comparing home warranty providers, make sure you check out some of the more critical areas, such as:
•Number of complaints with the BBB
•Ease of communication and availability through social media
•Quality of contractor/technician work
•Availability within the US
•Delays in repairs/replacements
•Rate of claim denial
With a head-to-head comparison, you’ll be able to find an affordable warranty provider with a good reputation to increase the appeal of your home.
In the end, including a warranty with the sale of your home is a very good idea. It offers peace of mind for prospective buyers who might be strapped for cash after paying closing costs and other associated fees involved with buying a home. It also sets you apart from other sellers on the market, helping to make your property more attractive and ensuring that your home spends as little time as possible on the MLS.
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