As a realtor, you know that selling older homes can present unique challenges. While these properties often charm buyers with their character and history, concerns about potential repairs and maintenance issues can make some hesitate. This is where home warranties can become your secret weapon in closing deals on older homes.
Let's explore how leveraging home warranties can help you overcome objections, attract more buyers, and ultimately sell older homes more quickly and at better prices.
Understanding the Buyer's Perspective
When it comes to older homes, many buyers are enchanted by the architectural details, established neighborhoods, and the story behind the property. However, these same buyers often worry about:
- Outdated systems (HVAC, electrical, plumbing)
- Aging appliances
- Immediate repair costs after purchase
- Long-term maintenance expenses
These concerns can make even the most interested buyers hesitate. As their realtor, addressing these worries head-on can make the difference between a sale and a missed opportunity.
Enter the Home Warranty
A home warranty is a service contract that covers the repair or replacement of many home systems and appliances that fail due to normal wear and tear. For older homes, this can be a game-changer.
Here's why:
- Peace of Mind: A warranty reassures buyers that they won't face unexpected, major expenses right after moving in.
- Budget Protection: For first-time buyers or those stretching their budget to afford a charming older home, a warranty provides financial predictability.
- Easier Negotiations: If inspection issues arise, offering a warranty can be an effective alternative to price reductions or repair demands.
- Value Add: A warranty can be marketed as an additional feature of the home, increasing its perceived value.
- Competitive Edge: In a market with multiple older homes for sale, a warranty can make your listing stand out.
Strategies for Using Home Warranties Effectively
To maximize the benefits of home warranties when selling older homes, consider these strategies:
1. Introduce the Warranty Early
Don't wait for buyer concerns to surface. Mention the home warranty in your initial marketing materials and during the first showing. This proactive approach can prevent objections before they arise.
2. Educate Your Sellers
Some sellers might balk at the added expense of a home warranty. Explain how this investment can lead to a faster sale and potentially a higher sale price. It's often a small cost for a significant return.
3. Pick the Best Coverage
Work with warranty providers to select the best coverage plan for your specific property. If the home has an aging HVAC system or an older model of an appliance, ensure these are covered.
4. Use as a Negotiation Tool
If buyers are on the fence or asking for numerous replacements, offer a premium warranty plan as an alternative. This can be more cost-effective for sellers and more appealing to buyers. Just note, pre-existing conditions are covered by most plans.
5. Highlight the Transferability
Many home warranties can be transferred to new owners. This feature can be attractive to buyers who may plan to resell in the near future.
6. Partner with Reputable Providers
Build a relationship with a well-regarded home warranty company. Your confidence in recommending their services will be apparent to your clients.
7. Provide Real-Life Examples
Share stories of how home warranties have benefited other buyers of older homes. Concrete examples can be powerful in illustrating the warranty's value.
Addressing Common Objections
Even with the benefits of a home warranty, some buyers may have reservations. Be prepared to address these common objections:
1. "It's just another expense."
Response: Frame it as an investment in peace of mind and predictable home care costs.
2. "I prefer to choose my own repair services."
Response: Highlight that many warranties allow for some choice in service providers and that having a warranty doesn't preclude them from hiring their preferred professionals for non-covered issues.
3. "These warranties never cover what you need."
Response: Provide a detailed coverage list and explain how you've ensured this warranty is tailored to the home's specific needs.
4. "I'm handy. I can fix things myself."
Response: Emphasize that a warranty can cover major systems where professional help is necessary and can save them time and effort.
The Long-Term Benefits for Your Business
Successfully using home warranties to sell older homes can have lasting benefits for your real estate career:
- Referrals: Satisfied buyers are more likely to recommend you to friends and family.
- Repeat Business: When it's time to sell, these buyers may remember how you eased their concerns about buying an older home.
- Expertise Development: You'll gain valuable knowledge about home systems and common issues in older homes, further establishing your authority in the real estate market.
- Expanded Network: Building relationships with home warranty providers and service contractors can lead to mutually beneficial partnerships.
- Reputation Enhancement: You'll be known as a problem-solver who goes the extra mile for clients.
Example: Home warranties inspire confidence
Consider this scenario: You're selling a charming 1990s bungalow. The potential buyers love the wood detailing and built-ins but are concerned about the age of the HVAC system and original windows. Instead of a price reduction, you offer a comprehensive home warranty that specifically covers these elements. The buyers feel protected against potential issues, and the sellers avoid a significant price cut. The deal closes, and months later, when the HVAC needs a major repair, the new owners are thankful for the warranty, leading to a glowing review of your services.
Conclusion
In the competitive world of real estate, especially when dealing with older homes, every advantage counts. Home warranties can be that critical tool that tips the scales in favor of a sale. By understanding and effectively communicating the benefits of home warranties, you can address buyer concerns, protect seller interests, and smooth the path to closing.
By strategically using home warranties, you demonstrate your commitment to your clients' long-term satisfaction, not just to closing the deal.
Embrace home warranties as part of your strategy for selling older homes. With this approach, you'll likely see more satisfied clients, smoother transactions, and a growing reputation as the go-to realtor for classic and character-filled properties.
OnPoint Warranty is a Different Kind of Home Warranty Company
OnPoint Warranty was launched in 2018 by tenured and respected experts in service and warranty.
Our Whole Home Warranty products offer comprehensive, low deductible warranty protection for appliances, HVAC, plumbing and electrical systems, utilities and more, within and adjacent to, a home’s four walls.
Fully underwritten, 50-state whole home plans, available to realtors and property managers, home and auto warranty companies, builders and affiliates, improve market share across the US, while increasing renewal rates based upon excellent warranty service experiences administered by OnPoint.
Our white-labeled and branded whole home warranty plans can be offered during the listing period, at the closing or post-closing, seamlessly, reducing administrative costs for realtors, while increase closing rates and commissions, reducing unexpected repair costs for buyers.
fixHomz also provides realtors with real long-term revenue through high plan renewal rates driven by our best-in-class homeowner service experiences with OnPoint!
