All things considered, a home inspection is not expensive at all, especially when we consider the alternative. Let's say that instead of hiring a generalist home inspector, one were to hire experts from other industries to inspect the components with which they are expert.

Using San Diego prices for a single-family residence with 1,750 square feet, 3 br/2 ba, a 2-car garage, and a fireplace, in average condition, built in 1980, in an average neighborhood, and selling for an average $400,000. Here's the house:

Here's the costs:

Russel Ray, home insepctor - $499

Other individual service professionals checking what Russel Ray, home inspector, checks - $2,040

1. electrician (panel, outlets, lights) - $150
2. plumber (disposal; water heater; sinks; bathtubs; showers; water, sewer, and gas lines) - $250
3. roofing contractor - $85
4. chimney sweep - $80
5. landscaper - $50
6. soils engineer/geologist - $500
7. structural engineer - $500
8. door/window installer - $50
9. garage door installer - $50
10. kitchen appliances installation/repair professional - $75
11. heating and cooling technician - $100
12. drywaller - $50
13. exterior siding professional - $100

Now I will grant you that the 13 experts in looking at only one system or component for which they are responsible are highly likely to find more than lowly Russel Ray, home inspector, did. What generally happens, though, is that for $499, Russel Ray, home inspector, says you need a plumber to come out and evaluate the poor drainage that seems to be localized to the master bathroom sinks, shower, and bathtub; and an electrician to replace the Zinsco electric panel.

Both of those service professionals will come out with an $85 service charge. If they do the repairs, they will waive the $85 service charge. The repairs come to a total of $3,000, which the seller agreed to pay for since those were the only two problems, albeit significant ones.

So:

1. for a total of $499 to Russel Ray, home inspector, the Client saved $3,000 in repairs, or
2. for a total of $2,040 to the other service professionals, the Client saved $3,000 in repairs

Which would you prefer?

The problem here lies more in the fact that the home inspection industry is only about 35 years old, and in some areas of the country the number of homes that get home inspections is still down around 15-20%. Here in San Diego we're only at about 80%, and that's high; the last statistic I read had a nationwide average of about 65%.

The other problem is that Realtors for some strange reason won't call home inspectors to get a firm price, or they won't tell the Client to call the home inspector for a firm price. We must be the only industry where someone else tries to set our prices for us.

I sometimes get a call from a prospective Client inquiring about the cost of a home inspection on that average home. When I tell them that it's $499, they exclaim,

"My Realtor said it would only be a couple hundred dollars."

Why would a Realtor say that? Just because the last inspection two years ago did, indeed, cost $200? Have we no right to raise the prices for our own businesses to account for overhead like gas and E&O insurance?

Or

"Wow. My Realtor said it wouldn't cost very much."

Why would a Realtor say that? To a Realtor here making 3% commission on that average $400,000 home ($12,000), yes, $499 might not be very much. To my prospective Client, though, now I have to spend 30 minutes trying to convince him that I'm worth $499 since my Realtor, whom he trusts, said it would only cost "a couple hundred dollars" or "not very much." I don't mind selling myself, but I do mind having to sell myself when someone else has already set me up for 50% failure.

If Realtors want to tell Clients the cost of the home inspector's services, say something like this:

"It can vary based on square feet, age, and travel time. Let's call him right now and get a firm quote."

Or

"...call him and get a firm quote."

Or

"...I can call him later and get a firm quote for you."

My preference is "Call him and get a firm quote." Let me sell my own services for my own company.

Thank you for reading.

The above was posted as a comment in a friend's blog, but I thought it was important enough to blog it myself. I hope that's allowed.

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