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Updated over 1 year ago, 06/04/2023

User Stats

6
Posts
7
Votes
Stevenson Alexis
  • Rental Property Investor
  • Hollywood, FL
7
Votes |
6
Posts

Do you use home warranty companies for your rentals?

Stevenson Alexis
  • Rental Property Investor
  • Hollywood, FL
Posted

I’m seeing home warranty companies like American Home Shield offer maintenance and repair coverage for appliances, roof leaks, etc… with prices starting at about $40 a month up to about $100 a month for the “platinum package”… Anyone have experience with these companies? Is the monthly subscription worth it or do you all deal with maintenance issues as they come up?

User Stats

7,489
Posts
9,345
Votes
Bill B.#2 Real Estate Horror Stories Contributor
  • Investor
  • Las Vegas, NV
9,345
Votes |
7,489
Posts
Bill B.#2 Real Estate Horror Stories Contributor
  • Investor
  • Las Vegas, NV
Replied

 Click on the magnifying glass in the upper corner, this is literally asked monthly if not more often. Home warranties are always a bad deal< but they are really bad for rentals. The home warranty’s plan is to nickel and dime you on small repairs and delay, delay, delay on bug repairs. 

As an owner occupant you can decide it’s worth it to not have ac or heat for a week or two to save money. But a landlord can’t do that to a tenant in most states so you end up paying out of pocket or putting them up in a hotel. 

Imagine it’s 100 degrees outside and the ac stops blowing. You call the warranty company. They’ll have a guy out in a couple days, it’s only $100 or whatever it is. He comes out in a couple days, says he needs to order a part, it will only be 4-5 days. The part comes in and it doesn’t fix it, he’ll order another part, just another 4-5 days. That part does fix it, for almost a week.  Don’t worry they’ll send another guy in a few days. Guess what. He’ll order another part, just 4-5 days. Just hope none of those parts are on back order. 

The ONLY warranty that I would consider is probably available in more states than Minnesota. But their power company will let you buy the warranty after your heat/ac/some appliances are broken and send the repair guy the same day. It’s something stupid like $11/mo and you can cancel it the next day after the repair is finished. 

User Stats

6,603
Posts
6,945
Votes
Bjorn Ahlblad
Pro Member
#5 Multi-Family and Apartment Investing Contributor
  • Investor
  • Shelton, WA
6,945
Votes |
6,603
Posts
Bjorn Ahlblad
Pro Member
#5 Multi-Family and Apartment Investing Contributor
  • Investor
  • Shelton, WA
Replied

No. It does not work for rentals. 

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User Stats

2,403
Posts
3,793
Votes
Patricia Steiner
  • Real Estate Broker
  • Hyde Park Tampa, FL
3,793
Votes |
2,403
Posts
Patricia Steiner
  • Real Estate Broker
  • Hyde Park Tampa, FL
Replied

Bolt.  Don't do it.  Never. Ever.  

User Stats

42
Posts
14
Votes
Carressa Walker
  • Real Estate Agent
  • New Jersey
14
Votes |
42
Posts
Carressa Walker
  • Real Estate Agent
  • New Jersey
Replied

I signed up with Choice Home Warranty for one of my rentals and they are about $50/month for all items coverage.  

User Stats

2,183
Posts
2,657
Votes
John Morgan
Pro Member
  • Rental Property Investor
  • Grand Prairie, TX
2,657
Votes |
2,183
Posts
John Morgan
Pro Member
  • Rental Property Investor
  • Grand Prairie, TX
Replied

@Stevenson Alexis

Don’t do it for rentals. When it breaks, you want it fixed asap. Especially HVAC issues

  • John Morgan
  • User Stats

    73
    Posts
    6
    Votes
    Sam P.
    • Palatine, IL
    6
    Votes |
    73
    Posts
    Sam P.
    • Palatine, IL
    Replied

    We purchased a maintenance service for $12 a month(not warranty) and cancelled because we did not get any benefit from it

    User Stats

    2,956
    Posts
    3,085
    Votes
    Corby Goade
    Property Manager
    Agent
    #3 Managing Your Property Contributor
    • Investor
    • Boise, ID
    3,085
    Votes |
    2,956
    Posts
    Corby Goade
    Property Manager
    Agent
    #3 Managing Your Property Contributor
    • Investor
    • Boise, ID
    Replied

    Absolutely not- these companies are a scam. If you have a claim, they'll delay over and over, waiting for their preferred vendors to check out the problem, all the while, your roof is leaking, your tenants don't have hot water, etc.

    I run a property management company and we had many clients insist on using home warranty companies and we've actually had to put it in our contracts that we will not work with them. Never had a good experience and the tenant is the one who suffers, makes us all look bad. Probably attempted to work with 10 different home warranty companies and all of them have been terrible at best.

    Maybe on your personal home, but not on a rental.

    • Corby Goade

    User Stats

    377
    Posts
    378
    Votes
    Brad Larsen
    Pro Member
    • Property Manager
    • San Antonio and Austin, TX
    378
    Votes |
    377
    Posts
    Brad Larsen
    Pro Member
    • Property Manager
    • San Antonio and Austin, TX
    Replied
    Quote from @Stevenson Alexis:

    I’m seeing home warranty companies like American Home Shield offer maintenance and repair coverage for appliances, roof leaks, etc… with prices starting at about $40 a month up to about $100 a month for the “platinum package”… Anyone have experience with these companies? Is the monthly subscription worth it or do you all deal with maintenance issues as they come up?


     As a Property manager, NEVER.  You open yourself up to getting bad reviews when they do not show up in a timely manner, deny the claim, and ultimately leaving the tenant unhappy.  It will end up costing you on the back end.  

    Best,

    Brad

  • Brad Larsen