April, 2007
Inspection News and Views from the American Society of Home Inspectors

Licensed vs. Unlicensed Home Inspectors


Recently, several ASHI chapter leaders responded to a state legislator sponsoring an inspector regulation bill. The leaders are aware that ASHI’s legislative policy statement states that any home inspector regulations must be “determined to be advisable for the protection of public health, safety and welfare.” They asked the legislator if there are data that indicate that home inspector licensing is required for consumer protection. They stated they did not hear testimony from consumers or consumer advocacy groups at the public hearing.

There is a good answer to the question posed by these chapter leaders. It is found in a May 2006 study on home inspector licensure, done by Belmont Technical College for the Education & Research Advisory Committee of the Ohio Real Estate Commission. The study, funded in part by real estate agent license fees, includes a survey of agents and home inspectors in three states with licensing and three states without. The study also surveyed home inspection consumers in Ohio (currently without licensing).

The states studied were:

Arizona, Texas, New Jersey – Licensed
Michigan, Ohio, Missouri – Unlicensed

The study’s statistical analysis reveals interesting conclusions.

Agents were asked “In general, how many inspection reports in 10 that you’ve seen in the past year do you consider inadequate?”

The study concluded, “There does not appear to be a significant difference in the number of reports rated inadequate by real estate agents between states with home inspection licensing and those without.”

Agents were also asked, “In transactions you’ve been involved with in the past year, how many buyers in 10 later discovered problems with their property despite having had a home inspection?”

The study concluded, “There does not appear to be a difference between licensing and non-licensing states in real estate agents’ ratings of the number of buyers in 10 who report problems.”

Other questions to agents produced similar conclusions, indicating no difference on the following rankings:

  • Agents’ ranking of the accuracy of the home inspection report

  • Agents’ ranking of the inspectors’ knowledge of building construction

  • Agents’ ranking of the professionalism of the inspection report

  • Agents’ ranking of the satisfaction of the home inspection client
The survey of home inspectors produced results showing no significant difference between licensed inspectors and non-licensed inspectors in the following categories:

  • Percentage of home inspectors who indicated home inspection as their primary occupation

  • Number of inspections performed in a year

  • Number of hours spent on a typical home inspection

  • Number of hours of continuing education completed in the past year

  • Percentage of inspectors who carry errors & omissions insurance
Ohio homeowners’ answers were compared to the real estate agent data in licensed states only and revealed no significant difference in the following questions:

  • Rating of home inspector’s knowledge of building construction

  • Rating of professionalism of home inspectors’ reports
The Ohio survey summary states:

“The raw survey data show little overall difference between states with home inspection licensing and those without. The intention of this statistical analysis was to determine if the small difference that may exist is significant for comparable numeric data. In virtually every case, the difference was not significant.”

The Ohio Feasibility Study Conclusion:

Ironically and perhaps sadly, at least for those home inspectors in Ohio who prefer to avoid licensing, or if licensed, have strong licensing requirements, the authors of the study conclude, “a full home inspection licensing program on par with the real estate licensing program is necessary.”

The conclusion is based on other factors such as “national momentum toward home inspection regulation” even though they state, “momentum toward regulation is not justification for regulation in Ohio, but by now is too great to be ignored.”    

The full study is at http://com.state.oh.us/real/documents/2005.0001FinalPaper.pdf

Given these conclusions, ASHI members are encouraged to study carefully all proposals for inspector regulation and to follow the example of the ASHI chapter leaders mentioned above. The chapter leaders requested that a Sunrise Review be performed by the legislature to determine whether or not home inspector licensing is needed to protect the consumer. Requesting a Sunrise Review (study of need for regulation) is a tactic that can help ASHI members control or change the implementation of inspector regulations.

For assistance on legislative issues, go to the ASHI Legislative Action Center at  http://capwiz.com/ashi/home/ or contact Bob Kociolek, ASHI director of chapter relations and legislative affairs, by phone  at 847-954-3177 for e-mail, bobk@ashi.org.