Should I include a Home Warranty for the Buyer in our Condo Sale

11 Replies

Hello BP nation!

We are about to go into our first "deal" as REI. Excitement all over! I put the word deal into quotations simply because we are speaking of our condo in Atlanta that we over payed for back in 2009 simply because we wanted to live in the City. I must say, it was the best decision my wife and I made thus far in our lives (not the condo, but living in the city part). It sits in Old Forth Ward part of the city, near the Boulevard & Ralph McGill intersection. We have decided to sell it this year since we can raise about 20K from it to invest into our next deal (this time we will make money when we buy haha).

We were discussing potential amenities we could provide for the buyer and Home Warranty was one of the concrete options that came to mind. However, we are not sure how big of a benefit this would be specifically for something like a condominium.

Has anyone had previous experience with a Home Warranty for a condo and if so, does it make financial sense? What all is typically covered by the Warranty when it comes to condos? Any feedback is highly welcome as always! Also, any other amenities I can offer to the buyer to sweeten the deal?

Cheers,

Damir   

Most home warranties are not worth the paper (or internet screen!) they're written on, in my experience. If I were a buyer I'd prefer to have the financial considerations and would go and find my own warranty if I wanted such an animal. 

As for amenities, there's lots of things you can do when you are selling, but it depends on what you're looking for. If you want absolute, top of the market dollar, and you're in a seller's market, you might not have to do much, or if you are in a buyer's market you might have to do a lot of upgrades. 

I don't care for them but I would offer it to the buyer if they want one. They cost about $400 so if it helps make the deal work, do it. But I wouldn't offer it upfront . When you list in mls you have 3 options, yes, no , negotiable. I usually cross it as a negotiable item. Old Fourth Ward. Love it!! Good for you

A lot of first time home buyers want them, they're generally fairly worthless.   I wouldn't advertise it but I've had buyers request them and for a few hundred bucks I'll usually give it to them. 

Same story as most above. My wife and I even got one with our most recent personal home purchase. we use it once when our AC kept tripping out on low pressure (maybe a $150 call) but other than that nothing. It does give you a warm and fuzzy as a home buyer though, especially if the home or appliances are older. We most likely wont renew (even though my wife wants too).

Home warranties .....it's like insurance, but not subject to the same laws and regulations. I often wonder how much money they must spend lobbying to avoid falling under the insurance umbrella.

So the companies vary wildly...I actually have one I like a lot right now on all my rentals...Not sure I can say their name in this forum, but it rhymes with 'voice' ( i don't work for them or get paid by them in anyway). 

But your question pertains to selling. No one's going to make you an offer because you have one. It won't sell your property faster or at a higher price. If they want one, the buyer will simply ask for it .

Instead, save your money and put a $1000 buyer agent bonus for a "full price offer and 30 day close". I think you'll find this very effective.

Same with us @Kevin Harrison . We did receive a replacement for the sink dispenser and few A/C fixes here and there. Got it for free from the seller and we saved few hundred bucks over 1/yr period. 

@Annette Coker thanks for chiming in, we enjoyed every moment of living there (except street parking and towing experience haha). 

@Patrick L. makes sense, seems like it's well worth paying for if the buyer requests it. Makes them feel a bit safer as Kevin mentioned. 

Thanks all!

As a realtor I recommend to my clients to not offer a home warranty up front in a sale. If a buyer has a home inspection and wants certain items replaced (such as heater/ hot water tank) than as a the homeowner you can offer a home warranty which will save you money out of pocket versus replacing those appliances. Each home warranty company is different in what they cover exactly, but the main core service is for heater/ac/water heater and stove. There's add on packages as well.

hope this helps!

Buyers love home warranties, especially first time buyers. I would wait and see how the inspection goes- offer it up to the buyer if they start getting crazy with repair requests. 

Keep this in your back pocket but don't offer it up unless it becomes a sticking point.