Most investors or turnkey real estate buyers know about home warranties. Many of us buy them or request them on a personal home purchase. However, most turnkey companies or properties don’t come with a home warranty. It’s just not an industry standard. Is it really needed? It is something you should ask for? Absolutely. And here’s why.
Repairs = Money Out of Your Pocket = Cash Flow Reduction
Repairs are inevitable. Turnover costs happen. It’s part of real estate investing. But a home warranty can greatly reduce these costs and help offset costly repairs for years.
Consider this. You buy a turnkey property and within one year, the furnace fails. Depending on the furnace size, you may be looking at anywhere from $1,000 – $5,000. On that same property, the water heater gives you issues in year two. That’s another $1,000 out of pocket. Then, out of the blue, the roof begins leaking in multiple spots and you have to replace it in year four. Another $5,000 out of your pocket. If you’re cash flowing $300 per month, you’ve taken in $14,400 in four years and shelled out $10,000. Your income? A little over $1,000 per year. Not ideal, right?
At Freedom Real Estate Group, our WRITTEN warranty is extensive.
We put written in bold because we give you proof and verification of your warranty. We don’t say it over the phone and refuse to put it in writing (yes, we’ve heard those horror stories). We give you a written warranty at closing. Plus, it’s part of our purchase agreement.
Our warranty – that is provided with EVERY property – covers one-year on all rehab related items, three years on the water heater and all HVAC components, and 10 years on the roof! Yes. That’s not a typo. Ten year warranty on the roof. If anything happens to those items within those time frames, we repair or replace it at our expense. Considering the above example, this warranty alone is worth $10,000 – $15,000.
Why do we do it? Because we believe in our product, the quality of our rehab, and overall – it’s just the right thing to do. Our clients are buying turnkey properties. Not properties that they want to repair and put money into throughout ownership. That’s not what we’re about it either. We want to you trust in your purchase and know that we’ve got your back if anything happens. And we will put that in writing.
Want to learn more about Freedom Real Estate Group or our Written Warranty?
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