Is that Home Warranty policy really saving you money or encouraging your tenant to say "no" to their lease renewal?
Investment Property Owners: We wanted to share an experience with you of what your tenant may experience if you carry a Home Warranty. We recently experienced this and therefore encourage all owners not to renew their Home Warranty by keeping this in mind.
Series of Events:
- Friday Night – A/C unit stops working.
- Saturday Morning – Tenant with 3 small children calls in to say the unit has stopped working. We immediately open a claim with the home warranty company.
- Sunday – Nothing, home warranty companies do not provide service.
- Monday Morning – Tenant receives a call from the vendor the home warranty company has assigned. They want to schedule a call for Tuesday afternoon, and the vendor has a 2-hour window. Tenant agrees but must take time off work for the appointment the following afternoon.
- Tuesday - The air conditioning tech goes out to the property and finds a faulty part. He calls it into the office and leaves the property. The tenant calls our office wanting to know what’s going on, but we don’t know. The warranty company doesn’t report to us. So, we jump on the phone and after an hour, we finally speak to a dispatcher, and we’re told they have ordered a part from the factory and will schedule another service call when the part arrives.
- Wednesday – Nothing
- Thursday - The vendor calls the tenant and schedules another service call for Friday because the part just arrived. There’s another two-hour window. Tenant must take another half day from work and is extremely unhappy at the lost time, extreme duress and inconvenience of not having A/C for a week.
What happens in a scenario where there is no Home Warranty policy?
We would have dispatched one of our air conditioning vendors right away, on Saturday morning. When they found the faulty part, they would have driven to the local warehouse and installed it the same day. Your tenant would have had a/c as early as Saturday night.
Our goal is to encourage good tenants to renew their leases; this is the real money saver! In order to attract and keep good tenants, we must provide services that make the properties habitable in an expedient manner, so your tenant’s feel valued. As an owner are you prepared to shoulder the expense of putting a tenant in a hotel while the warranty company completes the repairs? Or having the expense of releasing the property because the tenant decides not to renew? A Home Warranty is not a good choice to serve your investment property and more importantly, your customer, your tenants.