Home warranty companies offer a service that is technically a service contract, not to be confused with builder warranties offered in new construction. These plans typically cover appliances should they need to be repaired or replaced, and the service is typically sold as an insurance policy to protect the property owner from unanticipated expenses resulting from inevitable repairs.
It is our opinion that home warranty plans are best suited for owner occupied situations where timelines can be more flexible. Home warranty companies, in our opinion, are not well suited for rental properties for several reasons, which I have outlined below.
Timeliness of repairs/service - It is our experience that home warranty companies, because of their procedures and their focus on cost savings, a quick resolution is near the bottom of their priorities. This of course, this appraoch is not in alignment with a tenant’s primary concern of getting an issue resolved as quickly as possible and taking 30 plus days to fix a fault water heater, or HVAC system for example, does not go over well with tenants, and rightly so.
Because in part of the frequent need for more than one vendor opinion, the process can take a long time, and there is frequently miscommunication between vendors and the Home Warranty Company, leading to a very inefficient and stunningly frustrating process - particularly for the tenant. Furthermore, the landlord has no say over what vendors are selected and some of the vendors we have encountered have been horrible.
The bottom line is as follows – one of the primary reason tenants decide not to renew a lease, is that they are not satisfied with how repairs are handled and how long it takes to get service. Whenever tenants leave, there are expenses associated with this and those expenses typically far out pace any money saved with a home warranty company. We do not recommend home warrnaty companies for our rentals as they cannot meet the strict expectations that we have of our vendors.