As a home builder, you’re probably used to offering 1-year new home warranties as standard procedure when contracting for a new property. The idea of extended structural warranties may be relatively new to you, but countless builders across the country increasingly select this option. If you’re new to 10-year warranties, consider the following.
What Are the Benefits?
By expanding warranty coverage for a property, a 10-year warranty protects homeowners from catastrophic costs that could occur after a traditional builders warranty expires. This type of extended warranty protection also helps to confirm a buyer’s confidence in the quality of a builder’s work. In turn, the warranty becomes a major selling point, especially for buyers who appear especially reluctant to assume even the smallest risk.
Even well-made properties can experience structural damage; in fact, one in four homes eventually suffers some type of structural distress as the years pass. Since these issues typically cost an average of $42,500, it’s easy to see how long-term warranty protection can benefit a homeowner.
At the same time, a 10-year warranty can also boost a builder’s brand. To qualify for an extended structural warranty, a builder must meet strict financial and experience criteria. This can help builders differentiate their companies from the competition. A good structural warranty also increases the overall value of a property in a competitive market.
What Is Included?
Frightened by stories about crumbling foundations, buyers often demand additional warranty coverage to protect their homes’ integrity. In turn, they may request “a builder foundation warranty” to insure against potential repair costs. While they do provide coverage for foundation issues, structural warranties also protect against unwieldy costs related to other key load-bearing components, including:
- Floor framing
- Girders and beams
- Footings and foundation systems
- Load-bearing partitions and walls
- Floor framing
- Roof framing systems
How Much Coverage Do You Really Need?
While comprehensive risk management comes with obvious benefits, it may not be appropriate for every situation. Fortunately, when it comes to choosing warranty coverage, builders have several nice options, including:
- 1-year warranties that provide surety coverage against defects in materials and workmanship
- 2-year warranties that cover defects in piping, wiring, electrical, heating, plumbing, cooling, mechanical and ventilating systems
- 10-year warranties that cover structural defects and load-bearing components
To gain the confidence of their buyers, leading builders often select complete 1-2-10 warranty coverage. While not essential, this can go a long way toward piquing buyer interest when comparable properties are in large supply. Because they are fully transferable, long-term home builder warranties also allow buyers to command higher prices if they decide to sell their homes later. More importantly, since they provide comprehensive risk management, 10-year warranties offer valuable peace of mind that can make a buyer more willing to invest in a new property.
Having paid over $250 million in structural defect claims, 2-10 HBW helps builders protect their customers and their brands. Let us help you select comprehensive warranty coverage for your new builds.