A building and pest inspection business in Australia typically sells for 2x to 4x its normalised EBITDA. A well-run three-inspector operation generating $200,000 in EBITDA would typically fetch $400,000 to $800,000 at sale, depending on how the business is structured and how reliant it is on the owner personally. In Western Australia, where the property market has kept inspectors busy through the mid-2020s, demand for quality inspection businesses has held up — but buyers still apply a hard lens to key person risk and referral concentration before they commit to a price.
If you’re thinking about selling, here’s how the numbers work.
How Building Inspection Businesses Generate Revenue
Most building inspection businesses earn revenue one of two ways: per-inspection fees charged to property buyers, or commercial and strata inspection contracts. Residential pre-purchase work is by far the most common, and it’s the most volatile — it moves directly with property transaction volumes.
A standard building and pest inspection in Australia runs from $400 to $900, depending on property size, state, and whether you offer timber pest inspection as a combined service or separately. In a city like Perth, where properties have generally been larger and the market busier, inspectors often run 4 to 5 jobs per day. An experienced inspector working four days a week at an average fee of $600 generates around $500,000 in annual revenue.
Gross margins are high — 65 to 75 percent before labour — because the main costs are fuel, software, and professional indemnity insurance. EBITDA margins for established multi-inspector businesses tend to land between 20 and 35 percent. A $1 million revenue business with three employed inspectors and an owner-manager should generate $200,000 to $350,000 in EBITDA, which is the figure a buyer will start with.
The businesses that attract the best multiples have diversified beyond residential pre-purchase work. Commercial inspections, pre-lease reports, building condition assessments for body corporates, and insurance claims inspections all provide revenue that doesn’t stop when the property market cools. If more than 80 percent of your revenue is residential pre-purchase, expect buyers to factor in that cyclicality when they’re deciding what multiple to pay.
EBITDA Multiples for Building Inspection Businesses
The multiple a buyer pays depends heavily on the size and structure of the business, not just the earnings.
A single-inspector owner-operator — the most common type — typically commands 1.5x to 2.5x normalised EBITDA, or what’s sometimes called SDE (seller’s discretionary earnings), because the business is essentially being valued as a job. If the owner does every inspection personally, the buyer knows they’re starting from scratch on building a real business. The price reflects that.
A business with two or more employed inspectors, a systematic booking process, and recurring commercial clients starts to attract 2.5x to 3.5x EBITDA. Buyers see it as a transferable operation, not a self-employed person with a van and a software subscription.
The top of the market — 3.5x to 5x EBITDA — is reserved for businesses with five or more inspectors, strong brand presence in their region, diversified revenue streams, and management that doesn’t walk out the door on settlement day. In this sector, that’s genuinely rare, which is why the premium exists.
Franchise operations (Inspect My Home, Veda Inspections, and similar groups) tend to trade at discounts compared to independent businesses of the same size, because the buyer inherits a franchise agreement with fees and restrictions. The exception is franchise territories with high brand recognition and full book of business — those can trade on par with independent operations.
What Drives Value in a Building Inspection Business
Three things move the multiple more than anything else in this sector.
Referral network quality. The lifeblood of a building inspection business is referrals from real estate agents, conveyancers, and mortgage brokers. A business where referrals come from twenty different sources — spread across multiple agencies and finance brokers — is far more valuable than one where 70 percent of work flows from two real estate agents. Buyers look at referral concentration first. I saw one owner — solid business, three inspectors, good margins — who had the majority of his bookings coming from a single Harcourts office. When that office principal retired, his revenue fell 40 percent in six months. The business sold for considerably less than he’d expected.
Inspector qualifications and licensing. In Western Australia, building inspectors must hold a builder’s registration or equivalent licence. Queensland, Victoria, and NSW all have their own licensing requirements. If your value rests on your personal licence and that licence can’t be transferred to a buyer or their staff, you’ve got a deal-stopper. Buyers need to either hold the relevant licence themselves or employ someone who does before they can operate the business. Sorting this before you go to market is essential.
Systemised operations. Inspection businesses that run on proper job management software, have documented processes for quoting, inspection, and report delivery, and where any trained inspector could step in and maintain quality — those sell. The ones where report formats change depending on who does the job, quoting is done ad hoc, and the owner’s mobile is the main contact number — those struggle. Systems aren’t glamorous (which is why most owners don’t bother until they want to sell), but they’re what allow a buyer to see continuity.
What Reduces Value
The most common value-killers in this sector:
Owner-dependency. If your name is on the business, your face is on the website, and your personal relationships are the reason clients book with you — that’s key person risk, and buyers price it accordingly. The fix is usually time: you need at least 12 months of demonstrated revenue with another inspector carrying a significant portion of the workload before a buyer will give you a decent multiple.
Single-service concentration. Building inspection only, with no pest inspection capability, means you’re leaving volume on the table and limiting buyer interest. Combined building and pest is the market standard. If you’ve not added pest inspection, most buyers will either require a price reduction to account for the licence acquisition cost, or walk away.
Cyclical dependence on the property market. An inspection business that soared through 2021–2024 while the property market ran hot will need to show a buyer that the earnings aren’t simply a beneficiary of an unusual market period. Normalised earnings need to account for a more moderate transaction environment. Buyers are not going to pay top dollar for what they see as peak-cycle earnings.
Buyer Types
Buyers of building inspection businesses typically fall into a few categories.
Individual buyers who want to buy a job — typically paying 1.5x to 2.5x EBITDA and expecting to run inspections themselves. These are the most common buyers for smaller businesses.
Strategic buyers — other inspection businesses, often looking to expand into a new suburb, territory, or state. They’re paying for the referral network, the client database, and the ability to deploy their own inspectors immediately. These buyers often pay at the higher end of the range.
Franchise groups rolling up independent operators. Some national inspection brands have been actively acquiring independents in recent years, particularly in strong property markets. They typically pay 2x to 3.5x EBITDA, but the deal structure often includes an earn-out tied to revenue retention.
Private equity is unlikely to be interested unless you’re running $500,000+ in EBITDA with genuine management depth. Below that, the investment is too small and the key person risk too high for most PE mandates.
How to Prepare Your Inspection Business for Sale
If you’re considering selling in the next one to three years, there are three things worth focusing on now.
Reduce owner-dependency. Start having inspectors deal directly with booking agents, answer queries, and manage client relationships. Get your face off the front of the referral relationship.
Diversify referral sources. Track where every booking comes from. If one source accounts for more than 20 percent of revenue, start deliberately building alternatives. This takes 12 to 18 months to show up properly in the financials.
Clean up the financials. Make sure your EBITDA is documented and defensible. If you’ve been running personal expenses through the business (as most owner-operators do), document them properly as add-backs. Buyers and their accountants will scrutinise the numbers — the better your records, the smoother the process.
For more on preparing any trade or service business for sale, see our guide to selling a trade business. If you want to understand how your multiple compares across industries, our EBITDA multiples by industry guide covers the data in more detail.
Building inspection businesses are good businesses. Solid margins, low capital requirements, consistent demand, and a property market that shows no sign of making inspections optional. The challenge at sale — and it’s the challenge for almost every owner-operated service business — is separating the business value from the person running it. Do that work before you go to market, and you’ll get a much better outcome than the owner who lists first and figures it out under the pressure of a negotiation.
If you’d like a private valuation of your inspection business, get in touch or try our business valuation calculator for a quick ballpark.