How Much Does it Cost to Sell a House?

How Much Does it Cost to Sell a House?

You should plan to spend 10% of the price of your home on selling costs and mortgage repayments.

You'll need to know the cost of closing a sale so you can plan your next home purchase.

You may also choose to do some things that are not mandatory.

Most common costs of selling a home

These are the most common expenses that you will encounter when selling your home.

Real estate agent commissions

A seller pays a commission between 5% and 6% on the purchase price of a home. The listing agent splits this with the buyer's representative.

When interviewing listing agents ask them what their commission rates are. Many will negotiate. Be sure to agree on the commission terms in writing.

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Taxes, fees and charges for the neighborhood

Taxes can vary greatly by region. Ask a real estate agent for advice on how much to budget.

  • Property tax owed: You may owe property tax if you have recently paid your taxes. If the due date is approaching, the amount you owe could be as low as zero dollars.
  • Real estate transfer taxes: In some states and local jurisdictions, a tax is levied when a property changes hands. This is not the same as a title filing tax, which can be a separate administrative charge. The amount is determined by your location, the value of the property, and local laws. It could be paid either by the seller, or the buyer.
  • Capital gains taxes: If you sell your home for more than $250,000. ($500,000 for married couples filing joint returns)
  • HOA fees: You will need to pay a prorated HOA membership fee if your neighborhood has an homeowners' association. There may be a transfer fee for the HOA.

Title insurance for the purchaser

The title insurance protects buyers in the event of a problem with the ownership history of the property.

According to the National Association of Realtors, the average cost of a policy is around $1,000.

During the sale of the property, the title company will conduct a title search to determine if there is a lien against the home. If so, you must settle the lien before selling the house.

Your current mortgage payoff

The payoff amount will be different than the amount due on your mortgage statement because of interest. This is important to know.

In the event that the selling price is not enough to cover your entire mortgage balance, you will have to pay for the difference.

Home repairs

Before closing, the buyer may order an inspection of your home. In case there are problems revealed in the report, you might be asked to cover any repairs or renovations necessary.

Moving costs

Budgeting money is important for moving, whether you hire a professional moving company or buy boxes and pack them yourself.

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Optional Costs to Sell a House

They are not always needed, but could make your home standout.

Home warranty

A year's coverage can cost between $100 and $1,000. However, some plans may be more expensive depending on what coverage is offered.

Home staging

You should clean and declutter your home before putting it on the market. However, your agent might suggest hiring a home stager in order to make it more visually appealing.

A professional home staging service can cost as little as $1,500 according to data collected by the National Association of Realtors in 2021.

Buyer's closing costs

In a slow-moving market, you might consider paying some of the closing expenses on behalf of the buyer.

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