In the intricate landscape of real estate transactions, one term often crops up – the home warranty. This seemingly simple concept has the potential to greatly impact both buyers and sellers in the real estate market. In this article, we will explain the world of home warranties, uncovering their role in the real estate industry and exploring why they are sought after by both buyers and sellers.

Who pays for a home warranty: The buyer or seller?

One of the fundamental questions in home warranties revolves around who bears the cost – the buyer or the seller? In real estate transactions, this decision can influence the dynamics of negotiations and the appeal of a property to potential buyers.

When considering the responsibility of paying for a home warranty, buyers and sellers can take the initiative. Home warranties are not exclusively linked to the transaction process; they can be purchased independently anytime. However, statistics reveal that many home warranties in the United States are acquired in conjunction with a real estate purchase.

Why would a buyer want a home warranty?

Opting for a home warranty offers buyers many advantages. In the landscape of property ownership, where uncertainties can loom in the dark, a home warranty comes to light as a safety net, effectively mitigating the impact of unforeseen financial burdens. This safeguarding mechanism ensures that unexpected repairs and replacements don’t derail the buyer’s financial plans. 

Buyer’s home warranty


  • Savings on repairs: A major appeal for buyers is the potential cost savings on repairs and replacements of appliances and systems covered by the warranty. This can be particularly valuable for first-time homebuyers who may have limited experience with maintenance expenses.
  • Access to vetted contractors: Home warranty companies often maintain networks of pre-vetted contractors. This is especially advantageous for newcomers to a region or those lacking established relationships with trustworthy contractors.
  • Peace of mind: Knowing that significant systems like HVAC or water heaters are covered can give buyers a sense of security, reducing concerns about unforeseen repair bills.


  • Contractual exclusions: Home warranty contracts come with specific terms and conditions. Some appliances or systems may not be covered, or coverage might be limited. Buyers should carefully review the contract to understand what’s included.
  • Value variation: The perceived value of a home warranty can differ based on individual circumstances and the local real estate market. Buyers should assess whether the cost justifies the potential benefits for their specific situation.

Why would a seller want a home warranty?

Sellers, too, have many attractive motivations for contemplating the inclusion of a home warranty in their offerings. This strategic move can significantly elevate the allure of their property, imparting potential buyers with a sense of assurance regarding their prospective purchase. By extending this gesture, sellers showcase their commitment to the property’s upkeep and bestow buyers with an extra layer of confidence in their investment. This strategic advantage can set their property apart in a competitive market and facilitate smoother negotiations.

Seller’s home warranty


  • Protection for older appliances: A home warranty can safeguard older appliances and systems from unexpected breakdowns, reassuring buyers about the property’s condition.
  • Incentive for buyers: In a competitive market, a seller-funded home warranty can serve as an enticing incentive, tipping the scales in their favor.
  • Higher buyer confidence: Offering a home warranty reflects a seller’s commitment to the property’s quality, boosting buyer confidence in their investment.


  • Coverage limitations: Similar to buyers, sellers should be aware of the limitations within the warranty contract. Not all appliances and systems might be covered, potentially leading to misunderstandings.
  • Potential costs: While a home warranty can be a valuable marketing tool, sellers should consider the potential upfront cost. The cost and benefits balance should align with their selling strategy.

In the intricate dance of real estate transactions, including a home warranty can significantly influence buyers and sellers. Whether it’s the protection and assurance it offers to buyers or the enhanced marketability it brings to sellers, a home warranty has a role to play. Understanding the dynamics, benefits, and potential drawbacks is essential for making informed decisions in the dynamic world of real estate.

As the real estate landscape continues to evolve, the role of home warranties remains relevant, acting as a bridge of trust and confidence between buyers and sellers alike. To learn more or to get a home warranty, visit Porch Warranty.