Sometimes they go very cheaply here but that's usually a bundle. Like you do the title survey, flood cert, and new description and charge $300 each or something
Ron Lang, post: 403745, member: 6445 wrote: Because people hire a part time college student to do the work and don't charge what the job is worth. Period. No one say gouge people, but seems to me that if a EC is a necessity in the area the one certifying the EC should make a reasonable profit for the liability. In my area the lender can hire some company 1000 miles away to determine if the house is in a flood zone and they charge $350 to look at a map an then request a EC it's close. But if it works for you who am I to judge.
I do not have the faith in a part time college student to do the EC correctly, and $200.00 is not enough to cover the insurance if he makes a mistake, also I have never felt the need or understood why I have to lower my price to match another surveyor.
I charge on a per trip basis. An existing structure is usually 1 trip. A mobile home move in is usually two trips the first to set a BM and the second to collect elevations for the certificate once the mobile home is blocked, leveled and tied down.
For new construction it is always at least two and often three trips. The middle trip is for the contractor's piece of mind. We will check the top of forms before concrete is poured.
My fee for the one trip is way more than $200 and goes up based on distance from my office.
Did you say they are setting a benchmark for new construction as well for that price/?? Talk about your liability issues! I'm sure most of the FEMA mills that exist have a "contractor" that they pay a flat fee to and they just go out with GPS and data package... paint a dot in the road and shoot it. call it a benchmark. take pics.. maybe measure the house if they can't get the info online at the county appraiser site. MAYBE use a laser level to transfer from the "benchmark" to the floor elevation. or just eye ball it! whatever, who cares? if anyone calls to question it they just ignore it and keep running. So for 200 bucks, they probably paid the 'contractor' 50. have some cheap office help put it together for $20 and sign it. so that's about $130 for maybe 5 minutes of their time.
12 of those an hour and they are pocketing $1,560 per hour.
I know this is how they run because I had a buddy (also was a party chief) call me one day asking for a copy of a FEMA I had done so that he could save the 20 minutes he usually spent on them, not to mention the drive to the island and the $6 toll!!!
I talked to him long enough to get the gist of what he was up to before I sent him packing.
This reminds me of a conversation a few decades back in Missouri. All participants got nailed for price fixing...
Scott Ellis, post: 403886, member: 7154 wrote: I do not have the faith in a part time college student to do the EC correctly, and $200.00 is not enough to cover the insurance if he makes a mistake, also I have never felt the need or understood why I have to lower my price to match another surveyor.
I have complete faith in all of my employees, or I wouldn't put my stamp on it. I also have checks and balances to ensure the work is correct to the best of our ability. But all of us are human and can make mistakes. Let's be realistic here. Most of these ECs are only used to get a quote for flood insurance. That's it. What's your real liability if you actually make a mistake of a few tenths? Insurance company rounds your numbers anyways. My QA process would catch obvious errors that would impact the EC, so I'm very confident in my work product, even if I only charge $250. If something doesn't look right, I send my guy back to redo it. It happens, but rarely.
For new mobile home installs (which I charge $500), I always add 0.1' to the benchmark nail to give the installer a little wiggle room. Also, for mobile homes around here, the installed elevation is based on the lowest part of the frame for the permitting process. Once it's installed, the insurance goes off the floor elevation, which is ~18" higher than the frame. Again, very low risk.
So I really don't understand all the comments about how the price isn't worth the insurance if you make a mistake. Are you saying that $700 is worth getting sued, but $250 isn't? Personally, I treat each job with the same amount of care no matter what I charge the client. Hundreds of thousands of people lost their homes around here due to flooding, so I'm not all that concerned about maximizing my profit on ECs. To that homeowner that just lost everything, $250-$500 might as well be $2,500-$5,000. I turn a profit, albeit small, and they get a quality product. Sounds like a win-win to me. Once again, the market in this area set the price for typical residential ECs, not me. Sounds like the market price is higher in other areas. Good for you.
andrewm, post: 403702, member: 10888 wrote: Going rate around here is $250. I know one firm that does them for $225. Everyone uses GPS. Some use VRS while others run a 1-hr static. Only way it works for this price is a one-man field tech and have an efficient process in the office. Volume is the key.
"Volume is the key."
Really?! Is that what they teach in Business 101? With all due respect, that is one of the stupidest concepts I have ever heard. It may be true for used cars, but that is no way to value professional services.
We start at $1,200 for existing clients and go up from there. The average is probably $1,800. That's what they are worth.
We just did 10 all in one apartment complex for $8K and felt guilty that we charged so little.
andrewm, post: 404034, member: 10888 wrote: I have complete faith in all of my employees, or I wouldn't put my stamp on it. I also have checks and balances to ensure the work is correct to the best of our ability. But all of us are human and can make mistakes. Let's be realistic here. Most of these ECs are only used to get a quote for flood insurance. That's it. What's your real liability if you actually make a mistake of a few tenths? Insurance company rounds your numbers anyways. My QA process would catch obvious errors that would impact the EC, so I'm very confident in my work product, even if I only charge $250. If something doesn't look right, I send my guy back to redo it. It happens, but rarely.
For new mobile home installs (which I charge $500), I always add 0.1' to the benchmark nail to give the installer a little wiggle room. Also, for mobile homes around here, the installed elevation is based on the lowest part of the frame for the permitting process. Once it's installed, the insurance goes off the floor elevation, which is ~18" higher than the frame. Again, very low risk.
So I really don't understand all the comments about how the price isn't worth the insurance if you make a mistake. Are you saying that $700 is worth getting sued, but $250 isn't? Personally, I treat each job with the same amount of care no matter what I charge the client. Hundreds of thousands of people lost their homes around here due to flooding, so I'm not all that concerned about maximizing my profit on ECs. To that homeowner that just lost everything, $250-$500 might as well be $2,500-$5,000. I turn a profit, albeit small, and they get a quality product. Sounds like a win-win to me. Once again, the market in this area set the price for typical residential ECs, not me. Sounds like the market price is higher in other areas. Good for you.
I do not believe you fully understand what an Elevation Certificate is used for and how important being closer than few tenths really is, if you have them higher than the FEMA base elevation is suppose to be, and the house floods and the owner files a claim, the insurance company may send someone out to check your work. If they find the house lower, then the insurance company will not pay the claim, and the homeowner will sue you for having them at the wrong elevation. If you have them lower than the base flood they will have to pay a higher flood rate, years later they may find out you have them lower than they should be and they will sue you for the extra money they had to pay the insurance company. Also ECs are used for building permits. If they build a house based on a benchmark you set and you are off a few tenths, that can bite you as well.
You should not add 0.1' to your benchmark you should be taking off a 0.1' so they build they house higher not lower.
I agree with helping people out after they lost everything, I wish the roofers and others trades would do so, most dont.
I like to be able to invoice a certain when I am in the field, if i can do 3 jobs instead of 6 that day, it allows me to spend more time on each job. I am not saying $700.00 is worth getting sued over, but that extra $450.00 will cover the insurance I carry and allows me to have a profit.
Scott Ellis, post: 404045, member: 7154 wrote: I do not believe you fully understand what an Elevation Certificate is used for and how important being closer than few tenths really is, if you have them higher than the FEMA base elevation is suppose to be, and the house floods and the owner files a claim, the insurance company may send someone out to check your work. If they find the house lower, then the insurance company will not pay the claim, and the homeowner will sue you for having them at the wrong elevation. If you have them lower than the base flood they will have to pay a higher flood rate, years later they may find out you have them lower than they should be and they will sue you for the extra money they had to pay the insurance company. Also ECs are used for building permits. If they build a house based on a benchmark you set and you are off a few tenths, that can bite you as well.
You should not add 0.1' to your benchmark you should be taking off a 0.1' so they build they house higher not lower.
I agree with helping people out after they lost everything, I wish the roofers and others trades would do so, most dont.
I like to be able to invoice a certain when I am in the field, if i can do 3 jobs instead of 6 that day, it allows me to spend more time on each job. I am not saying $700.00 is worth getting sued over, but that extra $450.00 will cover the insurance I carry and allows me to have a profit.
Due to the subsidence rate here, I put a disclaimer that the EC is only valid for 1 year. Trust me, I absolutely know how important it is to get these correct. For a flooded house close to the BFE, 0.1' can mean the difference between having to elevate or not after getting a substantial damage determination. The only way to get these more accurate is longer / multiple GPS observations or a very very long level from a valid benchmark. Valid benchmarks are few and far between in this area.
I didn't mean add 0.1' to the benchmark, I meant put the nail 0.1' higher, so the mobile home is installed higher. If the BFE is 30.0', I'll set the nail at 30.1'.
I'm certainly not defending the $250 price tag. I made the business decision to do these. I do these to help the community recover and turn a small profit. Because of the shear volume of ECs done in this area, the market set the price. No other aspect of my business is like this. At some point, I may decide ECs aren't worth $250 to me.
Jim in AZ, post: 404040, member: 249 wrote: "Volume is the key."
Really?! Is that what they teach in Business 101? With all due respect, that is one of the stupidest concepts I have ever heard. It may be true for used cars, but that is no way to value professional services.
We start at $1,200 for existing clients and go up from there. The average is probably $1,800. That's what they are worth.
We just did 10 all in one apartment complex for $8K and felt guilty that we charged so little.
How long does it take you to complete an EC for this house? Single-story, ~2000 sq ft, concrete slab, 1 central AC unit, no garage, no basement, no crawlspace. This is the typical house in our area.
thebionicman, post: 404019, member: 8136 wrote: This reminds me of a conversation a few decades back in Missouri. All participants got nailed for price fixing...
It was in Arkansas and it was not the same thing that is occuring here...
andrewm, post: 404057, member: 10888 wrote: How long does it take you to complete an EC for this house? Single-story, ~2000 sq ft, concrete slab, 1 central AC unit, no garage, no basement, no crawlspace. This is the typical house in our area.
3-4 hrs including travel is probably a good average...
Jim in AZ, post: 404083, member: 249 wrote: It was in Arkansas and it was not the same thing that is occuring here...
I am a bit familiar with Arkansas, Florida and Missouri cases. The Missouri case was late 80s or so. Several Surveyors were overheard discussing prices in a bar. The event became fodder for classes and seminars for several years.
Don't get me wrong, I HATE having to explain why my number is 4 times another guy. There shouldn't be that must disparity in similar jobs in the same town...
Jim in AZ, post: 404092, member: 249 wrote: 3-4 hrs including travel is probably a good average...
That's about the same as me. 3 hrs for the tech, 1 for me. But like today, he did 4 in 8 hours. Tomorrow he will do 5-6 in 8 hours, as they are all in the same neighborhood. That's what I meant about volume. If I can schedule multiple ones in the same day in close proximity, then the drive time is significantly reduced and $250 is much more profitable. It's the one per day 45 minutes from the office that is marginal at best.
Because of the shear number of structures in a flood zone around here (90% of my Parish flooded in August), ECs are unlike any other typical professional service. It's almost like calling a plumber unfortunately. I don't like it, but it is what it is. If you want to do them, it's ~$250. Otherwise, focus on other services.
andrewm, post: 404099, member: 10888 wrote: That's about the same as me. 3 hrs for the tech, 1 for me. But like today, he did 4 in 8 hours. Tomorrow he will do 5-6 in 8 hours, as they are all in the same neighborhood. That's what I meant about volume. If I can schedule multiple ones in the same day in close proximity, then the drive time is significantly reduced and $250 is much more profitable. It's the one per day 45 minutes from the office that is marginal at best.
Because of the shear number of structures in a flood zone around here (90% of my Parish flooded in August), ECs are unlike any other typical professional service. It's almost like calling a plumber unfortunately. I don't like it, but it is what it is. If you want to do them, it's ~$250. Otherwise, focus on other services.
Andrew maybe the going rate in Baton Rouge is $200 - $250, but that's awfully low. I'm not going to get into specifics, but I know someone who works in an area that was affected by the flooding that has more of them than he can handle and has been charging $350 - and THAT'S a concession to help people out, his usual rate is $550.
Lee D, post: 404106, member: 7971 wrote: Andrew maybe the going rate in Baton Rouge is $200 - $250, but that's awfully low. I'm not going to get into specifics, but I know someone who works in an area that was affected by the flooding that has more of them than he can handle and has been charging $350 - and THAT'S a concession to help people out, his usual rate is $550.
The price range I've seen in the Baton Rouge area is $225 - $350, with $250 being about the median. Once this flood demand slacks off, I certainly won't be charging $250. Doing one or two a week at that price isn't worth it.
andrewm, post: 404110, member: 10888 wrote: The price range I've seen in the Baton Rouge area is $225 - $350, with $250 being about the median. Once this flood demand slacks off, I certainly won't be charging $250. Doing one or two a week at that price isn't worth it.
So when demand is up the price goes down? I'm not a business expert, but no one with any business or economic acumen would support that concept. We need to be charging what things are worth, and if there is a high demand they are worth more than when there is a low demand - Economics 101.
Jim in AZ, post: 404168, member: 249 wrote: So when demand is up the price goes down? I'm not a business expert, but no one with any business or economic acumen would support that concept. We need to be charging what things are worth, and if there is a high demand they are worth more than when there is a low demand - Economics 101.
I know right. Never said it made any sense whatsoever. But for me personally, I'm able to do them for this price as long as I can schedule several in a day. When I can't, I won't be competing with the $250 guys any longer.
I hear what you guys are saying. But for my small firm, looking to generate extra revenue to help offset my business flood losses, performing $250 ECs along with many other small firms made fiscal sense. At the point it stops making sense, I'll raise my price to a point that works for one-off jobs for me. That won't change the price for the other small firms that specialize in low-cost ECs. But it will allow me to continue to be profitable for single ECs.
For my business, this is a very unique situation due to the flood. I do agree with all of you that we should charge clients what our services are worth. 99.99% I set that value. In this case, the market set the value and I could choose to do lots of them or few.
Since Sept 1 of this year, we have done about 125 ECs. That extra revenue has been sorely needed to offset our flood losses. We did not have flood insurance, so furniture and fixtures were a loss. Fortunately our inland marine policy covered our computers and electronics. I've lived here my entire life and like my landlord never fathomed the office location would ever flood, much less to this extent. Hard lesson learned.
I initially posted in this thread to explain how sub-$300 ECs are possible. Then I felt I had to defend my ethical and business decision to do these at this price. It's real easy to second guess and armchair quarterback other's decisions, but I'm 100% confident I'm providing quality, accurate ECs at the market price. I bet many of you in my position would have done the same.
Jim in AZ, post: 404168, member: 249 wrote: So when demand is up the price goes down? I'm not a business expert, but no one with any business or economic acumen would support that concept. We need to be charging what things are worth, and if there is a high demand they are worth more than when there is a low demand - Economics 101.
Yeah, when people are affected by natural disasters we tend to help each other out... that's how we roll down here:cool: