Home Warranty, yes? Home Warranty, no?

Home Warranty, Yes? Home Warranty, No?

This posting is observational and anecdotal. Many of our landlords ask us about the viability of home warranties as a buttress against unexpected maintenance costs to their rental homes. On paper this seems like a great idea. In reality, not so much and here’s why.

Home warranty companies over-promise and under-deliver. When we put in a request for service and even if that request is an emergency like one we received yesterday, the home warranty companies don’t move fast enough. Here in Durham, NC last night the temperature was 27 f. The heat went out in one of our rental homes. The owner has a home warranty. We consider this type of no heat scenario to be an emergency. The home warranty company doesn’t think so and won’t send an HVAC technician to the property until sometime today.

Our preferred vendor could have gone to the home yesterday and more than likely would have solved the problem. So, what’s the cost and take-away?  The number one reason why tenants don’t renew their lease? Poor response to requests for service. Owners who rely on home warranties to mitigate cost to repair their rental home do so at the expense of tenant good will. Is that cost worth it?  I’m not sure it is.