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How $1k Can Make You $15k When Selling?

How a home warranty can make you $15,000 when selling your home.

Would you spend $1,000 if you knew it would make you $10,000?

It’s really simple. It’s called a home warranty and as a homeowner, you can offer a home warranty. Paying for a home warranty for the future buyer might seem counterintuitive in a hot real estate market. But it can actually help attract more buyers willing to pay top dollar for your home.

By preemptively, proactively offering the buyer a home warranty. What it’s going to do is, risk reversal. Basically, it’s going to lower the risk of buying your home. Right now, buyers are a little bit scared, right? They’re overpaying for homes. They’re having to waive their home inspection to be more competitive. If they felt more comfortable, confident, they’d be willing to pay more money. When you buy a used car, are you more likely to pay more money if it’s been inspected? Would you be willing to pay more money if there was a warranty associated with it? Absolutely. Same thing with your home.

The company that we work with is called Home Warranty of America. For $600, the buyer is covered for 13 months on all of the things that they wouldn’t be covered on, on their home insurance. Home insurance policies are great, but they are for catastrophic situations. They have big deductibles and cover things like major wind storms, major floods, major fires.

Whereas, a home warranty is for the little things like dishwashers, appliances, plumbing leaks, and more household-type problems.

In today’s market, 40% of buyers are first-time home buyers. They’re putting all of their savings down on your home and they have very little money left over if something were to go wrong. They have little margin for error, and if you gave them this warranty, they’re going to feel more comfortable getting a bigger loan for your home. That small gift is huge on the loan. If they increase their loan amount by 2% or by 3%, on a $500,000 home that’s $15,000.

When you list your home with the Nick McLean Real Estate Group and you say you’re going to do the home warranty, the home warranty company will cover your home during the listing process. If it takes six months to sell your home, you’re covered. We had a client, HVAC went out, dishwasher went out during the listing. They don’t even have a buyer yet. That home warranty company covered them and saved them thousands of dollars.

We also like to market the fact that you have a home warranty to all of the buyers, differentiating yourself from these new construction homes that are coming on the market. If you’re competing against new construction you’re going to want to be able to offer something to make your older home less risky. And It’s really a great way to increase the value of your home and the ultimate sales price by 2% to 3%. We always recommend asking your agent about home warranty coverage. It could save or make you a ton of money.

Call us for more information by talking to an expert 509.255.8070 always no obligation.

Nick McLean
Nick McLean Real Estate Group

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