馃攳
What is a Home Warranty? Home Warranty Cost | Should I Purchase a Home Warranty for a Condo? - YouTube
Channel: Matt Leighton
[0]
How's it going everyone?
[1]
Matt Leighton, welcome back to another video.
[2]
In this video, we're going to talk about whether
you need to purchase a home warranty when
[6]
you're looking to buy a condo.
[8]
I'm here in Colonial Village in Arlington,
Virginia at my new listing in the neighborhood.
[13]
I'm going to put a little video tour link
right here so you can check it out.
[18]
Anyways, let's talk home warranties and condos.
[21]
First of all, what is a home warranty?
[23]
Well, when you're filling out a contract,
when you're writing an offer, there will be
[27]
an offer for a home warranty policy.
[30]
This is different from home owner's insurance.
[32]
Basically what it is, is a policy that covers
the inside of the condo.
[37]
The systems.
[38]
Things like electrical, utilities, plumbing,
HVAC, furnace, water heater, things of that
[45]
nature.
[46]
And the policy is good for about a year.
[48]
So basically you're insuring yourself for
a year if something goes wrong, you get a
[53]
free...if the dishwasher starts leaking or
it's broken, you get a free dishwasher or
[58]
an extremely discounted dishwasher.
[60]
How much are they?
[61]
Well, they're around $450.
[64]
Here's the main point:
[66]
Is it worth it buying a home warranty for
a condo?
[70]
The answer is...
[71]
No.
[72]
It's not worth it.
[73]
And let me tell you why.
[74]
This condo right now that I'm standing in
is 600 square feet.
[77]
Your condo is going to be 600 square feet.
[80]
Or it's going to be 800.
[81]
Or 1,000.
[82]
Or 1,500.
[83]
Not much can go wrong in that small amount
of space.
[87]
Even if something does go wrong, it's going
to be a very minor charge.
[91]
It's going to be a very minor fix if the dishwasher
is leaking or you have a plumbing issue.
[96]
It should be very minor.
[98]
Now let me finish this, if it is major, one
of two things could happen...
[102]
Either number one, it was something that came
up in the home inspection and maybe you could
[108]
have negotiated and gotten money at that point.
[110]
Maybe the HVAC was past its useful life or
the water heater was not installed properly
[116]
and needed a new steel hose.
[119]
Or number two, it's just some sort of freak
accident.
[122]
Some crazy thing that happened that you could
not have predicted.
[125]
Either way, I still think $450 as an upfront
payment because it's paid by you at settlement.
[133]
Sure you can try to negotiate and get the
sellers to pay for it.
[136]
But if you are competing, that's just another
thing that is going to make your offer worse
[142]
than my client's offer or than the next best
offer.
[145]
I don't think it's worth it.
[147]
Now, you might say to yourself, 'Matt I want
to insure myself.
[150]
I want to protect myself from that emergency,
that freak, that AC going out in the middle
[156]
of summer and I don't want to pay $3,000 for
a new A/C unit.'
[160]
Well I sill think because you're in a condo,
the HVAC has experienced not as much stress
[166]
as if you were in a house.
[168]
There's less to heat, there's less to cool.
[170]
I think you are basically going to lose $450.
[172]
And when you pay it, you're almost going to
want something to go wrong in order to redeem
[178]
that money that you spent.
[180]
I think it's more of an intrinsic value that
$450, where it makes you feel good, but you're
[187]
never actually going to use it.
[189]
Now, a lot of times the HVAC, the water heater,
and the furnace are already past their useful
[195]
life but they're still working because this
is 600 square feet.
[198]
You don't need it to pump out 2,500 square
feet worth of heat or of A/C.
[206]
If you pay $450 now to insure yourself, it
will feel good.
[209]
But let's say you buy the home warranty, pay
the $450 now.
[212]
Are you going to pay $450 the next year and
the next year?
[216]
You live there for 5 years, and you're paying
$2,000.
[219]
At that point, why don't you just pony up
and just buy a new HVAC unit or A/C unit as
[226]
it is.
[227]
I think this is an extra line item charge
that is simply not necessary for condo owners.
[232]
Is there a risk?
[233]
Yeah, absolutely.
[234]
If this was a house or townhouse, it would
be a much different story.
[237]
But I think for 1 year, $450 is just another
item that is taken out of your pocket that
[243]
you will probably not going to see the value
on.
[246]
So if you're not competiting with another
offer, maybe try to squeeze that out of the
[251]
sellers but for the most part, you're not
going to have an opportunity to redeem that
[257]
$450 when you're living at a condo.
[260]
That's all I got for you today.
[261]
Hope you found this video helpful, thank you
very much for watching.
[264]
Until next time, create a productive day.
[266]
Take care.
Most Recent Videos:
You can go back to the homepage right here: Homepage