Investor · Keller, TX · Member since 2015 · 81 posts · 22 votes
Looking at a brochure from a home warranty company it promises great things, however I am sceptical. I see they offer annual system checks and pest services as part of the package, but there is enough small print.
As a landlord do you use home warranties?
If so does it pay off over time?
Any suggestions thoughts experience for the “new starter and smaller landlord”
Flipper · Pittsburgh, PA · Member since 2017 · 218 posts · 345 votes
9y
Not worth it at all. Home warranties have their place in real estate investing, don't get me wrong! We include them when offering renovated properties for sale. They give first-time homebuyers peace of mind and a sense of security that we stand by our renovations.
Real Estate Broker · St Petersburg · Member since 2014 · 2k+ posts · 2k+ votes
9y
@Gary Baker here is a blog I wrote on home warranties, my two cents:
First, as a Property Manager for over 20 years I have found that Home Warranties to be an absolute nightmare when it comes to tenants, owners and warranty companies. I find that most of the time they magically don't cover the item that you are calling about, and you end up paying a service call fee, calling another vendor and then paying for and repairing it anyway. They also take forever to get someone out to take care of anything. I think that most of the time they make people frustrated and you end up losing money in the end. Typically the vendors they send out undercut each other to get the work, but then end up making no $, so your job falls to the bottom of the list! Waiting for them to replace or warranty is a real issue with tenants in the property. The tenant, the property manager or owner must pay for the service fee immediately, and then we play the hurry up and wait game! If you do purchase, it's important to make sure that you know your policy inside and out, what does it and does not include.
Thank you. I was leaning towards 'not', now I have fallen over. This home warranty sounded great having pest and AC services, but not if I have to jump through hoops to get anything done.
I don't believe in secondary car warranties either. If you so much as have a single item out of place then the whole thing is null and void. However if it is given to me for free on a purchase of a secondhand car, then why not.