If you’re thinking of becoming a home inspector, it’s smart to do your homework. Is this a field experiencing growth, or will you have to claw your way to the top of an over-crowded field? Is it worth the time and effort to get licensed to inspect homes in your state, or would you be better served to stick to your current job for a few more years?
Any career change is uncertain, but understanding market conditions and what you’ll need to invest in your success will help you make the right decision. Here’s what you need to know about the current demand for home inspectors in the United States.
Home sales are on the rise
Most home inspections are tied to real estate transactions — specifically, a home buyer will hire a home inspector as part of their due diligence before the sale goes through. A thorough home inspection alerts buyers to major problems with a home that could cost them money. This information empowers the buyer to negotiate a better price on the property or to walk away from a contingency offer if the property is significantly worse than expected.
Some home inspections are also done on behalf of home sellers, usually to help them focus on the most necessary repairs before putting their house on the market. A seller’s inspection report can be a value marketing tool for real estate agents and contribute to smoother transactions when offers roll in.
With so many inspections tied directly to home sales, one of the biggest drivers for demand is the housing market itself. According to the National Association of Realtors, home sales in the year 2020 topped 5.64 million units — meaning that well over 5 million residential units were sold during the year of the pandemic.
This number is great news for home inspectors for several reasons. First, it’s the highest number of annual sales since 2006, which was the boom times before the housing bubble burst and led to the Great Recession. The market was hot then, and it’s heating up again now.
Second, those sales numbers would have been even stronger if not for the pandemic, which practically shut down real estate and every other industry when lockdowns and social distancing restrictions took hold from March through May. In fact, National Association of Realtors Chief Economist Lawrence Yun suggests that home sales could top 8 million with enough supply — that’s how many people are looking to relocate as the world opens up again.
The upshot for home inspectors? People aren’t giving up on finding their dream homes any time soon, and all those real estate transactions represent an enormous business opportunity for qualified home inspectors — especially ones who can move quickly to meet rising demand in hot markets.
Trends support continued growth
It’s not just a once-in-a-lifetime pandemic surge causing a run on real estate right now. Several other economic trends are also influencing the market and pointing toward continued growth in home sales.
First, mortgage rates hit historic lows during the pandemic, and many economists believe they will remain favorable for home buyers. While economists like Lawrence Yun expect rates to increase in 2021, most analysts expect mortgage rates to stay in the 3% range for the foreseeable future. This is great news for buyers, who can make their money go much farther with low-interest rates. The bottom line here is that low rates encourage home buyers to act.
Second, many buyers have decided to leave crowded cities for more space in the suburbs and exurbs, reversing a trend towards city living that had been happening for several years. This shift in preferences means that people who once could not afford to buy may now find they can enter the market in less expensive small towns — and that puts more buyers in play to drive sales. If you’re an inspector in a smaller market, this is great news for your business.
Finally, new construction may lag for quite some time, thanks to how the pandemic has upended the supply chain. Building materials like lumber are incredibly expensive right now, and some furniture and appliances are backlogged by manufacturers, forcing construction companies to wait as the economy ramps back up. In the meantime, buyers are turning to existing homes — all of which should be inspected before closing the sale.
Specific predictions for the inspection industry
The Bureau of Labor Statistics tracks trends for just about every career you can think of, including the construction industry. They predict 3% growth for inspectors of all types — including construction, building, and home inspectors — with an additional 3,900 jobs to be added over the next decade. This matches the growth rate expected across the economy, making home inspection a fairly safe bet for anyone looking to make it in this rewarding industry.
Getting started as a home inspector
Given the current real estate, labor, and economic trends, there’s plenty of reason to think that demand for home inspectors will remain high for some time. If you’re ready to start your career as a home inspector, HomeGauge is here to support you. Check out our Learning Center for advice on everything from getting referrals from real estate agents to how much to charge for your services.
We also offer everything you need to launch your home inspection business, including dedicated home inspection software, customizable inspection reports, and business websites that give you the professional presence you need to impress your clients. Contact us today to learn more about how we can help you succeed.