Building Inspection Services
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 7,600 building inspection service providers in the US evaluate all aspects of building structure and component systems and prepare reports on the physical condition of a property. In addition to inspection services, firms may provide expert witness testimony in court cases. Some building inspectors, especially home inspectors, are self-employed and may work part time.
Liability for Errors
Building inspectors expose themselves to liability related to errors or omissions when performing an inspection.
Dependence on Referrals
Referrals from real estate agents are in important source of business for home inspectors.
Industry size & Structure
The average building inspection services provider operates out of a single location, employs about 3 workers, and generates $592,000 annually.
- The building inspection services industry consists of about 7,600 firms that employ about 23,400 workers and generate about $4.5 billion annually.
- The industry is fragmented; the top 50 companies account for about 25% of industry revenue.
- Large firms may offer a wide range of testing, inspection, and certification services, including building inspection services. National Field Representatives offers property inspection service throughout the US. National Property Inspections is a large franchise operator. Most firms operate regionally.
- Some building inspectors, especially home inspectors, are self-employed and may work part time.
Industry Forecast
Building Inspection Services Industry Growth
Recent Developments
Nov 18, 2024 - US Housing Market to Improve in 2025 and 2026
- After two years of high interest rates and home prices hindering home sales, the US housing market is expected to improve in 2025 and 2026, according to a November forecast by National Association of Realtors chief economist Lawrence Yun. Existing home sales are expected to rise 9% year-over-year in 2025 and then climb 13% in 2026. New home sales are forecast to increase by 11% in 2025 and 8% in 2026. Key demand drivers include a healthy labor market and population growth. The average 30-year fixed-rate mortgage over the past 52 weeks has ranged between 6.08% and 7.44%, according to Freddie Mac. Yun says he believes mortgage rates will be near the bottom end of that range in 2025 and 2026.
- Older Americans’ preference for aging in place is expected to tighten the US housing market over the next decade, according to a recent report by the Mortgage Bankers Association’s (MBA) Research Institute for Housing America (RIHA). The homeownership rate among Americans over 70 has been rising since 2015; this, combined with the size of the Baby Boom generation, is leading to larger numbers of existing homes staying off the market. The report does not expect an excess supply of existing homes to come to market over the next decade due to older Americans moving or dying. Aging homeowners staying in their homes longer could boost demand for new homes if the existing home market remains tight.
- Recent cuts to the benchmark rate by the Federal Reserve have yet to translate to lower mortgage rates for home buyers, according to The Wall Street Journal. A Fed rate cut of a quarter-percentage point in early November followed a half-point cut in September. However, for the week ended November 14, the average rate for a 30-year fixed-rate mortgage was 6.78%, down just 0.01 points from the prior week and only 0.66 points from a year earlier. Rather than being set by the Fed, mortgage rates are heavily affected by the 10-year Treasury yield. Treasuries tend to rise amid positive economic outlooks, and a rosy view of the current economy is keeping treasuries and mortgages high. Donald Trump's retaking of the White House pushed treasuries higher as some investors believed his tax-cutting plans would increase the deficit and contribute to inflation. Stubbornly high mortgage rates have stalled a rebound in home sales, which are a key demand driver for building inspection services.
- Home builder confidence in the single-family market increased in November, marking the third consecutive month of sentiment improvement, according to the National Association of Home Builders (NAHB). Home builder sentiment, as measured by the NAHB/Wells Fargo Housing Market Index (HMI), rose three points to 46 in November 2024. Any HMI reading over 50 indicates that more builders see conditions as good than poor. The NAHB said builders are generally upbeat about the election outcome, and future sales expectations improved in November. The HMI survey also showed that 31% of builders reduced home prices in November, and the average price reduction fell slightly to 5% from 6% in October.
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