Home inspector frustrated by inspection fees

Posted1/15/2016 1:00 AM

Q. I've been a home inspector for about eleven years and am frustrated by the price pressure throughout the inspection business. When I think of the time and effort that goes into a thorough inspection, the valuable information I provide to my customers, how much I save them in future repair costs, taking responsibility for things I might miss, not to mention crawling under houses, it's amazing to me that a mere $50 price increase will cause homebuyers and agents to look for another inspector. Why is this such a problem in our business?

A. The only ones who prevent home inspectors from charging reasonable prices are home inspectors themselves. Other service contractors raise their prices as overhead costs increase. But home inspectors simply absorb the costs of $4 per gallon gasoline, rising insurance rates, rising prices for business supplies, etc. As expenses go up, the self-imposed price competition among home inspectors allows expanding overhead to diminish the bottom line.


The price freeze among home inspectors is caused by fear. Experienced home inspectors are simply afraid of losing business to each other, particularly to upstart inspectors who use sacrificial prices to attract customers, while providing little in the way of accurate or detailed disclosure. Frustrated by frozen prices, many home inspectors increase their incomes by packing their schedules with more inspections. This increases their liability for defects they might overlook and leaves little time for family and personal life. To make matters worse, home inspectors are afraid to discuss this issue with colleagues, lest they be accused of price fixing.

The only solution is for the more experienced home inspectors to set aside their fears of discussion. An inspector can mention a price increase to competitors without suggesting numbers. This informs other inspectors that they are free to do the same. Each inspector can set fees at levels that are consistent with the quality and value of the service rendered, to cover operating costs and to provide a reasonable income for the hours worked.

If real estate agents and buyers find that the price range for the best home inspectors has gone up, they will have a simple choice: Get a top-notch home inspection for a fair price or get a substandard inspection for a cheap price. The best agents will stick with the best inspectors, and their clients will get what they pay for. If you lose 10 percent to 15 percent of your business because of higher fees, the loss can be more than offset by a 20 percent to 25 percent increase in price. Many home inspectors report no loss of business after raising their prices. It's just a matter of overcoming the fear to do so.

A retired home inspector wrote an article about this many years ago. When he began what was to be his last year in business, he decided to pull out all the stops with regard to price. To his surprise, the more he charged, the more work orders he received. He found that people equated the higher price with higher quality, and he lamented not having realized this years sooner.

• To write to Barry Stone, visit him on the web at www.housedetective.com, or write AMG, 1776 Jami Lee Court, Suite 218, San Luis Obispo, CA 94301.

© 2016, Action Coast Publishing

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