Understanding Home Warranties: A Seller’s Perspective
When you're preparing to sell your home, there's one thing you might not have considered yet—a home warranty.
While home warranties are often thought of as a buyer's concern, they can actually be a valuable tool for sellers too. Offering a home warranty can give you an edge in the market and help your home sell faster.
But what exactly is a home warranty, and why should you care as a seller? Let’s break it down from a seller’s perspective.
What is a home warranty?
A home warranty is a service contract that typically covers the repair or replacement of any major home systems and appliances. This includes but not limited to; HVAC, plumbing, or electrical systems.
Now, unlike many homeowners insurance that covers the damage from accidents or even disasters, home warranties steps in when an appliance or a system break down because of a wear and tear (which is totally normal).
Why you should offer a home warranty as a seller?
There are three exact reasons why you should offer a home warranty as a home seller. First of the list is it attracts more buyer. If it isn't obvious, including a home warranty as part of your sale can make your home more attractive. It sweetens the deal deeply. After all, even if you are in buyer's shoes, you'll surely love the idea of not having to worry about unexpected repair costs in their first year of homeownership.
Second, it boosts the buyer's confident in your home. You see, if you have a home warranty, it reassures the buyer that they are making a sound investment. Most of buyers often feat the unknown—especially when it comes to major home systems like heating, air conditioning, and plumbing. Offering a warranty can calm those fears.
Lastly, there are fewer post-sale disputes. Even if the sale if complete and you sold your home quicker, buyers might discover problems with the home (though totally common, it shouldn't be a thing). So, instead of calling you to complain or demand compensation, which is the worth thing that can happen, home warranty will take care of it. This can save you a lot of headaches (and potential legal issues) after the sale is done.
To give you an idea of how much a home warranty can impact your home sale, check out these statistics:
| Statistic | Impact |
| 8 out of 10 buyers request a home warranty | Buyers see it as a key selling point. |
| Homes with warranties sell 11 days faster on average | Home warranties can speed up the selling process. |
| 90% of sellers report fewer complaints post-sale when offering a warranty | Reduced post-sale issues and headaches. |
| $350 - $600 cost of a basic home warranty | An affordable option for sellers. |
| 32% of buyers are more likely to place an offer on a home with a warranty | Increased buyer interest with less risk. |
What is the cost of a home warranty?
For sellers, the cost of a basic home warranty typically ranges between $350 and $600 for a year of coverage. That's a relatively small investment considering it could help your home sell faster and for a higher price.
Here's another good news: Many home warranty companies don’t require you to pay for the warranty upfront. Instead, the fee can be taken out of your closing costs, which means you don't have to come out of pocket before you sell.
When should you offer a home warranty as a seller?
Offering a home warranty makes sense in several scenarios:
- If your home is older and the systems or appliances might be nearing the end of their lifespan, a warranty can give buyers confidence that they won’t be stuck with big repair bills right away.
- If you're in a competitive market where buyers have a lot of options, a home warranty can set your listing apart from the crowd.
- If you want to avoid any potential conflicts with the buyer after the sale, a home warranty can take care of those concerns without you having to get involved.
What do we think?
We think offering a home warranty is a smart move, especially if you want to sell your home fast in Texas. It adds a layer of protection for both you and the buyer, and it can give your home an edge in a competitive market. It’s a relatively small investment that can lead to a quicker sale and fewer post-sale headaches.