How Much Does it Cost to Sell a House? True Costs Revealed
- on Jun 27, 2022
The price to sell the house is determined by the market conditions, but usually can range from 7.59 percent up to 8.59 percent or more than the value at the time of sale.
This means that sellers will pay at minimum $20,000to sell a house valued at $344,141 (the typical U.S. home value).
Here’s a good news story There is a way to reduce your house sale expenses when you shop around, and conducting some preliminary investigation.
- Free services for matching agents like Clever Selling House pre-negotiate lower commission rates for listing agents (sellers save $9,600 on fees per year, on average.)
- It is possible to shop for deals on specific closing costs, including the owner’s title insurance.
- Numerous variable costs, such as repairs and staging your home are not always necessary.
We’ll take a deeper look at the cost of selling a home, which includes the calculator for selling your home to estimate the cost and suggestions to help you save the cost of selling your home.
In the United States, we estimate that sellers usually pay 7.59 per cent in a house sale, but the overall amount could be higher than 8 percent based on the variable and additional costs.
In the above instance it will cost about $30,000 at the top end of the scale to sell a house valued at $344,141.
The actual costs of selling your home will depend on several elements, such as:
- Common Selling Commission rates for house agents for your area. The rates could vary according to what is typical in your region.
- Your achievement in negotiating rates through a listing agent. There are not all sellers who will achieve the success of negotiating lower rates.
- If you utilize an agent-matching service , you can find an agent. These companies offer sellers an added commission savings.
- If optional or variable costs are needed, for example, home staging, repairs and even moving costs.
- If the contract you signed for your home sale stipulates that you pay the buyers incentives such as closing costs or the home warranty.
Here’s how costs break into.
- Seller House agents commissions 5.49%
Realtor commissions are typically the biggest cost associated with selling a house.
The cost of a realtor varies widely from state to state, and can range from 4.90 percent to up to 6 percent, and the national average of 5.49 percent, based on our statistics.
Based on the median house value in the United States ($344,141) that means the average homeowner pays around $19,000 in Selling Commissions for House Agents in a typical sale of a home that requires two full-time agents. Looking to sell your house fast for cash? We beat the other guys’ offers Get an Information
The fee includes the agent of the seller as well as the buyer’s agent.
The home seller is usually in charge of paying the commission of the agent who represents buyers, to pay agents for the privilege of bringing a willing, willingand capable purchaser to the table.
Realtor commissions are deducted from the property’s cost of sale at the time of closing and often distributed evenly among the agents.
Do I have to sell my house without an agent?
It is possible to save yourself the cost of the commission of a listing agent by selling your home without the use of a real estate agent. This means you could save around $12,000 on the cost of an average U.S. home sale.
However, FSBO-homes are priced 26 percent less than properties listed with agents The lower selling price will negate any commission savings by not having the assistance of a realtor.
Additionally, you’re responsible for managing all the duties normally performed by a real estate agent and could take weeks or even months of your precious time. It’s like putting yourself in charge of an extremely stressful second job!
We strongly recommend talking to an Selling lawyer or broker, agent, or realtor to get more advice, particularly concerning your legal obligations and the requirements for selling.
Selling FSBO is not easy. Clever can help.
Don’t do it on your own. Our partners of Clever Selling House negotiate significant discounts with local real estate agents from top brands such as Coldwell Banker and RE/MAX. You can get 100% satisfaction with just one one percent charge for listings.
- Costs of closing: 1.1%
Other costs associated with selling a home usually add 1.1 percent or more the price of a house’s sale.
Based on the median home’s value across the nation A typical home-buyer is charged $3,789 for closing costs.
But, just like the commission paid to realtors closing costs, closing costs differ according to the area. You could be charged more, or less that the typical closing cost, based mostly on the location you reside in.
Here are some typical cost of closing a sale for sellers.
Taxes on transfer and recording
Also known as deed tax, stamp tax stamps, or real property transfer taxes, the charge is charged by your city, state or county. The fee is due before the deed’s record is made.
Transfer taxes are averaging of 0.44 percent across the country, which is $1,518 for the average home sale.
The exact amount charged is determined by your home’s tax assessed value as well as what your city or state is charging.
These charges are imposed by the local government to record legally your deed as well as other legal documents related to your house sale.
Recording fees cost $123 on average nationwide.
Prorated property tax
Sellers are typically legally required to pay for property taxes in the period up to the day of closing.
Taxes are divided between buyers and sellers. Taxes are paid according to the number of days they’ve owned the property in each calendar year.
The amount you pay for your tax is based on the amount of your tax bill each year as well as the amount of time you resided in the home up to the date of your sale.
For instance, suppose your tax rate is $5,000 annually and you are selling your home on January 31st:
- It is $13.70 daily in tax ($5,000 divided by the number of days in a year).
- You’ll be liable for taxes for the first 31 day of each year ($425).
- The new owner is responsible for taxes for all 334 remaining day ($4,575).
Example of a property tax prorated ($5,000)
Contact your attorney, realtor or title firm for further information on the amount you have to pay in tax prorated amounts.
HOA fees are the homeowner’s fee. (HOA) costs
There are a variety of HOA fees if the home you live in is in the boundaries of an HOA community. Here’s why:
- Sellers typically are accountable for paying an amount that is prorated to the dues to the HOA at the time of closing. The amount could vary from $100-$1,000 or more, based upon the size of HOA dues and the time you sell.
- Certain HOA communities could be required to charge fees for an HOA charge for transfer ($200-$300) for the transfer of property ownership records from you to the buyer upon the time of closing.
The buyer could be accountable for a portion of these expenses in certain markets. The fee could be negotiated in the sale contract.
Contact your attorney, realtor or HOA to find out more about the seller’s HOA fees, as well as who pays these fees upon the time of closing.
Insurance for title of the owner
Title insurance could or might not be required in your state, based on the laws of your state.
It safeguards both buyers and you from any possible issues related to your property ownership or deed It also provides security in the event of issues arising when you sell your house (or after the sale is completed).
In the United States, title insurance can cost homeowners $1,071 per year.
The cost of insurance on title for owners is a wide range, ranging between a few hundred and thousands of dollars. The exact cost depends on the location of your home, the insurance company, and the cost of your house.
Does it really require an insurance policy for title?
Title insurance for the owner should safeguard sellers from legal claims against the property or any errors in the deed.
Commonly, title claims stem due to a previous owner’s inability to pay taxes on their property, or due to contractors not paying for work that completed their work prior to the purchase of the house, according to the Consumer Finance Protection Bureau (CFPB).
The title insurance can be viewed as a cost for closing which you can search to find (and the CFPB recommends it).
selling House lawyer fees
It is possible to owe this cost in the event that your state requires closings to be handled by an attorney or if you decide to work with a real estate agent.
Selling House closing lawyers either offer a flat rate (typically between $800 and $1500) in addition to an hourly fee ($150 or $400/hour). Attorneys provide a variety of legal services, such as:
- Examining all your legal contracts and documents to ensure they are accurate.
- Helping you with questions that could arise during the sale, such as repairs requested by the buyer, and what happens to earnest money if the buyer decides to cancel the agreement.
- Recording, filing and confirming legal documents to make the sale legal.
Selling House regulations and costs vary significantly from state to state. Consult with your realtor to determine whether an attorney is required to oversee closings, if it’s worthwhile to hire one and what it could cost you.
- Other costs that could be incurred Other costs: 1% to 2percent
There are other costs which could add thousands to the cost of selling your house.
The process involves getting your home for prospective buyers through cleaning, organizing and arranging furniture.
It’s an average cost of $1,608 to stage a house, however, the cost varies from $745 to $2,659 according to HomeAdvisor.
Costs are based on factors such as your location, the size and quantity of rooms that are furnished and the amount of furniture that is required to be rental.
Does it really matter? 82% of buyer’s representatives claimed that staging helped for buyers to envision the property as a potential home according to an National Association of Realtors report.
But, it’s not required for every home buyer. It’s a matter of the condition and design of your house along with your budget and other factors that affect the market.
The term “deep cleaning” refers to the act of hiring a professional completely clean and eliminate any of the home’s dirt, grime, or scum.
The cost for a deep clean a home ranges from $300, and varies from $200-$400 across the nation as per HomeAdvisor. Some companies cost per hours ($25 or $50) instead of. an all-inclusive fee.
The factors that affect the total cost are factors like the dimensions of your house as well as the number of rooms to be cleaned and the amount of dirt accumulation, and if you’re in need of additional services like carpet or rug cleaning.
Home repairs and upgrades
There is a chance that you will require home repairs or cosmetic improvements prior to listing.
The exact costs are contingent upon the circumstances. If your house is damaged and you want to sell it for the highest price You’ll likely have to pay more to prepare it for listing.
But, if your home only requires some cosmetic fixes to boost appearance – such as some landscaping or paint it is likely to limit your expenses to $1,000.
Concessions for sellers
This fee is related to the buyer’s closing costs as well as expenses that are discussed in the purchase and sale agreement before an offer is accepted.
Here are some of the most common concessions from sellers to look out for.
- The closing costs of the buyer
Sellers and buyers usually pay for their own closing expenses. In certain cases the buyer might ask the seller to pay for part or all of the cost (2 up to 5percent of the property’s cost of sale) to reduce their expenses out of pocket.
You may be able to agree to this if the offer meets all the features you’re after and also if your house draws first-time home buyers with the tightest budget.
- Home warranty for the buyer
Certain home buyers, especially first-time buyers – request sellers to buy an insurance policy for their home. It’s a one-year contract which protects buyers from the expense of unexpected repairs.
A home warranty is priced at about $1,000, but can range from $219 and $1,841 across the country as per HomeAdvisor. Prices are largely determined by insurance coverage and whether any additional services are included.
- Repair credits
If a buyer is subject to an inspection of their home and uncovers significant issues during the inspection, they can ask for money at the time of closing instead of making repairs.
Repair credits are more prevalent in a market for buyers. In a market that is booming for sellers the majority of buyers will not ask for repair credits or completely skip an inspection.
The cost of transportation
It’s $1,639 for professionals to move your belongings for a short distance relocation (under 100 miles) as per HomeAdvisor.
However, your moving and cost of relocation could be more expensive for long-distance relocations. HomeAdvisor estimates an estimated cost of $4,703 to move across the country and as high as $10,000 for homes with larger spaces.
The actual cost will depend on the size and quantity of trucks needed, how you weigh your goods and whether you employ an all-inclusive company or lease the truck.
Prepayment penalties for mortgages, or payment fee
Certain lenders will charge you an early payment penalty or a payoff fee to pay off your loan earlier than the initial of three or five years after the date of loan creation.
The penalties for prepayment typically begin at 2percent of the remaining amount of your loan, if you are able to repay the loan within its initial year, but then decrease over the course of each year.
Check the fine print of the loan documents attentively The prepayment penalty must be clearly defined.
Request your lender to provide a mortgage payment estimate to determine what you may be owed, or contact for more details.
Capital gains tax
There is a chance that you will have to pay capital gains tax on the sale of your home. It is contingent upon factors such as the total amount of profit you earn and the time you lived in your home and whether you file your taxes either a couple or single.
The majority of sellers don’t owe taxes on capital gains, thanks to an IRS tax exemption. Sellers can be exempt from paying up to $250,000 of house sale profits ($500,000 when married) when they meet certain requirements.
Consult a tax expert for more advice regarding capital gains tax.
Utilize our calculator below to determine the cost it will take to sell your home. It covers Selling house agent commissions and closing costs that are typical as well as outstanding mortgages and some other costs that could be incurred.
NOTE:Our calculator’s figures are basing their calculations on national averages. It is possible that you will pay more or less for your home’s sale.
To obtain a more accurate estimate of the net proceeds from your house sale, ask an agent in your area to provide an unofficial seller’s net.
3 methods to save money when selling the house
The best method to cut costs on the cost of selling your house is to lower commission costs. By shaving just .50 percent off the commission rate could help you to save lots of money. This is how you can do it.
- Explore and negotiate with agents
You may shop around to find a real estate agent who has a lower cost in some cases, since some agents are more flexible with pricing than other.
However, it’s likely to be a bad idea to pick an agent solely because they charge the lowest price. Take into consideration the experience of each agent as well as their skills and feedback when you make your decision.
- Utilize an agent-matching service
A lot of home owners don’t have the time nor the knowledge required to bargain lower prices with real estate agents.
Luckily, many agent matching services can handle the task for you. Companies such as Clever match sellers with top realtors in the area, while they also negotiate lower fees.
For instance, Clever agents charge the listing fee of 1% for homes worth more than $350,000 as opposed to the national average price for listing of .
The next step:Find out which companies have the most affordable Selling house commission fees and then connect with Clever to find the top-rated agents close to you.
- You can sell without an agent
You may also decide not to sell using an agent at all and avoid having to pay commissions to the listing agent.
However, not having an experienced Selling house professional on your side is dangerous. First, FSBO houses are sold for as much as 26 percent less than homes listed by agents according of the National Association of Realtors.
It could also be a long time (or maybe even months) of hard work to get your house for sale. In certain ways, it’s similar to working a second job and it could not be able to pay any money.