Many home sellers don’t realize that unloading their homes costs money. Some expenses are negotiable, and some are fixed, while others vary depending on the location and size of the house. So, what’s the cost of selling a house? The average cost to sell a house is roughly 8%-10% of the sale price of your home.
In this article, we give you an overview of all of the costs you should be prepared for when you are out in the market to sell your house:
Breakdown of Home-Selling Costs
The costs occur in 4 stages of the home selling process.
- Preparing your home to sell
- Negotiating the sale
- Finalizing the deal
Here’s a detailed breakdown of estimated home selling costs.
PREPARING YOUR HOME TO SELL
Before you list your home, you need to ensure that your home is market-ready. You’ll need to prep your home to attract buyers. Some of the costs of preparing your home for sale include:
Pre-Sale Home Inspection
Estimated cost: $250-$700
According to the Zillow Group Consumer Housing Trends Report, 25% of sellers get a home inspection before contacting an agent.
Although a pre-inspection is optional, it tells you about the major issues that need to be addressed before showing the house to potential buyers. It also allows you to choose the right price and negotiate strategically.
Essential Home Repairs
Estimated cost: $4,000 to $20,000
Maintenance and repair issues are one of the primary reasons why pending home sales fall through at closing.
Ensuring your home is in good condition before the listing goes a long way in avoiding making major concessions to the buyer when an offer is on the table.
The total cost of repairs will vary based on your home’s condition. List out the necessary repairs, then decide what you can do yourself and where you’ll need to hire professional help. Before deciding on the contractor, make sure you compare quotes from multiple contractors to get the best deal.
Estimated cost: 1% of Sale Price
18% of sellers’ agents said home staging increased the dollar value of a residence between 6% and 10%
Although expensive, staging your home is an excellent way to impress potential buyers. If you decide not to spend a huge amount of money on staging your home, you can still make your home look good through virtual staging.
Truth be told, virtual staging is a lot cheaper than traditional home staging. It not only costs less but also helps you showcase the house’s best features. Moreover, through virtual staging, you can sell a vacant home or one that is still occupied by providing the buyers with the right vision of the house, one that would be comfortable to live in. Styldod can virtually stage your property for just $16-$19 per image.
Vacant or occupied, Styldod helps you sell your home faster and for top dollar. Contact us now!
Estimated cost: $150-$200
Although the investment is small, the payoff is huge. If you have hired a full-service listing agent, they may cover the real estate professional photos cost for you. If you want to DIY, you can click the photographs and use Styldod’s image enhancement services to transform them into
professional-looking real estate images.
Related article: Real Estate Photography: A Guide To Improve Your Real Estate Photos
Cosmetic Home Improvements
Estimated cost: Varies
According to Zillow, 79% of sellers make at least one improvement, which means that only 21% list their home as-is.
Repairs aside, consider what renovations your home needs that can be a potential return on investment.
For example, according to a NAR survey, the kitchen is the most important space for buyers. A small kitchen remodeling can cost you almost $21,200 on average.
If you don’t have as much money or time to spare, focus on smaller renovations that add value. Instead of a kitchen overhaul, consider changing cabinet pulls and installing a new backsplash. These small changes do not cost much but definitely catch a buyer’s eye and boost your home’s value.
Estimated cost: $500-$800
You may have to consider several types of professional home inspections before putting your house on sale.
Some of them are pest inspection, natural hazard inspection, roof inspection, and chimney and fireplace inspection. Professional home inspections give you a chance to fix problems before buyers can get upset about them.
Estimated cost: 1% of Sale Price
A seven-state survey showed that relatively large landscape expenditures significantly increase perceived home value, resulting in a higher selling price than homes with minimal landscapes.
Your curb appeal is your home’s first impression. So, make your home exterior look its best. If your garden is fully planted, you may have to hire someone to rake, prune and tidy up the place. If you haven’t landscaped it, you may consider adding some green and flowering plants, creating a walkaway, and light it.
NEGOTIATING THE SALE
After you are done prepping your home to list, the next obvious step is to wait for a buyer to make an offer. You are then gradually moved into the next phase of the selling process, which involves negotiations and another round of costs.
Real Estate Agent Commission
Estimated cost: 5% to 7% of Sale Price
According to the NAR study, 89% of sellers used agents to sell their homes.
Hiring a real estate agent to sell your house means paying them to handle the selling process for you, which involves arranging tours, updating your listing, professional photography, scheduling paperwork, etc. Usually, the commission is split between your agent and the buyer’s agent. Even if you decide not to hire a real estate agent, you may still have to pay the commission to the buyer’s agent (if an agent represents the buyer).
Estimated cost: 1-3% of Sale Price
When you offer a seller concession, it means that you have agreed to pay certain buyer’s costs to sweeten the deal, making it more likely to close. A buyer may ask for help with the processing fee, inspection fee, or any other costs. They may also use concession as a bargaining tool in a buyer’s market.
FINALIZING THE DEAL
Now that you are close to making a deal, there are still a few costs you need to plan for:
Estimated cost: 1% to 3% of Sale Price
Closing costs for the seller are usually lower because there are fewer fees involved. Typically, the main costs you’ll pay include the following:
- Transfer Taxes
Transfer taxes are applied when the home is transferred from one person to another. The amount you’ll have to pay depends on where the sale takes place.
- Mortgage payoff
Before you can officially close a sale, you need to pay off your mortgage. The proceeds of the home sale are usually used to pay off your loan.
Buyers Home Warranty
Estimated cost: $350-$1000
Buyers home warranty is a nice perk to offer your buyer, but it’s not a requirement. According to Realtor.com, this home warranty covers the repair and/or replacement costs for kitchen appliances as well as the plumbing, electrical, heating, and air systems. You can purchase this warranty to cover the home repair costs leading up to closing so that the buyer doesn’t have to face repair costs as soon as they close the deal. If you don’t want to offer a home warranty, you can offer to pay for a year or two of warranty coverage after closing.
Estimated cost: $500-$1,000
In some states, real estate attorneys legally supervise the closings. It may not be compulsory in other states, but you can hire an attorney for legal support during the selling process. Even if the buyer uses an attorney’s services, it’s considered a closing cost, and you may end up footing the bill.
Estimated cost: $20-$250
Whenever there is a real estate sale, the local government needs to document it for public record. Typically, the buyer pays the recording fee, which is very small compared to the other closing costs that you might pay.
Now that you are done paying all the costs associated with selling your home, you need to consider the various costs involved in relocating into your new home.
Estimated cost: 1-2% of Sale Price
Your moving costs depend on the following factors:
- Are you moving a short or long distance?
- What is the number of household items you are moving?
- Are you hiring a professional mover or doing it yourself?
If you hire a professional mover – packing your belongings, moving them into your new home, and unpacking them – are taken care of for a flat fee.
If you are going DIY, you may have to rent a moving truck, pack your own stuff, and pay for the packing materials required. It may save a few dollars, but it’s a big hassle requiring your time and effort investment.
How much does it cost to sell a house? This article gives you estimate costs involved in selling a house. Selling a home has its own shares of expenses, but it doesn’t have to be costly. With a bit of knowledge and a little preparation, you can lower or eliminate a few costs.