Raising my FEE!

Seems like it’s time to charge what I’m worth, going for $300 per hour. Why cant we get back to an hourly rate?

I mean as a professional that should not be too much to ask. There is someone in DFW charging $99 per inspection… so I should get tons of business now… Surely customers will see value added in paying the professional hourly rate?

Attorney $350 per hr
IT Architect $250
Architect CEO $300
DR. $500 per hr

Average Inspector $100 per hour if your lucky…

www.nachi.org/fee-calculator.htm

You have to play with it for a while and adjust the “Standard Rates” box to get it set up to work the way you want it to.

Nick I like the Calculator that works great.

There’ll always be the guy that calculates his fee as follows:

$3.50 - A gallon of gas to get there
$3.50 - A gallon of gas to get back
$10.00 - Lunch money
$50l.00 - per hour on site (two hours max) (Hey, he only makes $15.00 hour at day job)
$10.00 - Some beer money afterwards

$127.00 for a full home inspection

And there’s always gonna be the type of client that not only wants that, but deserves it to.

My thought is that really we can’t set the fees on what our own concept of what we are worth is, it must compete in the market. My fees are in line with my local competitors… Although I have a hard time seeing how they are making more then $80k a year. Seems like max of $108k if fully booked at 363 inspections a year… Using average of $300 each… THAT’S why I’m saying the fee needs to average $400 each…

Can anyone really book that many? I think 200 is a more reasonable number…

BUT I LIKE ASKING FOR BEER MONEY AFTER…GREAT IDEA!

I am sure that the people that charge extremely low fees are worth exactly what they are being paid for!

If you want to raise your fees, you have to quit worrying about the other idiot out there that doesn’t know his a s s from a hole in the ground.

There’s always going to be some idiot out there that thinks he’s making $80,000 a year until tax day shows up and he finds out that he is in the hole and can’t pay the government their share.

So my recommendation is you quit worrying about your competition and for God’s sake do not adjust your fees according to those idiots!
If you can’t figure out what to say to your client when they say well Joe Smith down the street (sorry any Smith out there) said he couldn’t do it for $100 less, you probably should not be in this business because you will never achieve what you are actually worth.

So many people go out there and increase their education, experience and services to only give them away for free to compete with the idiot that are new in the business and don’t realize what the bottom line turns out to be when all is done and over. It’s like the homeowner that buys a house with a crappy HVAC unit and goes bankrupt when it breaks in two months because they put every penny they had into the home purchase without considering that the damn thing needs to be maintained and things will break requiring replacement.

There are highly experienced and educated home inspectors here that post all of time about how bad the economy is and how competition prevents their success. These people became what they are in spite of themselves because the market allowed for their inability to market themselves properly.

100% of the buyers out there are not looking to get the cheapest inspection out there. This is not like paying your taxes, you want to save on every single dollar you possibly can because you feel you’re getting nothing for your alleged investment in the government.

I got a call last night from a wife that was shopping around for her husband’s decision on a home inspector. Obviously they were looking for a good price (because they really didn’t understand any other scale to rate a home inspection on). During the interview, she related that they had put careful consideration in the purchase of their home and why they chose the home they did. She stated that her husband “wanted to know everything about the house” before they purchased it. If you didn’t recognize it, this is a “key phrase”.

So what do you do with this key phrase? Yes, I’m asking you.
It is quite obvious that they want a home inspection for a specific reason, not that they’re just doing it because that’s what they’re told to do.

It is quite obvious that they don’t understand that they cannot get “I want to know everything about the house” through a home inspection based upon the basic standards of practice. You know, the standards of practice that you subscribe to as being a generalist and not a specialist or expert in any field!?

By the end of the conversation, my ability to be able to schedule an inspection within the timeframe they needed became paramount to the cost of the inspection.
The inspection is located in a service area that is totally upside down, saturated with home inspectors that work for free. Real estate agents that are total idiots. General contractors who won’t even turn the power on in a new house. AHJ’s that give occupancy permits to houses that have no electric service yet!

And to top it all off, I could care less whether I got the inspection job or not.
This was a buyer that had already talked to a half a dozen home inspectors. What made her change her mind (or make up her mind) that she was not interested in what the other inspectors had to offer?

It takes a little guts to operate your business without regard to what your income next week is going to be. It takes some guts to turn down a potential client because they really don’t know what a home inspection is and are only concerned about the price.
Someday the light will come on when you come to a point that you had enough of home inspection and you really don’t care if you do another one. So you just jack up your price because you really don’t want to do the inspection anyway, hoping that they’ll just go away. You can find a bunch of these inspectors over at NACBI who wake up every day and pray the phone doesn’t ring for another love shack inspection!

I have read blogs from home inspectors many years ago that wanted to retire and figured the best way to downsize was to upsize their inspection fees. The result in every case was that they made more money per inspection and they got more inspection requests then they could handle, even in comparison to when they were out there as a youngster lowballing every phone call that came in.

First of all they have been around for a while and they know more than the average newbie, so they’re worth more (they just didn’t appropriately raise their fees as they became better at their job). Caution: Newbies cannot subscribe to this business plan because they don’t have enough experience and education under their belt. But as you become better (I’m talking to the CMI’s out there) you should not be competing with the lowball or the newbie. They will always be there. They will never go away. And their numbers will only increase in the future.

You need to realize what you’re worth and act what you’re worth when a potential client calls. You don’t need to get upset because the guy next door is charging $95 per inspection.

When I go to the store to buy a tool and I have to pay an extra 10 for one that doesn't say "China" on it, I am more than willing (as a matter of fact I'm elated to find a tool not made there) and am happy to pay the extra money. I pay .40 a gallon more for my gasoline that doesn’t have ethanol in it. I get 7 miles per gallon more and it doesn’t destroy my engine components (in the end it cost me the same as I only saved .002 per mile). I lost two chainsaws and a Weed Wacker to ethanol gasoline this year. .40 a gallon is a lot cheaper than the cost to replace/repair this equipment. So I gladly pay it.
You and your clients need to come to the realization of what the investment/cost ratio actually is.

As I said before, no one will invest in any service that they do not perceive its worth.

Thermal imaging: they don’t know what it is or is capable of doing.

Mold testing: they will only invest in these when they succumb to scare tactics or actually see it growing in the house.

As for the home inspection, if they feel they just want a basic inspection which is only worth $195 and you feel you can’t work for that fee then don’t do it. Turn them down. Advise them that because of your expertise/equipment availability they are taking up an inspection timeslot for someone else that needs it, but if they really want a good inspector to do their “basic home inspection” then they need to invest more than Mr. Smith down the street is charging.

You don’t have to be retiring.
I am not retiring, but when I was talking to the lady above I was driving down the highway at five o’clock heading to a $2,500 thermal inspection. Her $359 inspection is just “busy work” in comparison. So if I could not convince her of her needs for more than a low-end inspection, it really didn’t matter.

If you want your average home inspection fee to be starting at $400, then market to the people that are willing to pay for a $400 condominium inspection. Eventually you will find that real estate agents will not refer you because your base price is so high, but when they have a demanding client that just doesn’t want a Mr. Smith home inspection you’ll be first on the list. When they ask around the office for a real good home inspector because they have an atypical client, your name is on everyone’s tongue.

Just like starting out in the home inspection business as a rookie. It takes time. It takes work to produce work. This is not going to happen overnight but it’s a commitment that you have to have the guts to go for. In your mind, there is no guarantee it will work so it’s difficult to stick with the program.

As for those of you that think you should be allowed to charge $195 for a house up to 3000 ft.², you can probably afford to do that because you have not invested in the time, education and equipment to warrant charging a higher fee than this anyway. With low overhead you can generate a livable income at low service fees. But this prevents you from expanding and growing by investing in education and equipment that can increase the quality of your inspection. Inspectors that invest in the low-end business plans seem to get stuck at that level and voice their frustrations about people that charge lower than they do because they know that they’re worth more and they’re not allowed to charge more because someone else out there who’s not worth more is charging what they’re worth.

[size=2]“If you continue to do what you’ve always done, you’ll continue to get what you’ve always got!”

And that’s all I have to say about that!… :slight_smile:
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David,
I don’t always agree with everything you have to say, but this is one of those cases where you are dead on!
Jeff

Finally some good feedback without bashing…I like that!

I’ll get there… my last one was a 1500 sf condo built in 2007, I did it for $285… Only took 2 hours to do so I feel it was priced right.

Yeh but Phillip, does that 2 hours include writing the report? That’s what always takes longest for me.

Well add 2 hours for the report, E&O, travel, gas, heath insurance etc., etc., and you’re down to $12.57/hr.:wink:

You forgot adjusting for beer money for after the inspection as Erby and Phillip mentioned. Down to $7.50 an hour. I do like to do my reports at happy hour. Kill two birds w/ one stone.:stuck_out_tongue:

In your case Joe, that would be down to $4.25, and on Saturdays you pay them! :wink:

Well Jeff, that’s why I multi task at the sports pub @ the end of the day. Write my report on my laptop, have a cold one (or 5), grab a bite, watch the ball game, and check out the scenery like Steph. :smiley:

“A bite”… is that what you call her these days? :wink:

No wonder you haven’t hired her yet. Wouldn’t be able to push that line. :twisted:

:shock:

Recycling pic’s not allowed Joe!:wink:

Boy, I would take some love bites off that one Joe. She sure looks like a sweetheart. :slight_smile:

Jeff, who’s recycling? :smiley:

Did you say something? :shock::shock::wink: