This article is based on an interview with Michael Marlow of Veteran Home Inspections which is a home inspection company that primarily does home inspections for real estate transactions, as well as mold, radon, and water quality testing. Michael is a veteran, hence the name of the company.
How Much Money Do You Need To Start A Home Inspections Business?
You need as little as $5,000. This includes the training class, which in Maryland was $2,000, basic equipment ($1,000), license fees ($500), and Insurance ($1,500).
Depending on the state you are in, you may need a home inspector license.
The biggest startup costs are training and insurance. As you go along, you will want to get additional training and equipment as well. The biggest continuing cost is advertising, which accounts for about a third of my monthly budget.
I get clients via advertising and referrals. I run a Google Adwords campaign, and also market to realtors for referrals. I am now getting to the point where about half of my business comes from referrals from either past clients or realtors for whom I have done inspections for in the past.
I work over 60 hours per week. Those hours are mostly doing inspections, working in the office writing reports, or working on administration and marketing.
I don’t have any employees right now, but I have considered bringing someone on in the next 6-12 months if the business keeps growing at this pace.
What Are The Product Margins? What Is The Most Profitable Thing You Do?
The profit margin varies, and is hard to calculate since most of what I provide is a service. It all comes down to the question of what my time is worth. With advertising, gas, and laboratory fees (for mold, water, and radon testing) I make about 40% profit.
This is a great business to get into and I am very happy with it. People are always going to be buying and selling homes, and most transactions involve a home inspection. I think the industry is going to continue to grow, and those that provide a quality service will continue to thrive.
I would recommend this business for someone that doesn’t want a set schedule in an office. Every day I do something new. I work with new people, as well as new homes. You must have great attention to detail because you have a limited amount of time to inspect a home, and your clients are relying on you to advise them on the condition of the home. A home inspector must also have great written and oral communication skills. You must be able to relay your findings to your client so that they fully understand your findings. Finally, just like any small business, you must have the drive to succeed and the flexibility and patience to handle a schedule that is not set.
Join a professional organization that supports you and your industry. I am a member of InterNACHI (International Association of Certified Home Inspectors) and the resources they provide have helped me grow Veteran Home Inspections quickly. They also provide high quality continuing education which allows me to add new services and increase the value of my services.
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