Home Services Business Valuation
29 valuation methods · 43 industries · Results in under 10 minutes
In short
A home services business is usually valued on seller's discretionary earnings: EBITDA plus the owner's pay. VA values service agreements and maintenance plans as their own layer, at a higher multiple than one-off jobs, and lowers the multiple on work for new construction.
Who this is for
Owners of HVAC, plumbing, electrical and other home services businesses preparing to sell, bring in a partner or plan succession, and buyers, including groups that combine companies across a region, who need agreement revenue separated from one-off jobs.
How is a home services business valued?
VA values an owner-run home services business on seller's discretionary earnings: EBITDA plus the owner's pay, because a buyer replaces the owner. Service agreements and maintenance plans are valued as their own layer, at a higher multiple than one-off work, and that multiple rises with the share of customers who renew. Repair, replacement and install work is valued at a lower multiple that rises with the company's size and falls as work for new construction takes a larger share. Comparable companies, precedent transactions and a discounted cash flow check the result, and an asset floor keeps it above what the company's own assets would recover. This tool is informational only. Output is driven by your inputs and does not constitute a formal appraisal or certified valuation.
What drives the value of a home services business?
- Service agreements and maintenance plans, and the share of customers who renew them
- The split between repair and replacement work in existing homes and installs in new construction
- Technicians: their licenses, how long they stay, and whether the company runs when the owner is away
- Route density, so technicians spend more of the day working than driving
- Online reviews, and the share of work that comes from repeat customers and referrals
- The size of the company, since larger service businesses are valued at higher multiples
What lowers the value of a home services business?
- Few maintenance agreements, or customers who do not renew them
- A large share of installs in new homes, which follow the building cycle
- Technicians who could leave, or an owner who runs every job
- Leads that depend on paid advertising rather than repeat customers
How much is a home services business worth? A worked example
A home services company with maintenance plans
Take a home services company with $3 M of revenue, $350 K of EBITDA and $130 K of owner pay: $480 K of seller's discretionary earnings. Maintenance plans bring in 30% of revenue, 80% of those customers renew each year, and 10% of revenue is installs in new construction. The trades model values the plan share of earnings at 4.6× and the rest at 2.9×, about $1.64 M before debt, or 3.4× the owner's earnings. Without the plans, the same earnings come to about $1.39 M.
Illustrative figures from the industry model alone. A full report blends it with a discounted cash flow, comparable companies and precedent transactions.
Value your home services business in under 10 minutes
- 1.Upload your financial statements, or type the figures in.
- 2.Confirm the add-backs and the industry details the model asks for.
- 3.Get a valuation range, the methods behind it and a PDF memorandum.
Which numbers matter most?
Seller's discretionary earnings
EBITDA plus the owner's own pay and perks. VA uses the pay you enter; for a small owner-run company with no figure entered, it estimates a working owner's salary.
Agreement revenue
Revenue from service agreements and maintenance plans. VA values it as its own layer, separate from one-off jobs.
Contract renewal rate
The share of agreement customers who renew each year. The multiple on the recurring layer rises with it.
New-construction share
The part of revenue from work on new buildings. It follows the building cycle, so VA lowers the multiple on one-off work as it grows.
Company size
Seller's discretionary earnings set the base multiple: in VA's trades model a larger company starts from a higher one.
What do you need to value a home services business?
- Profit and loss statements and balance sheets, ideally for the last three years
- Figures for the current year to date
- A list of add-backs: the owner's pay and perks, and any one-off costs
- Loan and lease balances
- A list of maintenance agreements, with renewal dates
- Revenue split between agreements, repair and replacement, and new-construction installs
- Technician count and licenses
Example scenarios
Agreements against one-off jobs
Two home services companies earn the same. One has built a base of maintenance plans that customers renew every year; the other lives on repair calls and replacements. VA values the first higher, because its agreement layer is priced at the higher multiple.
A company tied to new homes
A company does much of its work installing systems in new homes for builders. Its earnings follow the building cycle, so VA applies a lower multiple to its one-off work, and the company is worth less than a service-led peer with the same earnings.
Guides by type of business
HVAC & Plumbing
Value an HVAC, plumbing or mechanical service company on the owner's earnings, with its service agreements valued as their own layer above one-off jobs.
Pest Control
Value a residential or commercial pest control company on the owner's earnings, with recurring service plans valued as their own layer above one-off treatments.
Landscaping
Value a commercial or residential landscaping company on the owner's earnings, with maintenance contracts valued as their own layer above installs and enhancements.
Roofing
Value a residential or commercial roofing company on the owner's earnings, with storm and new-construction work read separately from steady replacement demand.
Electrical Contracting
Value an electrical contracting company on the owner's earnings, with service and maintenance agreements valued as their own layer above project and new-construction work.
Security Systems
Value a security systems integrator on the owner's earnings, with monitoring and service contracts valued as their own layer above installation projects.
Equipment Maintenance
Value an equipment maintenance company on the owner's earnings, with preventive maintenance contracts valued as their own layer above call-out repairs.
Fire & Life Safety
Value a fire and life safety company on the owner's earnings, with inspection and monitoring contracts valued as their own layer above installation work.
Garage Doors
Value a garage door company on the owner's earnings, with repair and replacement work valued above installs for home builders.
Industrial Maintenance
Value an industrial maintenance contractor on the owner's earnings, with master service agreements valued as their own layer above one-off project work.
Commercial Cleaning
Value a commercial cleaning or janitorial company on the owner's earnings, with recurring cleaning contracts valued as their own layer above one-off jobs.
Mobile Repair
Value a mobile repair and on-site field service business on the owner's earnings, with service contracts valued as their own layer above dispatched call-outs.
Restoration
Value a water, fire and mold restoration company on the owner's earnings from a typical year, with the insurance programs and referral sources buyers check.
Specialty Cleaning
Value a specialty cleaning company, from kitchen hoods and ducts to pressure washing, on the owner's earnings, with scheduled contracts valued as their own layer.
Irrigation Services
Value an irrigation installation and service company on the owner's earnings, with maintenance contracts valued as their own layer above installation work.
Further reading
How to Value an HVAC Business in 2026: SDE and EBITDA Multiples
HVAC businesses sell for about 2x to 3.3x SDE for small shops and 5x to 9x EBITDA for larger firms. See 2026 multiples by size and what drives the number.
Is a Business Worth 3 Times Profit? When It Is 2x, When It Is 5x, and Which Profit Counts
Is a business worth 3 times profit? Often, if the profit is SDE. When 2x or 5x applies instead, which profit counts, and what diligence does to the price.
How Much Is a Business Worth With $500,000 in Sales? The Revenue Ladder From $100K to $3 Million
Revenue does not set a price, earnings do. See what businesses at $100K, $200K, $300K, $500K, $1M, $2M and $3M in sales are worth at 10%, 20% and 30% margins.
Frequently asked questions
How is a home services business valued?
On seller's discretionary earnings, EBITDA plus the owner's pay, with service agreements and maintenance plans valued as their own layer at a higher multiple than one-off jobs. Comparable companies, precedent transactions and a discounted cash flow check the result.
Do maintenance agreements raise the value?
Yes. VA values agreement revenue as a separate layer, and the multiple on it rises with the share of customers who renew. Enter the agreement revenue and your renewal rate to see the effect.
Does work for new construction lower the value?
It lowers the multiple on one-off work, because building activity rises and falls with the economy. Repair, replacement and service work holds up better when building slows.
What do groups that buy home services companies look for?
Route density, agreement bases that renew, technicians who stay and a manager who runs the company without the owner. They may pay more than a local buyer for a company that fills a gap in their map.
What if I pay myself less than a manager would cost?
Seller's discretionary earnings add back your own pay, so the level you pay yourself does not change that figure. A buyer who hires a manager will still look at EBITDA after a market salary, which is why the EBITDA-based checks are shown too.
Is this a certified appraisal?
No. This is an informational estimate. A bank loan, a partner buyout or an estate matter may require a certified business appraisal, which this does not replace.
Terms used on this page
- Seller's discretionary earnings (SDE)
- EBITDA plus the owner's own pay and perks. It shows what the business earns for one owner who works in it, and it is the figure most buyers of small owner-run businesses price.
- Add-backs
- Costs added back to reported earnings because a new owner would not bear them: personal expenses run through the business, one-off costs, or owner pay above what the role would cost to fill.
- Recurring revenue
- Revenue that repeats without a new sale, such as maintenance agreements, service plans or contracts customers renew.
- Renewal rate
- The share of customers on agreements or plans who renew each year.
- Valuation multiple
- The number earnings are multiplied by to reach a value. It rises with how durable the earnings are and how easily a new owner can keep them.
As featured in
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Related industries
Construction
Value a construction or contracting business on its earnings, with backlog, bonding, work in progress and the owner's role read the way buyers read them.
Property Management
Value a property management company on its fees and earnings, with owner retention, doors under management and ancillary fees read as buyers of a service business do.
Automotive Services
Value a car wash, repair shop or franchised dealership. VA's automotive model values each type on its own terms: members, earnings or the sum of its parts.
Professional Services
Value a consulting, accounting or agency business on its earnings, with seller's discretionary earnings in the blend for a smaller owner-run firm.
Last reviewed September 26, 2026 against VA's valuation models.