Should Sellers Offer Home Warranties?

When making a big purchase, like a car or an appliance, warranties can offer valuable protection – providing peace of mind that your investment is safeguarded. The principle applies to real estate!

Many buyers recognize the security that a home warranty provides, but did you know that sellers can benefit too? Offering a home warranty when selling your home, or already having one in place that transfers to the new owners, could make your home more attractive, reduce unexpected repair costs, and help you close the sale with confidence.

What Is a Home Warranty?

A home warranty is a service contract, typically lasting 12 months, that covers repairs or replacements of key home systems and appliances. Policies generally range from $450 to $1,000 per year, depending on coverage levels, with some providers offering monthly payment plans for flexibility.

If an issue arises, whether it’s a broken furnace or a malfunctioning refrigerator, the policyholder contacts the warranty provider, who dispatches a technician to address the problem. The homeowner is only responsible for the deductible, typically between $50 and $100, regardless of the final repair cost.

What Does a Home Warranty Cover?

Coverage varies by provider, but most warranties include essential home components such as:

• Built-in appliances like dishwashers and ovens
• Heating and air conditioning systems
• Electrical and plumbing systems
• Smoke detectors and doorbells
• Water heaters and garbage disposals

Enhanced plans may extend coverage to additional features such as pool equipment, well pumps, or roof leaks. Unlike homeowner’s insurance, which protects against disasters like fire or storm damage, a home warranty focuses on wear and tear from everyday use.

How a Home Warranty Helps Sell Your Home

Buyers want confidence in their purchase, and a home warranty provides exactly that. When a seller offers a warranty, it signals that the home has been well-maintained and provides a safeguard against unexpected repairs.

Benefits for buyers include:

• Peace of mind, knowing they won’t face major repair costs immediately
• Added value, making the home stand out in a competitive market
• Smoother negotiations, reducing objections that may arise during inspections

Most warranties transfer to the buyer at closing, ensuring continued coverage for their first year of homeownership. If the home sells before the warranty period ends, the seller may even receive a refund for unused coverage.

Why Sellers Benefit Directly

Selling a home takes time, and unexpected issues can arise—sometimes after inspections or even during negotiations. A home warranty protects sellers from costly last-minute surprises, such as:

• Replacing a broken HVAC system, which can cost thousands
• Repairing electrical or plumbing issues that could delay closing
• Handling inspection-related fixes without disrupting the sales timeline

Rather than scrambling for emergency repairs or lowering the asking price to compensate for potential issues, a home warranty streamlines the selling process, allowing sellers to close deals with fewer complications.

Is a Home Warranty Worth It?

For sellers seeking a smoother transaction, a home warranty can be a valuable investment. It reassures buyers, protects key home systems, and minimizes unexpected expenses during the sales process.

While no home sale is entirely risk-free, having this extra layer of protection can make all the difference—helping a home sell faster and with greater confidence.