Being a home inspector can mean flexible hours, autonomy, and good pay. But to reap those benefits, you need to have the right skills and qualifications to do the job well. This article will explain more about how to start a home inspection business and become a home inspector.
Do Home Inspectors Make Good Money?
There’s good news if you are learning how to become a home inspector. According to the Bureau of Labor Statistics, earnings for construction and building inspectors (which include home inspectors) are on the rise, with a 10% growth expected through 2026. Right now, the top 10% of home inspectors are making more than $100,520 annually, with the median home inspector earning $64,480. As regulators and the industry increase focus on home safety, the future looks bright for demand and steady work, so it’s a great time to learn how to become a home inspector, market yourself and grow your home inspection business.
Do You Need A Degree To Be A Home Inspector?
If you want to learn how to become a home inspector, a special degree is not necessary, nor is it required by any state to perform home inspections. You will need a high school diploma, A knowledge of architecture or engineering is a plus because these principles are used to evaluate the systems and structure of the home or building to determine if there are defects.
Steps to Start A Home Inspection Business
Get Proper Training and Certifications:
Doing research on your state’s licensing and certification requirements is critical if you want to know how to become a home inspector. There is no national standard and every state is different.
Many home inspector membership organizations will offer their own training courses, certifications, and Standards of Practice. Unless you are clear on what is required by your state, you may be making an investment that does not meet your state’s criteria for how to become a home inspector.
Thirty-five states require a home inspector to be licensed and certified. Many require taking the National Home Inspector Examination or belonging to a membership organization that meets certain minimum requirements.
Create A Home Inspection Business Plan
A business plan is a comprehensive outline of your business vision and purposes. It structures or organizes your business when you are starting a home inspector business. It contains information such as plans for your business services in detail, target market, financial plan, projected profits, funding sources, etc.
Get Home Inspector Insurance
Even the most experienced home inspector is not immune to making a mistake. Mistakes are more likely to happen in your first year of inspecting, so adequate insurance is extremely important. Safeguard your home inspection business from going under before it has a chance to take off with risk management.
New home inspectors should consider carrying errors and omissions insurance, and general liability insurance to reduce their risk. Beginning your home inspection business can be stressful, speaking with a home inspection insurance agency can help you decide what is the best option for you. EliteMGA will provide a free quote and breakdown of what insurance is the best fit for your needs.
Insurance is required by most states to protect consumers in the event that an error, omission, or unforeseen issue occurs.
Learn what insurance your state requires to become a home inspector. EliteMGA’s knowledgeable team will help you choose insurance that meets your state’s requirements as well as the needs of your business.
Get the Right Equipment & Tools for Home Inspections
With every profession, there are certain tools and equipment you need to operate effectively. Here is a list of the most important ones to become a home inspector:
- Microsoft Excel, Word for data entry
- Electrical testers
- Digital camera
- Inspection report software (Spectra)
- Safety equipment such as flashlights, boots, and more.
Market Your Business
Marketing is necessary for your registered business to attract new clients. Invest to create and design a good website for your home inspection business so that potential customers can know about your business, services, and contact you directly.
You can also hire a marketing agency to promote your business online with SEO, Ads, or Social Media. Distributing business cards, flyers, and brochures can enhance your brand presence in your local community. Customer word-of-mouth and realtor partnership are also an excellent way to get new leads and spread your business goodwill in the market.
What Are The Startup Costs For A Home Inspection Business?
Like most startup companies, a home inspection business requires new home inspectors to invest startup capital to get their business off the ground. That amount will vary depending on services, location, size of the company, type of schooling and licensing you pursue, equipment you obtain, how much you invest in marketing, insurance premiums, etc. According to US Small Business Administration, “Some may be able to launch with roughly $3,000 in startup costs, while others might come closer to $25,000.” Regardless of how much you spend, the key is taking the time to create a budget and plan accordingly so that your business can be successful. Some ideas of what your startup funds should go towards include:
- Testing and Licensing: Perhaps the most basic question you need to answer will be what services will you offer? You’ll want to be able to show your customers that you hold adequate training and credentials. If your budget is tight, you can always get the State-minimum certifications and increase your repertoire later with continuing education.
- Plan to spend between $500-$3,500 in this category
- Equipment and Organizational Tools: Every home inspector will need to have an arsenal of tools in order to perform a proper home inspection. In addition to the physical tools, having proper organizational tools will help keep track of invoices, schedules, billing, and pricing.
- Plan on spending between $1,100-$3,000 on both equipment and organizational software.
- Marketing: Marketing is an optional and flexible expense during the first year of your home inspection business. A lot of factors will determine your budget such as how competitive your market is and what campaigns you want to invest in. Marketing is an essential part of creating awareness and bringing in new customers. To be competitive in your industry, do not forget that you will probably need to invest in a website as well as digital marketing.
- Plan on a monthly budget of $100-$500+ on marketing initiatives.
- Membership Fees: Joining industry organizations can be a great selling point to customers. They are a great way to continue to grow and build your foundation of knowledge for your home inspection business. Most importantly, an association like InterNACHI has a database for certified home inspectors which will advertise you to local customers; this will help procure some of the most qualified leads you can get.
- Plan on spending between $200-$500 per year in this category
- Insurance Policies: Insurance is a key tool in protecting your home inspection business during its first year, and your customers will also want to make sure you are properly insured. Legal defense costs and damages could devastate an uninsured home inspector business. It is important to invest in insurance for home inspectors, including errors and omissions (E&O) insurance and general liability insurance coverages.
- E&O insurance can be tailored to your specific needs and services, annual deductible options range from $1,500 to $10,000 and liability limits range from $100,000 to exceed $1,000,000.
What a Home Inspector Should Expect in Their First Year?
Like any business, the first year can be challenging as you learn the ins and outs of becoming a home inspector.
During your first year in the home inspection business, you can expect to increase your knowledge as you experience new obstacles, learn how to resolve those challenges, and broaden your understanding of how the systems within a home work together.
What is a Home Inspector’s Job Description?
A home inspector is hired to evaluate residential properties to determine if the structure and systems of the home comply with regulations and are free from defects, damages, and hazards. Testing systems, creating reports of findings, and communicating the results with homeowners and other stakeholders is all part of the job. You should be knowledgeable, detail-oriented, thorough, and organized if you want to learn how to become a home inspector because your findings will help the homeowner make one of the biggest financial and personal decisions of their life.
How Many Home Inspections Can My Home Inspection Business Expect in the First Year?
During the first year of your new home inspection business, you may not get as many leads as you’d like. It is always an ongoing process to grow your customer base and get your name out in the industry as a reputable home inspection business. Established home inspectors can expect about 300 inspections per year. However, in your first year inspecting you should expect about 130 inspections.
The key is to stay patient, invest in marketing to get your name out there and encourage your customers to share their experience and refer your home inspection business. To build your future prospects, offer to stay in contact with the clients after the inspection, make connections with realtors, offer discounts, etc. Over time, the number of yearly inspections will grow.
At EliteMGA, we have been serving home inspectors for more than 15 years. We are the only insurance entity dedicated specifically to home inspectors and that has its own captive carrier, EliteRE. We can serve you better, faster, and at a lower cost. Contact our experienced team if you want to know how to become a home inspector and the insurance requirements in your state.
Note: This post was originally posted on February 2, 2023, and updated on October 18, 2023