The idea of selling your home and cashing out your fairness is exciting, but it’s important to consider the costs before planning how you can use your profits. From agent fees and closing costs to repairs and staging, costs can increase rapidly. And depending on where you live – maybe it’s a condo in Los Angeles or a Boston home – your costs may be higher than initially expected. This Redfin guide breaks down how much it costs to sell a home.
Key takeout
Expect sales costs to total between 10% and 15% of the home sale price. This includes closing costs and mortgage repayments. Agent Committee fees are one of the biggest costs, but can be negotiated. Consider inspection costs, prepayment costs such as repairs and staging.
How much does it cost to sell a house?
The cost of selling a home is not perfect for all sizes, but most sellers should plan to spend around 10% to 15% of the selling price. Some people pay less, while others are able to pay more depending on their location, market conditions and home conditions.
Seller closure fees alone usually range from up to 6% to 10%, covering agent fees, title fees, transfer taxes and more. Plus, you might need to budget for repairs, staging, professional photography, and travel costs. If your home is highly valued, it could also be capital gains tax.
Good news? Most closure costs are deducted from the revenues at the time of closing, rather than being paid out of pockets. However, some costs (such as repairs and staging) require advance payment. With this in mind, the median US home prices currently stand at $418,478. This means that total sales costs could fall between $41,800 and $62,800. Below we break down the potential costs and get a sense of exactly what to expect.
Listing costs in advance to sell your home
Before your home will be on the market, you will need to invest in several key areas to attract buyers and maximize the selling price. Some people pass by with minimal preparation, while others may need to do some major repairs or upgrades. These costs are usually paid out of your pocket.
Listed home inspection in advance ($200-$500)
Normally, buyers pay for the inspection of the house, but some sellers choose to do listing inspections in advance to reveal potential issues before listing their property. This aggressive approach helps avoid surprises during negotiations, giving you time to do repairs in advance rather than under pressure. Tackling the issues early can help you fix them or adjust prices to reflect the state of your home, giving you stronger negotiation power.
Home repairs and improvements ($1,000-10,000+)
First impressions are important, and even small updates can make a huge difference how fast your home sells and at what price. Common repairs include:
Secure leaky faucets, repaint the walls to clean the carpet, and power wash for external update kitchen, bathroom or HVAC system replacement (for larger returns)
Home Staging ($500-$5,000)
Home staging is the creation of a welcoming and neutral space that allows buyers to imagine living in their own home. Some sellers may be able to handle this themselves, but many people should hire professionals as houses often sell faster than normal and at a higher price. Select. The cost of a professional staging service ranges from $500 to $5,000 depending on the size and location of the home. Some staging companies charge hourly, including number of rooms, furniture rentals, and more.
Real estate photos ($200 to $1,000)
Having high quality photos and videos is essential as many buyers are the first to see is the online list. Professional real estate photos, including virtual tours and drone shots, usually cost between $200 and $1,000. These visuals can help your home stand out from other lists, leading to more shows and higher offers.
Seller closure costs
Real Estate Agents Committee (3% to 6% of sales price)
The Real Estate Agents Board is one of the biggest costs of selling a home. Typically, between 3% and 6% of the final selling price, this fee is sent to the listing agent, and often to the buyer’s agent. Sellers can negotiate whether to cover the fee rate and the buyer’s agent fee.
Seller’s other closure costs (1% to 3% of the selling price)
In addition to the committee, the sellers also pay the closing fee. This is usually 1% to 3% of the selling price. These costs are:
Tax and Record Fees Transfer Escrow, Title Search, Record Fees Title Insurance Property Tax and Utilities Fees Attorney Fees
Seller’s concessions (1%-3% of the selling price)
In some cases, the buyer negotiates with the seller’s concessions. In other words, the seller agrees to cover some of the buyer’s closure costs. This is more common in markets that allow sellers to attract buyers by offering 1% to 3% of the selling price concession to 1% to 3% of the selling price. Concessions include assisting buyer with mortgage, home warranty or repairs found during inspection.
Cost of selling a home after sale
Possibility of mortgage payments and advance penalties (changes)
If you are still borrowing money for your mortgage, the remaining loan balance will need to be repaid upon closing. This is deducted from your home sales revenue. Most lenders don’t charge advance penalties, but some lenders do. Check with your lender to see if you need to pay an early payoff fee.
Capital Gain Tax (change)
If your home is highly valued, you may ow a capital gains tax on profits from sales. However, if you have lived in the home for at least two years of the past five years, you will be eligible for a $250,000 exemption (single filer) or a $500,000 exemption (married couple) on your profit before taxes apply. You can do it. If you are not eligible for the exemption, the capital gains tax rate ranges from 0% to 20%, depending on your income level.
Travel cost (over $1,000 to $5,000)
Once your home is sold, you will need to move with its own costs. The cost depends on distance, how much belongings you have, whether you hire a professional mover or rent a truck. Local movements typically cost between $1,000 and $3,000, while long distance movements can exceed $5,000. There are also storage costs to consider when reducing or relocating nationwide.
Total cost for selling a home: Example calculation
This is an estimate of what could cost you to sell a $400,000 home.
Cost Estimated Cost Agent Committee (5.5%) $22,000 Closure Cost (2%) $8,000 Repair & Upgrades $3,000 Staging and Photos $2,500 Seller Concession (1.5%) $6,000 Travel Cost 2,000 $2,000 Selling Cost $43,500 Home Loan Payoff balance $120,000 Net revenue $236,50000
In this scenario, a pocket costs approximately $7,500 before the sale is completed. If other expenses ($36,000) and mortgage payoff balance ($120,000) are deducted from sales revenue at the time of closing, you will have a net income of $236,500 from the sale.
FAQs about the cost of selling a house
1. What is the biggest cost to sell a house?
The Real Estate Agents Committee is usually the largest cost, typically in the range of 3% to 6% of the selling price. If there is a large-scale repair or renovation required, this is the next biggest expense for the seller.
2. Can I sell my house without paying a fee?
Yes, agents can sell without an agent using the Owner’s Sales (FSBO) method. However, FSBO homes are often less sold, and you may need to provide a fee to the buyer’s agent to attract buyers.
3. Do I have to pay for closing costs when I sell my house?
yes. Many closure costs are negotiable, but there are costs associated with the sale of the home that the seller will ultimately cover. For example, transfer fees and property taxes.
4. How can I reduce my sales costs?
Negotiation of the Agent Committee, selling without an agent, or selling a home (no repairs or improvements required) is all the ways in which you can reduce the cost of selling your home. However, each option comes with a trade-off. Sold without an agent can take time and lower sales prices, and AS-AS-seal can limit the buyer’s pool or reduce offers.
5. How much does it cost to sell a $500,000 home?
Selling a $500,000 home using an estimated 10% to 15% sales cost range will cost you a total cost of between $50,000 and $75,000.
6.What is the best way to estimate my total sales cost?
Start by considering the Agent Committee (usually 3%-6%) and other closure costs (about 1%-4%). Next, add estimates of additional costs you expect to incur, such as repairs, staging, and moving. An online home sales calculator also allows you to provide rough estimates based on the value of your home.
