Tuesday rant…I apologize in advance for this rather long rant.
Lowballers are going even LOWER these days. The following email was forwarded to me by a Realtor in my area. He said that his entire office received this email and mentioned that he is getting marketing like this all the time.
From:I have removed the name. I’m too nice!
Sent: June-09-09 8:49 AM
Subject: Home Inspections
"Beat the recession.
and the Very Best
by a Professional Engineer
Does a thorough and a complete inspection from the basement to and including
the roof with
a 14 pages written report handed to you at the conclusion.
Total time is approximately 3 hours.
In full compliance with the Ontario Association of Home Inspectors
to August 2009"
Now, we’ve all seen crap like this before and most of us realize that lowballers are a part of the game in every business. As I’ve said hundreds of times to my clients and Realtors, “those who cannot compete on quality, value, service, or experience tend to compete on price”.
However, with a steady flow of recent graduates, lowballers have become an increasingly big problem in my area. There is the guy who advertises $199 inspections, and another that markets $249 up to 3000 sq ft., and a bunch more that charge $275, and there is even one moron that charges $200 for Pre-listings…and gets paid only if and when the house sells!!! Has anyone told this guy that more than half of homes go back off market!
I spend alot of time trying to educate Realtors and consumers about what a home inspection is and why most professionals should be charging at least $350 to $500 for a detached. (I start at $375 for semis and detached and $300 for small, new towns)
It has become increasingly frustrating to deal with but I refuse to join in on the price wars. Am I losing out? Am I missing something here?
True story - Wedneday of last week, a realtor calls to book a small 1200 sq ft, 2yr old town. I quote $300. She tries to haggle the price down to $250. After I ask her if she’s new to the business (she was) and give her an education about prices, I told her that I’d do it for $290 because it’s the first time she is referring me. We book. 10 minutes later she calls me again and tries to haggle down to $270!!! This is exactly what I said to her. “Lady, you’ll need to book somewhere else. If I have to charge any less, I’ll need to skip a room or two. Take me off of your referral list and do not ever contact me again! Ever!” She was shocked by my reaction and after a pause, she said that if I charge the client $270, she would refer me again. I refused. I reminded her to never to call me again and hung up.
Did I need or want that inspection? Of course. But not at the expense of being a hypocrite. So what is my point? The point is this. If we continue to charge less and we are open to negotiations, we will continue to water down the business. Consumers and realtors will assume that it is ok to negotiate our fees. Professional Inspectors need to stand their ground and charge a professional fee. Do not attempt to compete with the part-timers and fly-by-nighters. Stand your ground! How are we supposed to grow a business with no profit margins? How can you expand a multi-inspector firm? Are you forgetting to subtract: marketing and advertising, equipment, training and continuing education, office supplies, receptionist, answering service, report fees, phone, gas, in auto, internet, Insurance, etc, etc, etc.???
Please stand your ground. We are worth it!
Here’s a link from a CMHC article that states home inspections should start at $500 and up. Finally some common sense!
Any thoughts are appreciated