All Forum Posts by: Dong Yan

Great suggestion!  Thank you!
Originally posted by @Collin Garbarino:

My realtor told me that he gets a commission from the home warranty company every time someone buys one. I think that's the real reason that your realtor wants you to buy one. Ask him point blank if he gets a kickback.

I suggest having enough cash on hand (or a line of credit) to pay for unexpected repairs.

Originally posted by @Andrew Acuna:

Dong Yan here's how I look at it. These home warranties have high deductibles and are notorious for not covering problems. I don't have them and probably won't ever because most issues can be fixed with cheap labor and quicker when I don't have to use specific contractors.

Thank you for spending time to explain it to me. yes, after whatever you said below, I won't consider to buy a home warranty program now.

Just wonder why all real estate agent highly recommend it to me every time when I make a purchase.

Stella
Originally posted by @Kim Meredith Hampton:

@Dong Yan :

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.

Originally posted by @Lawrence Henkel III:

I would not buy the home warranty. They tend to be difficult to get items repaired in a timely manner. I have never had one myself but have seen friends & family spend weeks trying to get something fixed. My parents dryer kept breaking down and each time it would take weeks for it to be repaired. I would not want to rely on that for my tenants.

Originally posted by @Robert Motch:

I agree with @Joe Villeneuve.

Real estate investing requires a certain set of service providers (RE agent, PM, lawyer, accountant, bookkeeper, contractor, sub contractors, handyman, etc). There are good and bad options for all service providers and All service providers require oversight and management.

For the most part with each of these services, you have the choice of whether or not to outsource the job or do it yourself. Depending on your strengths and experience, you may choose to do some of these services yourself but like most things in life, you are trading your time for cost of having someone else do it for you.

I think it really depends on your strengths, how you want to spend your time and much you want to scale your business. 

More scale=More outsourcing.