The short answer: home care businesses sell for an average of 2.84× SDE (across 92 reported transactions) or about 0.60× revenue. In dollars: roughly $430,000 for an agency producing $150,000 of SDE, up to $850,000+ at $300,000 of SDE. The distinction that shapes everything: non-medical home care (companionship, daily living help) versus Medicare-certified home health (skilled nursing), two different licenses, payer systems, and buyer pools. Know which one a listing is before you price it.
Why buyers keep coming to home care
The demand story writes itself: an aging population that overwhelmingly prefers to age at home, and demand that grows regardless of the economy. What the demand story hides is where the constraint actually sits: not in finding clients, but in recruiting and keeping caregivers. An agency's real capacity is its staffed hours, and the agencies that win their markets are the ones caregivers stay with. When you evaluate one, you are evaluating an employment brand as much as a client book.
The second structural fact is the payer mix. Private-pay hours bill at rates the agency sets and collect quickly; Medicaid-waiver and VA hours bring volume with slower, state-set rates and program compliance. The mix decides margins, working-capital needs, and how insulated the revenue is from a single program's rate change, which is why it leads the diligence table below.
What home care businesses sell for
| Measure | Figure | Notes |
|---|---|---|
| SDE multiple | 2.84× average | Across 92 reported home health care transactions |
| Revenue multiple | 0.60× average | Same dataset |
| Worked example | $150K SDE → ~$430,000 | At the average multiple |
Where a specific agency lands around that average:
| Pushes the price up | Pulls it down |
|---|---|
| Private-pay-heavy mix at self-set rates | Dependence on one Medicaid waiver program's rates |
| Low caregiver turnover with a real recruiting pipeline | Chronic understaffing capping billable hours |
| Long-tenured clients across many referral sources | One hospital or case manager feeding the census |
| A scheduler and care coordinator who are not the owner | The owner personally scheduling every shift |
| Clean visit records that reconcile to billing | Hours billed that visit logs cannot support |
| Business size | Implied price | Note |
|---|---|---|
| $500,000 revenue | ~$300,000 | Owner-operated, thin management |
| $1M revenue | ~$600,000 | The typical first acquisition |
| $2M revenue | ~$1.2M | Staffed office; SDE method usually prices higher here |
Illustrative sizes priced at the dataset averages; a specific agency lands on its payer mix and staffing.
The diligence that makes or breaks a home care deal
| What to verify | The question it answers | Where it shows up |
|---|---|---|
| Payer mix and rates | Who actually pays, at what rate, set by whom? | Billing system by payer; program rate schedules |
| Staffed hours vs billed hours | Is capacity real, and is billing honest? | Scheduling system reconciled to invoices and payroll |
| Caregiver roster and turnover | Does the workforce survive the sale? | Payroll tenure; W-2 vs 1099 classification |
| Referral source concentration | Does one discharge planner feed the census? | New-client log by source |
| License and survey history | Is the license clean and transferable? | State agency file; change-of-ownership rules |
The reconciliation that catches inflated home care deals
Billed hours versus scheduled hours versus payroll hours. All three systems record the same visits; when billing shows hours that scheduling and payroll cannot support, the revenue is not real, and in program-funded care that gap is not just a valuation problem.
Worker classification deserves its own line: an agency built on 1099 caregivers where the state expects W-2 employment carries a reclassification liability that follows the business. It is a question for your attorney before the LOI, not after.
Licensing: state-by-state, and the home care vs home health line
Most states license home care agencies, and change-of-ownership usually requires state approval, sometimes with a survey. Medicare-certified home health is a different tier entirely, with federal certification that transfers under its own rules. Neither requires the owner to be a clinician, but home health requires clinical leadership on staff. Verify the state's rules and the transfer path before pricing anything.
How a typical home care purchase is financed
| Source | Amount | % of price |
|---|---|---|
| SBA 7(a) loan | $540,000 | 90% |
| Equity injection (total) | $60,000 | 10% |
| of which: standby seller note can cover | up to $30,000 | up to 5% |
| of which: your cash portion | as low as ~$30,000 | ~5% |
Receivables timing matters here more than in most deals: program payers pay slowly, so working capital belongs inside the loan, covered in the working-capital guide and the broader financing stack.
Check an agency's debt coverage
Where to find home care businesses for sale
| Channel | What you find there | How to work it |
|---|---|---|
| Marketplaces | Steady inventory of local agencies | Alerts on; see the marketplace comparison |
| Healthcare-specialist brokers | Larger and Medicare-certified agencies | Brief them on state and payer mix |
| Direct outreach | Founder-operators burning out on scheduling | The off-market playbook |
Evaluating an agency's census and staff?
The free training covers how members verify recurring service revenue and buy people-businesses safely.
Every claim checkable: member closings, self-reported and published unedited.
Frequently asked questions
Home care businesses sell for an average of 2.84 times SDE across 92 reported transactions, or about 0.60 times revenue. An agency producing $150,000 of SDE prices around $430,000; a $1M-revenue agency around $600,000 on the revenue method.
Home care is non-medical: companionship and help with daily living, licensed by the state. Home health is skilled clinical care, Medicare-certified, with clinical staffing requirements and its own transfer rules. They are different businesses with different buyers, and a listing should say clearly which it is.
Payer mix first: who pays, at what rates, set by whom. Then reconcile billed hours against scheduling and payroll, check caregiver tenure and W-2 versus 1099 classification, map referral-source concentration, and pull the state license and survey history.
No for non-medical home care; the owner needs the state agency license, not a clinical credential. Medicare-certified home health requires clinical leadership on staff, though not necessarily an owner-clinician. State rules vary, so verify before the LOI.
Yes, with the standard 10% equity injection, about $60,000 on a $600,000 agency, and up to half of that can be a standby seller note. Because program payers pay slowly, build working capital into the loan.
Sources
Multiples and transaction counts: Sundance Financial, SDE Multiples by Industry (2026), averages across 9,500+ small-business transactions reported in 2025. Licensing and change-of-ownership rules vary by state; verify with the state licensing agency. SBA mechanics: our equity injection guide.
