The Top Advantages of Home Administration Service Warranty for Real Estate Investors thumbnail

The Top Advantages of Home Administration Service Warranty for Real Estate Investors

Published Feb 24, 23
8 min read

What is a warranty for your home?

A home warranty is a service agreement that covers the cost of repairing or replacing your home's systems and appliances when they fail because of normal wear and tear. Home warranties are not the same as home insurance which covers the structure of your home from natural disasters or theft however they do protect your home's systems and appliances. They are available for all kinds of homes and can be used to minimize the cost of replacements and repairs which makes them ideal for both new and existing landlords. The service fee is the amount charged to the home warranty provider per claim. The majority of providers provide coverage for older homes, however some don't cover items in the home with preexisting conditions.

What are the advantages of a home warranty for rental properties?

1. Protection against high repair costs

A home warranty is used to shield rentals from expensive repair costs. It provides fast service, ease of use and has no charges for service. This will reduce the amount of time and cost needed to repair your home and also provide financial protection in the event of unexpected repairs or replacements. In addition, the insurance coverage for regular maintenance helps increase client and tenant retention because tenants are able to request service without landlord approval and covered appliances and systems are repaired swiftly, reducing the chance of having negative reviews. All of this helps landlords save money and charge more for rent, thus making more money for their pockets.

2. The coverage is for appliances used in the common household

What kinds of appliances are covered by the home warranty in rental properties? (Expanded List) Refrigerators and dishwashers, clothes dryers and clothes washers; trash compactors; ranges/ cooktops/ ovens; built-in microwave ovens and built-in food centres; HVAC systems, heating electric systems; water heaters garbage disposals, central vacuums, smoke detectors, smoke alarms; plumbing systems. Doorbells, ceiling fans, exhaust fans septic tanks, sump pumps spas, garage door openers.

3. Peace of mind knowing repairs will be made

Landlords enjoy many advantages from having repairs covered by a warranty on their home. Landlords do not have to pay cash-on-demand for maintenance and repairs. Additionally, a home warranty program makes it easier to complete the home repairs procedure for all involved by making a claim with the warranty company, who then sends a technician to the rental property to fix the problem. Property management companies can expect less third-party contractor invoices and insurance costs because of the fact that a lot of repairs and replacements are done quickly. A home warranty for rental properties also helps in enhancing client and tenant retention by dealing with the primary reason that causes tenants to leave: maintenance issues. When tenants are able to make requests for service with no permission from the landlord, covered appliances and systems can be repaired quickly, resulting in less opportunity for negative reviews from frustrated tenants. Overall homeowners' warranties provide landlords with a cost effective and effective solution for repairs to rental properties.

4. It reduces time as well as making it simple to locate contractors.

A home warranty could be an efficient way to find a contractor. Instead of having to search for a reliable contractor an instant, landlords could make a claim with their home warranty company. They will dispatch someone to their rental home to fix the problem as soon as possible. This could be easier than needing to call multiple contractors to determine the most suitable one for the job.

Property managers on the other hand are able to save time and hassle by sending a trusted vendor they have already worked with to manage a home. They know the prices, the workmanship and the way the vendor has conducted themselves in the past. This means that they don't have to spend time researching and choosing the best contractor for the job. In addition, contractors who have been properly trained are more likely be kind and ethical towards tenants. This is crucial for tenant satisfaction.

Furthermore, getting assistance from a home warranty provider can take longer than expected in some cases, taking several days. This can lead to unhappy tenants, who want their repairs to be dealt with quickly. This adds to the discontent. Property managers are an intermediary between tenants, the home warranty provider, and property owners.

A home warranty is an ideal option to cut down on time and avoid the hassle of hiring an expert contractor. Property managers can send reliable vendors they know to manage homes, and homeowners can make a claim to their warranty company and have the issue resolved in no time.

5. Ability to budget repairs

Utilizing a home warranty plan to help with repairs and replacements of home mechanical systems and appliances can make budgeting for operating expenses much easier for property owners who own rental properties. A home warranty program helps to make repairs more predictable, keeping tenants content and improving the overall bottom line. Additionally, it provides greater convenience, as it provides an all-in-one solution for all home maintenance repairs and replacement needs, while not having to change money during service calls. Additionally having a home warranty can help lower the owner's annual expenses by covering the majority or all of the cost of repairing and replacing aging or malfunctioning appliances and systems.

6. Protection against landlord liability

A landlord's home warranty guards against liability for landlords. It offers expert repairs for appliances and systems that are failing due to wear and tear or aging. Tenants are less likely to be able to sue landlords due to repairs and replacements for appliances and systems are completed swiftly. Repairs covered by the warranty reduce the need to seek approval from landlords and can also settle disputes. This reduces landlord liability. A home warranty could provide additional financial protection as it's tax-deductible, and aids to offset rental costs.

7. The ability to select between various warranty providers

It isn't easy to select a home warranty provider for rental properties. It's crucial to look at the choices for coverage, the cost and industry reputation, the customer support, and other features. When choosing a provider for your home warranty, we recommend considering the plans for service and additional options available, price as well as the reputation of the company and its customer support infrastructure in addition to other features. You should also be aware of the possibility of choosing your own contractor and then upgrade the coverage you have. Additionally, consider how simple it is to transfer your plan from one owner to the next.

Based on our findings, plan coverage is the one that should be considered most important, with customer support as the second-most important factor. Industry reputation, plan availability, and additional features should be rated equally as well as price. Price shouldn't be the sole basis for choosing the right home warranty provider to suit your needs.

For example, if your rental property has a saltwater pool, appliances from the pro-series, or a reverse osmosis system Liberty Home Guard has a collection of additional features that might appeal to you. AFC Home Club provides additional security in the event that you're unable to repair the issue within the 30-day workmanship guarantee. The HomeServe plans that are tailored to your needs are a good alternative for those who are concerned about the lines of electricity that are connected to their rental home. American Home Shield is a better option for those looking for more coverage.

We suggest getting quotes from at least three home warranty companies and taking the time to read the terms of the agreement to make sure you are aware of any exclusions or limitations. This will enable you to make educated decisions and assist you choose the right provider of home warranties for your rental properties.

8. You may take advantage of discounts or other incentives

A home warranty plan for rental properties could help reduce costs by two methods. These plans offer a convenient and low-cost way to fix major appliances that fail. This could save landlords the expense of regular repairs. The second advantage is that the premium and service fees of the home warranty plan can be included on tax returns as operating expenses, depending on the registration of the landlord. This can reduce their overall income and tax burden.

9. Ability to submit and track repair claims online

Warranty plans for home owners can be extremely beneficial for rental properties, by making repairs easier. Landlords only need to file a claim with their warranty company if the covered item fails or fails to function. The company will send an expert to the rental property to address the issue as soon as possible. This will save landlords time and effort searching for a trustworthy contractor that can be reached at short notice. By providing expedited service and ease of use, home warranty plans help landlords to ensure the rental property they lease is looked after quickly and effectively.

10. Greater tenant satisfaction

Tenants can benefit from a variety of benefits of a HomePRO Warranty, including enhanced service and greater customer satisfaction. HomePRO Warranty helps to reduce service calls as tenants can submit requests directly, without waiting for the landlord's approval the request. This helps improve the relationships between tenants and landlords. In addition, HomePRO Warranty eliminates the requirement for landlords to deal with multiple vendors, as the warranty covers repairs and replacements for various systems and appliances. In turn tenants have the peace of mind knowing that their needs are met promptly and efficiently. A house warranty, which can raise the rental value of the home as well, is a fantastic option for landlords who want to earn more each month.