Home Warranties; Are They Worth It?

Home Warranties tend to be a tepid topic of discussion in the real estate industry. Some have never heard of a home warranty, the uninformed think they're a waste of money, and a select few truly understand their value. One of the biggest providers is American Home Shield, and they have a variety of products at various prices. These warranties typically last for one year (though you can purchase a warranty for a longer period of time if you so choose). These warranties cover a variety of things, and are essentially a financial hedge to help cut down the cost to repair or replace items and/or systems when they break down. For example, American Home Shield offers a Shield Complete warranty for $635, Shield Plus warranty for $515, or Shield Essential warranty for $340. They also offer Sellers Coverage for $0.93 per day, which is an absolute no brainer in my opinion. Say you wanted to list your property for sale, we put it on the market and after a few days we receive a strong offer that we accept, the very next day I would call American Home Shield to create a Seller's Coverage policy. Meanwhile, the buyer's agent is calling around to schedule their inspections, let's say those inspections uncover three plumbing leaks, a defective garage door opener and damaged HVAC ducting. The seller could then pay $100 to have a plumber come out and fix the three leaks (which normally costs about $200 per leak to correct), another $100 to have the garage door opener replaced (typically $600-$800), and then another $100 to have the ducting repaired/replaced (I haven't had this specific issue pop up in a deal yet, but my research shows that would likely cost about $300). Without the policy in place, these repairs would be about $1,500.

With the Seller's Policy in place, the seller is looking at a bill of $300 for the work, plus $0.93 a day for the duration of the escrow (most escrows are 30 days, so roughly $30) totaling in $330, which equates to a $1,170 savings in this fictitious scenario. Of course there could be complications in the process, for example in some rural areas it can be hard to find an approved technician. Once you pay the $100 service fee the technician will come to the property and take a look at the issue and decide if it was an obviously detectable pre pre-existing problem or not. If the technician decides it was an easily detectable pre-existing issue, then the warranty will not cover the repair.

They also offer a ton of different add-ons to the policies as well, such as an electronics package that covers TVs, computers and tons of other household electronics. They also have well system coverage, septic system coverage, pool and spa coverage, and ADU coverage for units under 750 square feet.

https://r4hcxb3d.media.zestyio.com/2024-AHS-Digital-Brochure.pdf - Product Brochure

https://r4hcxb3d.media.zestyio.com/Additional-Services-and-Special-Member-Offers.pdf - Additional Services

https://r4hcxb3d.media.zestyio.com/CA__2023_AHS_SampleAgreement.pdf - Sample Agreement

Want to buy, sell or invest? Call me today at (707) 616-8752!

• New listings experienced a dramatic dip, from 82 last week, to 52 this week.

• Pending properties increased this week, up 39 spots to 35.

• 21 properties closed escrow this week, the exact same as last weeks mark.

If you find yourself dreaming of calling Humboldt County home look no further! By clicking the button below, you will be whisked away to my website where you'll have access to all of our local listings straight from Humboldt Counties Multiple Listing Services, aka the website real estate agents use to post their listings. As you can imagine, it is the most secure and accurate place to find detailed information on all of Humboldt Counties listings, so please tap below and get to searching! If you'd like, I can always create a property search for you, then as soon as a new listing hits the market that matches your desired criteria, it would automatically be sent straight to you!

March Market Report for Arcata

March Market Report for Eureka

March Market Report for McKinleyville

Humboldt Bay North Jetty

Current Interest Rates via Mortgage News Daily

Golden State Warriors Schedule

San Francisco Giants Schedule

San Francisco 49ers 2025 Opponents

(707) 269-2334 - HumboldtHomeLoans.com

CalBRE - Lic # 01226140 NMLS #294953

Newest Ad - Del Norte Pier, Eureka CA!