The Resale Benefit of a Structural WarrantyMarch 30, 2015
This may seem like a topic builders want to skip over, but in fact it is one of the greatest marketing tools you have in your tool belt! Resale homes consume a large percentage of the real estate industry sales per year. When selling newly-constructed homes, Realtors understand that an important factor for buyers is the inclusion of a structural home warranty. However, they also find that it is just as valuable to future buyers when these homes are sold in the resale market. Warranties give homeowners the added bonus of insured security whether it is the initial buyer or the resale buyer. The original warranty provides the new homebuyer and the builder a definitive time that the insured structural warranty will remain in effect with the warranty company.
Structural warranties on new construction homes are only available to the buyer at the time of the original new home purchase. The written warranty document, given to the buyer, clearly states the terms and conditions of the structural coverage. The warranty stays in effect until the expiration date on that home, no matter who owns it. When the home is resold, the warranty transfers to the new owner and continues coverage on the home.
A recent study by the National Association of Realtors (NAR) surveying generational trends, showed the average time that a buyer lives in a home before selling is six to ten years. As a newly built home, when a builder has purchased an insurance-backed structural warranty, the owner has assurance that his property is protected in the event of a structural failure. When the time comes to sell that home in the resale market, the remaining years of structural coverage transfer to the new owner, giving the seller a resale advantage and increased value against competing properties. In addition, a Builder’s Warranty, whether it is first buyer or resale buyer, gives the new home owner an after purchase advantage and confidence in this continued coverage. In a competitive marketplace, combining this structural coverage with a specific resale extended home warranty protection plan for systems and appliances would put the new owner in the most positive position when purchasing their resale home.
A common question that warranty companies receive from Realtors is whether or not a structural warranty can be purchased by an individual buyer, so that they can secure the sale for a seller. As a quality builder, provide this assurance to your Realtors and potential buyers by already prioritizing a Builder’s Warranty in the home sales offering. Whether this is a first time sale or resale of a new home, structural warranties are often a strong negotiating factor in closing the deal. Set your company and your buyers apart in the marketplace by giving them the advantage through the sales process. Be sure to use this as a marketing tool for today’s sales as well as for your clients’ future resale. As a smart marketing and a risk management tool, include structural warranties as a part of every transaction.
*Source: NAR-11-3-14 Highlights of 2014 Profile of Homebuyers and Sellers https://www.scribd.com/doc/245372726/2014-Profile-of-Home-Buyers-and-Sel…