Accepting an offer on your house is an exciting time, but when it’s all said and done, how much does it cost to sell a house?
This helpful worksheet from the National Association of Realtors can help you keep track of the costs associated with selling a home so you know who pays what.
Costs of Selling a House
- Real estate commission is typically 5-6% of the sale price, split between the buyer and seller’s real estate agents. The seller usually pays the commission. Despite this expense, working with a real estate agent pays off in the end, as they can help you negotiate a better price for your home.
- Closing costs may include HOA fees, a pre-listing inspection, recording and settlement fees, title insurance, escrow fee, a brokerage fee, a courier fee and attorney fees.
- Property taxes: Sellers should pay a prorated portion of their annual property taxes at the closing.
- Transfer taxes: In New York State, the transfer tax of $2 per $500 is paid by the seller. There are additional taxes for luxury homes of $1 million or more.
- Utilities: Even if you move out of your house before its sold, you will need to continue to pay for electricity, water and heating/cooling.
- Mortgage payoff: The proceeds from selling your home will go towards paying off your mortgage, including prorated accrued interest. You may also have to pay a prepayment penalty, depending on the terms of your mortgage.
- Moving costs will vary depending how far you are going, how much stuff you are bringing and how much of it you can do yourself.
- Capital Gain on Taxes: If you sell your home for more than you bought it for, it needs to be reported on your federal tax return.
Optional Costs of Selling a House
- Pre-sale home inspection: Doing a pre-sale home inspection alerts you to any potential issues with your home and allows you to remedy them before showing the house. It shows prospective buyers you’ve done your homework, and gives them less opportunities to drive down the price. You can also purchase home warranty policies to make the property more attractive.
- Seller concessions: If a home inspection uncovers issues with your house, you may have to make concessions in order to close the deal. For example, you could cover some of the buyer’s closing costs such as the appraisal, title insurance and origination fee.
- Home improvements: Increasing your home’s curb appeal can result in a higher price tag.
- Staging: According to a National Association of Realtors survey, 31% of seller’s agents said a well-staged home leads to a quicker sale.
Now that you understand how much it costs to sell a house, you’re ready to list. Check out these tips to figure out if the timing is right!