It appears Home Warranties fell out of fashion over the past few years. Why? Because of our recent super-crazy Seller’s market due to historically low interest rates and low inventory, Buyers just weren’t asking for them anymore. But now that the market is beginning to shift, and Sellers are having to make some concessions like offering to pay for a home warranty plan for the buyer.
What exactly is a Home Warranty-also referred to as a residential service contract? They are policies or contracts stipulating that certain home systems (i.e. HVAC, electrical & plumbing) or appliances (i.e. dishwashers, refrigerators, ovens, etc.) are either repaired or replaced if they experience unexpected mechanical issues due to normal wear and tear. They DO NOT cover pre-existing conditions that are known.
How much do they cost? Most home warranties from top-rated companies will run about 700.00 per year depending on how much coverage you get. There are usually packages that cover just appliances OR systems only, and some “deluxe” policies that cover both. Some even offer unique “add-ons” that cover pools and spas, well or sump pumps and various electronic extended warranties.
Who benefits from a Home Warranty?
- First time homebuyers can benefit from a home warranty, as they typically don’t have any experience with home systems and appliances, and need a quick resource to contact when there is a break down.
- Low-income homebuyers can benefit as they have usually spent every last penny on the purchase of their new home, and don’t have the funds to fix something if it needs repair or replacement. An A/C unit can easily cost 5-10K to repair or replace!
- Existing homeowners can benefit by simply having peace of mind knowing that they are covered if something should unexpectedly break. People buy extended warranties for major items such as refrigerators or washers and dryers that can cost hundreds of dollars per appliance…so why not invest in a home warranty that has broader coverage?
- Landlords and Property Managers can also benefit as replacing or repairing appliances or systems unexpectedly during a tenancy can really add up and affect their bottom line.
What are some of the best Home Warranty companies in Texas? Here (in no particular order) are some that consistently get high ratings from the BBB, Google, Consumer advocate groups and the general public:
- Liberty Home Guard
- Select Home Warranty
- American Home Shield
- First American Home Warranty
- AFC-America’s Frist Choice Home Club
Whether you are looking to purchase your first home, or as an existing homeowner you simply want peace of mind, a Home Warranty is definitely worth looking into. Ask your real estate professional for more information and recommendations. Give us a call today!
