Thread: Time To Raise Prices

A buyer who got my name from her realtor has been on the phone with me a few times this morning trying to schedule an inspection that will fit in her schedule. I could hear how harried and frazzled she was on the phone trying to make square pegs fit in round holes to make the inspection happen with me. I told her she doesn't have to feel obligated to use me and that I could give her the names and numbers of some other inspectors in hopes that she could find one who would be able to meet her limited availability. She said "but you're the cheapest". ???????? The call ended as she had to rush off but then I realized we never actually spoke price. I don't even know what type or size of house she's buying. All we talked about in our first conversation was me letting her know what my schedule was because she wanted to do it this Sunday afternoon after 3pm. I don't work Sundays and I don't start any inspection later than 2:00pm. I guess her realtor told her what I charged on a previous inspection and this buyer is expecting the same. We'll see.

I never thought of myself as the cheapest by any means but if that is the way I'm being looked at, it's time to bump up prices. It's funny because yesterday, somebody contacted me about a builder's warranty inspection for a 4,000 sq ft house with 5 beds, 4.5 baths, and 3 HVAC zones. I gave my quote and the caller said he got a quote from an inspector who will do it for $350.00. Thank you, no.

Weird couple of days.

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People's perpsective when shopping for an HI are so varied. I like it when I quote a price and some says "Wow". It's about 50/50 which way they're surprised. I never know if they just talked to te $199 any house guy or the $495 condo guy.

It has been fairly busy though, and I'm not in as much of a mood to bargain with people as I have been over the past couple years. And aside from price it's also with time. I'm with you, Nick. I really hate to start jobs after 2PM.

I will only work a Sunday when things are really slow like at the start of the year but the past few weeks, Sunday has been my only day off. Through the first two weeks of March, I've already completed what I feel is a respectable number of inspections for an entire month.

I really snicker when somebody wants me to start an inspection at 5pm.

We have a $50 surcharge for Saturday inspections and a $100 surcharge for Sunday inspections. Every month we get someone willing to pay the extra.
Our last price increase was more than a year ago. You're right; it's time to review them and see if they need changing.
--Welmoed

Home Inspection Fee Calculator

Originally Posted by Lisa Endza

Home ... culator

No Thanks

I'll stick with this reputable, honest and professional persons calculator..
http://www.costofbusiness.com/

Why in the heck would you post an ad to undercut the owner of this site for a service. Not to mention an item that you never had until Brian offered this service /product years ago,[ to help cover the costs of maintaining this site] to the members and non-members of this site.

HMMM .Maybe it's time Brian hires someone to monitor and spam your site for every opportunity to sell his products to undercut what you sell.
No wait that won't work, he would have to pay you $400.00 for FREE advertizing

Using the price calculator Lisa posted, I should be charging $604.00 for the typical 1,200 sq ft Philly row homes I see regularly. At that quoted fee, I won't be seeing any of them because no buyer in their right mind around here will pay that much.

Thanks, but no thanks.

Originally Posted by Nick Ostrowski

Using the price calculator Lisa posted, I should be charging $604.00 for the typical 1,200 sq ft Philly row homes I see regularly. At that quoted fee, I won't be seeing any of them because no buyer in their right mind around here will pay that much.

Thanks, but no thanks.

Yea, In AZ, nickies certified eletes, that were Lic, and took his quiz yesterday, are advertizing inspections starting at $149.00 with free termite inspections. Then they have to pay google big bucks to advertize them on several links on the web.
Too bad nickies members believe nickos free BS and do not spend a couple bucks on Brians cost of doing business program. Nickies attempt at price fixing does not work in AZ..

You aren't using the calculator correctly then. You have to first set your rates in the shadowed Standard Rates box beneath it. Then run the calculator for each individual inspection.

I did put in my rates. And it gave me a price of $604.00. What should it say?

I think you used the defaults. You have to set it up first.

You have to setup the numbers in the Standard Rates box below it, depending on how you charge relative to your minimum fee, size, age, and distance. After you set those, go back up to the calculator and it will work fine.

So for a base price, think about what you would charge for a new, very small condo, next-door to your own home. Enter your base price in the Standard Rate box. You decide what your absolute minimum fee is for the easiest inspection on a new condo that you can walk to. Maybe that is only $125? I don't know. You decide.

Then think about how much you would charge extra if it was far away. For example, if it being 50 miles away would cause you to charge an extra $75 than put $1.50 in the Standard Rate box beneath. $75/50=$1.50/mile. If you charge an extra $1 for every mile it is away, set the mileage factor to $1/mile. You decide.

Then think about how much you would charge extra if it was 150 years old. For example, if it was built in 1862 perhaps you'd want to charge an extra $150. So set the age factor to $1/year.

Then think about the size factor. What if the house was 10,000 square feet. How much would you charge extra. Maybe 5 cents a square foot extra? The default is set to 4 cents. You decide and then set your size factor.

Once you set these 4 factors, go back up to the calculator and play with it to see if it is producing numbers you agree with. Once you are satisfied, you can have your secretary or spouse or office manager bid a job for you on the phone while you are out on an inspection, and he or she will bid it correctly, just as if you had calculated the fee in your own head intuitively. You essentially set the calculator up first, to think like you. Once you set it up, you'll never lose an easy inspection because you over bid it and you'll never end up on an under bid, old mansion, 2 hours away.

So set up the shadowed Standard Rates box first. Experiment with it and test it. Then for each inspection you are bidding, go back up to the calculator and enter the information for that particular property as well as how busy you are using the drop down menu. You have the option of picking Business is dead, Things are very slow, Things are slow, About average, I'm busy, I'm very busy, or I'm completely swamped. The busier you are the more it will charge. The slower business is for you that week, the less it will charge. So if you are already overbooked, the calculator tries to raise your fee structure to maximize profit margins. Then go back down to the bottom of the calculator and hit the Calculate Fee button. The calculator then determines the fee based on how far away the home is, the age of the home, the size of the home, and how busy you are using your thinking about how much extra you would charge if the home was farther away, older, larger, and how busy your calendar is. Once you set it up, the calculator will always work to maximize your profits on each inspection without losing many jobs to over bidding or losing money by under bidding.

The inspection fee calculator is open to every inspector, you need not be a member of InterNACHI to use it.

Not to sound desperate, but, if I have an hour of daylight to see the exterior of the home, you have an inspector. One hour before sunset.
The HI season is to short. My standard answer to when asked what time, I say 10 O'clock in the morning, always.
Then agree to whatever they come up with.

Our market has been very competitive for years. Real estate agents regularly discount their commissions here. I just received an email flyer from a PE offering to do most home inspections for a flat fee of $225. His hook is......why hire a HI and a structural engineer when you can get both for the price of one?

A few days ago, an agent called me saying that her favorite inspector had raised his base fee to $400 and her buyers were balking at paying that much. She was shopping around for alternative inspectors who were less expensive. I regularly have clients asking if I will do an inspection for less if they pay cash. In the same week, I had one lady ask me why I was so expensive and another ask why I was so cheap. It can be a funny biz.

Originally Posted by Lon Henderson

Our market has been very competitive for years. Real estate agents regularly discount their commissions here. I just received an email flyer from a PE offering to do most home inspections for a flat fee of $225. His hook is......why hire a HI and a structural engineer when you can get both for the price of one?

.

Talk about devaluing your education.

I will let the client come at 5 PM sometimes if they want. But I start my PM job at 2:00. Usual walkthrough time is 4:30 to 5:30. After 6PM, you are imposing on the sellers, unless it's a vacant house.

Originally Posted by John Kogel

unless it's a vacant house.

Are there any other kind these days?

Last week I actually did an inspection in an occupied house that wasn't a short sale of foreclosure.... it seemed odd. Kind of a flashback of sorts to what things used to be like.

Originally Posted by Matt Fellman

Are there any other kind these days?

Last week I actually did an inspection in an occupied house that wasn't a short sale of foreclosure.... it seemed odd. Kind of a flashback of sorts to what things used to be like.

I'm seeing about 40% occupied. Bring back the 100% vacant, it's a pain to schedule to the sellers and buyers times.

Originally Posted by Nick Ostrowski

Talk about devaluing your education.

Originally Posted by Lon Henderson
Our market has been very competitive for years. Real estate agents regularly discount their commissions here. I just received an email flyer from a PE offering to do most home inspections for a flat fee of $225. His hook is......why hire a HI and a structural engineer when you can get both for the price of one?


I would bet that the PE is NOT giving the buyer a professional certified evaluation with his pe stamp. Just another inspection report with a lot of cya language and many defer to a professional comments.

Originally Posted by Matt Fellman

Are there any other kind these days?

Last week I actually did an inspection in an occupied house that wasn't a short sale of foreclosure.... it seemed odd. Kind of a flashback of sorts to what things used to be like.

That was 2008 through 2010 for me. It got to the point that it was spooky walking into a house with furniture, but that changed in 2011. By the end of 2011, about 50% were occupied homes.

Hi, ALL &

* Back to the original question /point:

We should all raise 'em & we'll all be happier - correct ?

I see nothing wrong with charging more & more; let's raise our worth & value...


Cheers !

Originally Posted by Dan Harris

No Thanks

I'll stick with this reputable, honest and professional persons calculator..
http://www.costofbusiness.com/

Does anyone really think they should pay $99.00 for a paper on how much to charge for an inspection? It feels like an insult to home inspectors.

Originally Posted by Ken Amelin

Does anyone really think they should pay $99.00 for a paper on how much to charge for an inspection? It feels like an insult to home inspectors.

Ken,

That item is being offered by this site's (Inspection News) owner.

It's an interactive program where you enter data and see how much (or little) you're making based on the expenses related to running your HI business.

Forget raising prices, I just want to get paid! I lost three inspections in the last two weeks because I no longer take payment at closing. Where in the heck did this practice start anyway? Give a $200 to $800 unsecured loan to a total stranger that doesn't have a permanent address and can't afford to pay the inspection until he gets the loan. Try going to the grocery store and asking to pay for the steaks, milk, beer, etc. after your Uncle's will comes in! And for those who say just get there credit card for security, well how much do you think you can get from a maxed out card? And if you think you can just take them to court, well good luck, remember the part about "don't have a permanent address", you can't find them anymore.

In the last 14 years, I think I have waited for payment at closing a total of five times. I was paid every time. I will only do that with my trusted real estate agents.

I quit doing credit cards. To my astonishment, very few customers wanted to use their credit card. Credit cards were a net loser for me. During my three year contract, I only had a dozen customers use their cards (and not to mention, that the card processor hit me with an unauthorized charge.)

I average one bad check a year. Definitely, annoying, but not nearly the annoyance of dealing with a crummy card processor.

I have never agreed to accept payment at closing and I never will. Luckily it is not the norm around here. In 9+ years, I have only had it asked of me 5 times tops.

You can permit payment at closing with credit card guarantee option by using these free documents. So you want to pay at closing?

I would never defer payment until closing. It borders on a conflict of interest.
What happens if your inspection discovers major problems and the client walks?? How does that work? Is it in your best interest to hide problems so you will get paid???

---No ticky - No laundry ---

Originally Posted by Lisa Endza

You can permit payment at closing with credit card guarantee option by using these free documents. So you want to pay at closing?

Lisa you need to read what I posted a little closer. That credit card thing doesn't work!

payment due upon delivery of inspection report or completion of inspection, no exceptions.

With what I have on the schedule for the week, I'll end this month with 29 inspections which will be my best month ever. The mild winter we had is paying off.