Costs for Selling Your House

There is no shame in wanting the best deal you can get for your house. After all, you’ve probably spent a chunk of your life in it, not to mention a chunk of change and some blood, sweat, and tears. Many sellers who are ready to move on have understandable dreams for what they will do with the proceeds of their sale. You might even be hoping for a little extra for a weekend getaway once this is all over.

Reality Check: it actually takes money to sell a house when it’s all said and done. Consider a few factors:

Will I save money selling my house myself?

It sounds alluring. Snap a few pictures, post online, set up a sign out front, and you’re done, right? There are a few things potential sellers don’t realize:

  • The often-quoted 6% commission fee - roughly amounting to $15,000 for a $250,000 sale - gets divided several times before your agent sees any of it. That commission gets split first between the buyer’s agent’s brokerage and the seller’s, then the brokerages take their cuts and the remaining amount goes to your agent. In addition, please remember: your agent probably doesn’t receive a salary, so whatever time he or she has spent getting your home ready, plus photographs, signs, and listing costs comes out of that commission. If your house doesn’t sell, your agent doesn’t see a penny.
  • Speaking of agents: consider the hassle of not only keeping your house clean and staged, but managing calls, arranging showings, professional photography, hosting open houses, setting up legal representation for paperwork, and negotiating. Add to that the legal protection and access to the MLS agents have. It’s possible it may save you a little bit of money - probably not much in the end - to represent yourself, but is it worth sacrificing your sanity? After all, it is a real estate agent’s full-time job to sell your house.
  • Over 93% of active buyers have a real estate agent representing them according to realtor.com. In order to even attract them with your home, if you’re selling “by owner,” you have to pay the buyer’s agent’s brokerage fee anyway.

Do I need to do repairs to my home?

Do you need to fill every single nail hole? Probably not. However, if you haven’t completed needed home repairs, they may be caught in the home inspection stage and leave potential buyers wary of what else they will find if they buy your house. If you know you have major repairs to do, it’s better to be up front about it. A real estate agent is your best friend in this game, keeping your expectations realistic.

Will I have to pay closing costs? What About Taxes?

Buyers do end up paying more in closing costs, but as a seller you should expect to pay an additional 2% of your home’s price for this. Closing costs include transfer taxes, escrow expenses, and notary fees. You will be paying any outstanding property taxes you owe and your prorated share of utility payments plus the remainder of your mortgage. You also may have to pay a capital gains tax if the value of your home has appreciated since you bought it.

Take Away

If you are contemplating selling this year, you may want to take a breath and keep in mind all those hidden fees you don’t think about while you’re dreaming of sandy beaches. It’s best to go into this process knowing what you’re facing - even in a seller’s market.

If you are ready to put your house on the market, please give us a call. We would be honored to help.

248-348-7200