Selling a Home in LA? Make It More Attractive with a Home Warranty


According to predictions, the California housing market will slow down come 2020. In fact, the signs of it are even evident today. Therefore, anyone selling properties in the state needs to learn how to make them more attractive, One of the methods available to you is purchasing home warranty coverage. This is a small investment for the seller, but it can make a big difference for the deal.

What Is a Home Warranty and How Can It Help You Sell a Home Faster?

Home warranty plans are a way for homeowners to protect themselves from major unexpected expenses caused by a breakdown of home systems and appliances. You can think of it as a manufacturer’s warranty. But instead of covering one appliance for a limited time, this plan will cover multiple appliances and even structural home systems (vents, plumbing, roofing, etc.). The duration of a home warranty plan is a year by default, but you can extend it indefinitely.

Also, an important difference between a regular manufacturer’s warranty and a home warranty is that the manufacturer’s plan only covers you in case of a breakdown caused by inherent product defects. A home warranty plan will provide coverage for a variety of situations.

Home warranty coverage helps save money for homeowners because this plan can cut the repair costs if some major appliance breaks down. Considering that appliances and home systems today are rather expensive and the majority of Americans can’t easily spend a couple hundred dollars on repairs without severely straining their budget, the plan can be a huge help.

The cost of the plan is about $400-600 a year, on average, and it can be broken down into monthly payments. Therefore, the potential for savings is significant. And even if you end up not using the coverage during the year, you won’t lose that much money for the peace of mind.

Home sellers, however, benefit from the home warranty in a different way. This coverage serves to prove the buyer that should anything happen, they will be protected no matter what. Apparently, buyers appreciate this reassurance enough so that homes with these plans sell not only about 11 days faster, but also for $2,300 more on average. Considering that the cost of the plan is less than half of that, this coverage is a good investment for the seller.

How to Choose the Best Home Warranty When Selling a Home in California

There are about 180 home warranty providers in the US and the industry is growing rather fast. Many of these companies provide coverage in several states. However, California’s offering is limited. That’s because the state has multiple regulations so it’s more difficult for these businesses to register and obtain necessary certifications.

On the one hand, it’s a good thing because you can be more confident that the warranty provider you choose will be trustworthy. Not honoring contracts and claim denials are the most common problems associated with home warranty plans. And companies can get away with this because the industry is very poorly-regulated. Therefore, the strict regulations set in California are a bonus.

On the other hand, fewer options mean less competition and only a limited selection of plans.

This means that you might not be able to find a perfect coverage. Also, companies competing in this market might not offer very flexible terms and the lowest rates because they lack the incentive.

However, you should understand that the home warranty industry is very unbalanced. Over 60% of it belongs to the ten top companies, so California residents definitely aren’t missing out on good terms and plans.

The leading companies that offer home warranty plans in California (and many other US states) are:

  1. First American Home Warranty.
    FAHW is one of the industry veterans and also one of the companies with the largest coverage in the country. It’s accredited by the BBB and has rather low costs for optional coverage. It only has a couple of plans, but optional coverage allows to customize them effectively to fit many homeowners.
  2. Select Home Warranty.
    Select is a good choice if you manage to get one of their yearly promotions. This is another company with extensive coverage and it has a good selection of plans to fit multiple situations. Select is rather fast in delivering repairs and answering claims.
  3. HomeServe USA.
    HomeServe is a smaller company with its coverage available only in a handful of states. However, it’s solid on providing quick help and has a lower chance of claim denial than the industry average. Also, it is not only accredited by the Better Business Bureau but also has an A+ rating, which is extremely rare in this industry.
  4. 2-10 Home Buyers Warranty.|
    2-10 is a dependable home warranty provider with extensive coverage and A rating with the BBB. The company has few plans and optional coverage options. But it’s known for quick and efficient responses to claims and low risk of claim denial.
  5. American Home Shield.
    AHS is the leader among all home warranty providers in America and over 40% of the industry market share belongs to this company. It offers rather extensive coverage and it does meet its payment obligations. However, there are also reports of payment delays and various other issues. This company has tricky terms and conditions that often enable it to deny claims legally.

Home Warranty for a Home Seller: Should You Get It?

Considering that the benefits of home warranty definitely outweigh its cost, home sellers should use these plans. However, remember that homebuyers know how these plans work as well. Therefore, you should take time finding the best plan from a reliable company. This will be easier to do in California as the selection here is limited.

Make sure that the plan you buy will bring real value to the new homeowner, even if it’s not the cheapest plan out there. Buyers have to see that the plan is worth the added cost. They are sure to research it and if they see that it’s useless, the warranty might work against because buyers will see this as a trick to try cheating them.

Home warranty companies in California are rather versatile, despite the fact that they are few. Therefore, you should be able to find the perfect coverage with a bit of searching.

Check out our featured listings