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How Much Does It Cost to Sell a House?

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You may spend over $25,000 to sell a median-priced home, based on current home prices in the U.S. Knowing what those costs are and how to reduce them will help you net the highest profit at the closing table.

Cost of selling a house: Breaking down what you’ll pay

According to data compiled by the St. Louis Federal Reserve, the median sales price of a home in the United States was $428,700 through the first quarter of 2022.

Real estate commissions

You’ll pay the real estate agents that help sell your home commissions ranging between 5% and 6% of the price of your home — or roughly $21,400 to $25,700 for a median-priced home. The fee is often split between your agent and the buyer’s agent.

Real estate taxes

Depending on where you live, you might need to pay transfer taxes, which are based on a percentage of your sales price. If you live in a state that collects property taxes, you’ll only pay a prorated portion of taxes owed until you transfer ownership to the buyer.

Closing costs

You may be asked to pay a portion of the 2% to 6% of a buyer’s mortgage closing costs if you’re in a soft housing market where there are more homes for sale than there are buyers. You can also expect to pay some title fees, escrow and attorney costs and recording fees to transfer ownership to the buyer.

Mortgage payoff

Any mortgage balance owing on your home will be deducted from your sales price. Your lender will provide a payoff statement that reflects the final amount necessary to release the loan.

Home staging

You may pay between $1,000 and $3,000 to stage your home if it’s empty. However, the cost goes up if you’re still living in the home to the tune of between $4,000 and $6,000. Studies show buyers may pay more for staged homes.

Home inspection

A home inspection can cost you between $300 and $1,000 depending on the size and location of your home. Although it’s not required, it’s worth it to know if the home needs repairs before you market it for sale.

Home repairs

If you want top dollar for your home, you should plan on fixing up obvious issues like cracked windows or stained floors. Your home will be competing against other homes, and buyers expect it to look well maintained.

Utilities

Make sure your utility bills are current when you sell your home, and plan to keep everything running if you’re aiming to move out before the home sells. Prospective buyers won’t be comfortable if there’s no air conditioning in the summer or no heat in the winter.

Moving costs

Although this won’t affect your bottom line at closing, you may need to spend some of your home sale cash on moving expenses that can run between $1,250 for a local move to $4,890 for a 1,000-mile move. That assumes you’re moving out of a two- to three-bedroom home: If you’re moving from a bigger home, you’ll spend more.

Capital gains taxes

You won’t owe any capital gains tax if you earn less than $250,000 on a home sale individually or $500,000 if you’re married and filing jointly. However, if you’re selling an investment property, you may end up paying taxes on a portion of your profit.

Calculating all the costs to sell a house

Below is a recap of the most common costs to sell a home:

Selling costHow much you’ll pay
Real estate commission5% to 6% of your sales price
Real estate taxesDepend on your city or state
Closing costsBetween 2% and 6% of the buyer’s loan amount
Mortgage payoffDepends on your loan balance
Home inspection$300 to $1,000 depending on the size and location of your home
Home staging$1,000 to $3,00 for a vacant home
$4,000 to $6,000 for an occupied home
Moving costs$1,250 for a local move
$4,890 for a move up to 1,000 miles

How to lower the cost of selling your home

1. NEGOTIATE YOUR AGENT COMMISSION FEES

Ask your listing agent to reduce the commission fee. If you sell your home for $300,000, a 6% commission fee is $18,000. Negotiating the fee down to 4% would lower the cost to $12,000, saving you $6,000. You could also negotiate who pays the commission. If several buyers are competing for your home, one might cover some of the commission for selling a house to win a bidding war.

2. DIY WHERE YOU CAN

Use your handyman skills to touch up the paint, replace outdated fixtures and take care of the landscaping on your own.

3. PAY DOWN YOUR MORTGAGE

Your loan balance will cut into your home sale proceeds. Before you put your home on the market, try aggressively paying down your mortgage to boost your equity — and the profit you’ll receive after closing.

Frequently asked questions

Yes, if your price is higher than your selling expenses.

If your home is underwater (worth less than you owe), you could end up having to pay to sell the home. Your lender may consider a short sale, which means it would approve the sale of your home at a price less than what you owe on your mortgage.

Yes, if you have solid financial skills and understand the legal ins and out of real estate sales contracts. Although you may save some money on real estate commission, studies show for-sale-by-owner (FSBO) sellers often make less than agent-represented sellers.

 

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