How Much Does It Cost to Sell a House?
The cost of selling a house can depend on location, fees, repairs and more. Be ready for the unexpected by learning what costs can be included and how to reduce them.
The costs involved when selling a home add up at every stage, from preparations, to listing, to closing. Knowing what costs and fees sellers pay when selling a house, and how to lessen their impact, is key to reducing stress and focusing on selling. Here is a list of costs that are typically involved in selling your home.
Costs to prepare your home
The more prep work your home needs to sell, the more it will cost. Staging alone can cost an average of $1,761, depending on several factors. Whatever you do to prepare, be sure it’s worth the investment.
Professional home staging costs likely include service and rental fees, which can balloon while your home is on market. Even a “move-in ready” home can cost a few hundred dollars to stage.
Professional cleaning and landscaping
Cleaning a house typically runs about 10 cents per square foot, depending on size and condition. Professional landscaping can add $4-10 per square foot, but that can easily multiply with large yard or tree projects.
Home repairs and maintenance
Repairs can be necessary or elective, but selling a home in good condition is key to a good offer. Sellers generally commit about five percent of their home’s sale price for repairs.
Home improvements and renovations
Most sellers make at least one home improvement project, costing about $5,000. If you can afford a remodel, it’s advisable to start with high value rooms, like the kitchen.
A professional photographer can cost from $100-300, depending on experience and scope. Quality photos, video, or virtual tours are relatively affordable when you consider their value for prospective buyers.
Home inspection costs vary by location, usually ranging from $300-$500. The size and age of a home also impacts costs.
Costs while on the market
Depending on your choices, some costs are incurred while the home is on market and may be impacted by how long your home takes to sell.
Utilities and holding costs
Homes on the market should have working power and water. Along with mortgage and HOA fees, such “holding costs” are a factor for sellers who don’t plan to live in the home while on market.
Sellers may purchase a warranty for major appliances or electrical, plumbing and air systems, especially for older homes. Cost can range from $200-$1,500 a year, depending on terms.
Other seller concessions
Other concessions a potential buyer may request are repairs and inclusion of major appliances, large furniture and other items that might be considered existing fixtures.
Costs in finalizing the sale
While the costs and fees for selling a house can be numerous, most hidden costs come at the end of a sale, when contracts and eagerness to close are center stage.
Real estate agent commissions
The typical commission split by real estate agents and brokers is 5-6% of the home sale price, traditionally paid by the seller.
Capital gains tax
Capital gains is a tax on your sale’s profit. Rates on long-term capital gains depend on your income, but there are ways to reduce or exempt the tax.
Annual property taxes for your home are due at closing, and the seller usually pays a prorated amount based on the closing date within the current tax year.
Transfer taxes on your sale price can be levied by cities, counties, or states and vary greatly (from 0-4%) depending on area laws. Most often the seller is expected to pay.
Title and escrow fees
Title fees, typically 1%, go the title company at closing for title review and title insurance. Escrow fees are typically 1-2%, often split between the two parties along with other closing costs.
Check state laws to see if a real estate attorney is required at closing. If so, one can cost $150-400 per hour, depending on experience.
Other closing costs
Closing costs can include the fees and taxes above along with a few others, like application and credit reporting fees. These typically total 3-6% of the sale price, and parties can either split closing costs or negotiate for the best deal.
If you have a mortgage, your home’s sale price will ideally be used to pay off whatever you owe. Check your agreement for any prepayment penalty that may be in effect.
Before getting started on your home sale, be sure you’ve factored in relocation costs if you’ll need to vacate, including any temporary housing or moving costs.
So, how much does it cost to sell a house?
Ultimately, sellers can expect to pay about 10% of the sale price to sell a home. How much depends on many factors, including local laws, tax rates, negotiating skills, and how much you’re willing to invest in preparing your home.
Four ways to reduce cost when selling a home
While you will will likely get a lower selling price, you can eliminate many of these cost by selling it as-is. Sundae can help you find multiple cash offers to compare so you can choose the best one. Sundae also provides flexibility on your closing date, and can even offer a cash advance of up to $10,000 on the sale of your home.
While services like landscaping, home repair, and photography can add value, you may save money if you can do them yourself and still sell quickly. You may still want to hire a qualified realtor, who should be able to advise you on further reducing costs.
If you have an eager buyer, try to negotiate on closing costs or other elements of the sale that can offset your investment.
Carefully go over every page of your contract and learn all you can about each detail or have a lawyer review. Until you sign, every element of the contract remains negotiable.
Selling to an iBuyer
The primary cost of selling to an iBuyer is likely a lower price, because most often they can pay less than fair market value. In addition, an iBuyer could require costly repairs, and service fees can run from 8-9%.