The current real estate market is on fire! If you’re a homeowner, you might be wondering, “How much does it cost to sell a house?” After all, houses in your market may have appreciated quite a bit since the pandemic, so there’s no better time to sell your home.
With that said, closing costs must be taken into consideration. In this article we’ll be covering various costs that can be included in selling a house; from closing costs to raising your home value.
Typical Closing Costs for Sellers
Your realtor will likely want to have the house professionally photographed prior to listing your property for sale. Additionally, they may incorporate furniture for the photography session to stage the scene for potential buyers.
There is a fee associated with this service. However, the expense is worth it! After all, a buyer’s first impression of your home will coincide with the pictures they saw online, so paying for a proper staging and professional photographs will be very beneficial.
It might sound counterintuitive to put more money into a house that you want to sell. However, it’s for a good reason. Simply put, a little bit of money can yield a massive return on investment.
You might be able to sell your house quicker and for a higher price if you put in a little bit of money in terms of maintenance and repairs. Let’s review some of the most common costs a seller will face when they are looking to sell their home.
First and foremost, if you’re looking to sell your home, you’ll want to make sure your home is in good condition before putting it on the market. This doesn’t mean you need to do an entire kitchen or bathroom renovation, but there is likely a handful of maintenance projects you could complete which makes your home more presentation.
Taking time out to boost your curb appeal can really make an impact on your home’s value. You’ll want to ensure that the landscaping is well maintained. This could include planting flowers, putting fresh mulch in the mulch beds, and cutting the grass.
Maintenance also refers to the removal of clutter. A cluttered home is incredibly distracting, and the clutter will make it hard for a potential buyer to visualize what their life would look like inside of the home. Remove all of your clutter to ensure that the house is neat and tidy.
A clean house shows a buyer you had pride in your home. No one really wants to tour a messy home. Consider steaming the carpets, vacuuming all of the floors, and making sure the bathroom is spotless.
A little bit of paint never hurts. If you have dark rooms, try to brighten them up by painting them a more neutral color. Ask your real estate agent which colors are currently trending or if they have any paint color suggestions.
You can paint a few rooms in your spare time. It’s worth the time investment because a simple change in paint color could result in a high chance of making a sale. All in all, it’s best to just make sure that general maintenance tasks are prioritized and completed. Replace any lightbulbs that are out, fix runny sinks or toilets, and grease any doors that squeak.
Real Estate Agent Commissions
If you’re working with a real estate agent, they will charge you a fee. But how much are realtor fees? Prices can vary and may lean on the expensive side, but it’s a one-time fee that will ultimately be the most expensive fee in the entire process.
A typical real estate agent fee is between 5% and 6% of the total price of the home. This is certainly a lot of money and it correlates to the sale price of your home.
Typical Closing Costs and Fees
You’re not out of the woods once the real estate agent takes their cut. As the seller, you must also pay closing costs. The following expenses are typically part of the average closing costs for sellers:
- Title Insurance: This expense ranges from $1,000 to $5,000 on average.
- Attorney Fees: Generally speaking, selling a home is a light legal lift for an attorney, but considering the importance of a real estate transaction, it is always wise to hire an attorney when buying or selling a home. Legal costs can range from $1,000 to $2,000.
- Escrow Fees: Your escrow fee will be contingent on the value of the property and the buyer requests that you’ve agreed to honor.
- Transfer Tax: This fee varies from one state to the next.
As mentioned above, it's always wise for the seller to put money towards the preparation of the house prior to making a sale. However, when a buyer is interested in purchasing your home, chances are they will use a professional home inspector to inspect it before they agree to any purchases.
A home inspector will check everything within the home and provide the buyer with an inspection report. If the home inspector identifies anything worth noting, the potential buyer may ask the seller to fix the issues before they will buy the home.
For example, the inspector may find that the roof is outdated and needs to be replaced. As a seller, you have the right to refuse fixing anything. However, doing so might cause the potential buyer to retract their offer.
Be mindful of what you may have neglected to fix over the years while owning your home. These elements can be a serious point of contention when it comes to selling your home.
How Can I Reduce the Cost of Selling My House?
There are a few ways to reduce the cost of selling your home. You can start by doing the work yourself. When it comes to getting your house ready to sell, you can often complete much of the preparation work on your own.
For example, don’t hire a painter to paint a few rooms. Instead, dedicate a weekend or two to painting the walls yourself. You’ll save quite a bit of money this way. Likewise, instead of hiring a landscaper to make your property look beautiful, see if a few friends are willing to help out for a few hours on the weekend.
If you are relocating for a job, ask if your employer is willing to absorb some of the closing costs. It never hurts to ask, and the vast majority of employees are given some sort of financial incentive to absorb some of this cost.
Maintain your home while you own it! It’s always best to maintain your home while you own it because it will prevent you from having to scramble to fix things when you go to sell your home. Time will be on your side this way, and that time could be used to get numerous quotes to complete a major home repair or renovation project.
Sell When the Timing is Right
Selling your home is a major life decision. Make sure the timing is right before you go to sell your home. While there are fees associated with selling your home, factoring these fees into the equation means that you can generate a major profit if you work with the right realtor and sell at the right time.
If you want to sell your home for top dollar, be sure to maintain your home over the years during which you own the home. This includes not only completing general maintenance and repairs but also updating your home if something is wildly outdated. While repairs and upgrades can require a little bit at a time, it can help your home appreciate above and beyond regular appreciation values.
This page last updated: March 21, 2022