Getting a home warranty for an investment property in the US is usually not necessary. Most investors self-insure their properties to save on costs. However, home warranties may provide peace of mind for some. The average cost is $300-700 per year. Key factors determining cost include property location, age, size and claims history.
Most investors self-insure to avoid ongoing costs
Unlike owner-occupied homes, most real estate investors choose to self-insure their investment properties. This avoids having to pay several hundred dollars per year in home warranty premiums. Instead, investors set aside funds to cover any repairs and replace appliances as needed. This saves money over time.
Home warranties provide peace of mind
Although most investors self-insure, some still choose to purchase home warranties for their rental properties. Having the warranty coverage provides some peace of mind by knowing you won’t have to cover very costly repairs. It also guarantees repairs will be done properly.
Cost depends on property factors $300-700 per year
Typical home warranty costs range from $300-700 per year for an investment property. Exact pricing is based on the property’s location, age, size and claims history. More claims or an older home cost more. Condos also tend to cost less than single-family homes.
In summary, most real estate investors do not buy home warranties for their rental properties, instead self-insuring to save on costs. However, warranties provide peace of mind for some investors. Average annual cost is $300-700 depending primarily on property location, age, size and past claims.