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How much does it cost to sell a house?

white suburban house with green front yard and landscaping, for sale sign out front
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It might be a hot market right now, with over-ask offers and bidding wars becoming the norm, but many prospective homesellers don’t realize that offloading their home still costs money. Some expenses are negotiable, but sellers should still expect to foot all or part of the bill for the various costs to sell a house.

How much will it be? Plan for 5 to 6 percent of the purchase price to cover Realtor fees, which are typically paid by the seller. Add to that an extra 2 to 4 percent of the price to pay for costs like attorney fees, transfer taxes and other expenses. Here’s a rundown of typical seller costs, and about how much they will run you.

How much are real estate commissions?

The real estate commission is usually the biggest fee a seller pays — historically somewhere between 5 percent to 6 percent of the sale price. So, if you sell your house for $300,000, say, you could end up paying $18,000 in commissions.

The commission is split between the seller’s agent and the buyer’s agent. In most cases, the seller bears this cost. You may be able to negotiate a lower commission, however. Real estate agents could be more likely to accept a lower rate when the home is expected to sell quickly, the local market is strong or the home price is relatively high.

Many homeowners try to avoid paying commission by not using an agent and listing their home as for sale by owner (FSBO). If you do that, be prepared to assume the duties of an agent, including showing the place to prospective buyers, negotiating and handling things like the transfer of title. Just 7 percent of home sales in 2020 were FSBO sales, according to the most recent data from the National Association of Realtors (NAR). Furthermore, those homes sold for much less — $260,000 for the average FSBO listing, versus $318,000 for listings with an agent. So finding the right agent can pay off in a big way and help you negotiate a better price.

Another reason to work with an agent is that someone with expertise in the market can advise you on the best time to sell, which can limit the length of time your listing sits on the market gathering dust. If it takes a while, you could be stuck with what are commonly known as carrying costs: ongoing mortgage payments and homeowners association (HOA) fees, for example, while you’ve already moved into a new place.

Closing costs

In a real estate transaction, many closing costs are the buyer’s responsibility. But there are closing costs for sellers as well. Don’t be surprised if you are asked to foot the bill for some of the buyer’s costs, too, although that is somewhat rare in today’s seller’s market.

Some of these costs may include HOA fees, property and transfer taxes and title insurance. You also may be asked to pay an escrow fee, a brokerage fee and a courier fee. Additionally, if you have hired a real estate attorney to help negotiate the contract, the fees for his or her services will be due at closing.

Home repairs

If your home inspection uncovers big issues, such as a damaged roof or bad plumbing, you might have to pay to fix them in order to close the deal. Big repairs can set you back financially, so be prepared before you decide to sell, especially if you expect problems.

Utilities

Even if you plan to move out before you sell your home, you’ll want to continue paying for water and electricity. A home without air conditioning, heat or lighting can be difficult to show to buyers. Your current bills will give you an idea how much it will cost each month to leave on the utilities until a new buyer moves in. However, since you won’t be living there, you can take steps to reduce your utility bills as much as possible.

Mortgage payoff

The proceeds of your home sale will be used to pay off your mortgage, but the payoff amount on your mortgage statement is likely to be a little less than what you actually owe. You’ll likely have to add prorated accrued interest to the total balance. Additionally, you might have to pay a fee if there’s a prepayment penalty associated with your mortgage. Check your loan documents or contact your lender to find out if your loan includes this condition.

Selling one house and buying another? Use Bankrate’s calculator to determine how much house you can afford.

Capital gains taxes

Don’t forget to consider how selling your home will impact your taxes. When you sell a home for more than you paid for it, that counts as a capital gain and might need to be reported on your federal tax return.

The good news is, many homeowners are eligible to exclude up to $250,000 of profit ($500,000 for married couples filing jointly) from their taxes, as long as they haven’t used the tax break on another home sale within the past two years. The tax break applies if it was your primary home for at least two out of the previous five years. If you have used it as a rental, you may still be able to use the tax break. Consult a tax professional to make sure you are taking advantage of all opportunities to minimize what you owe the government for your home sale.

Property tax

Sellers also need to remember property taxes, which are usually paid in advance. The seller should pay the prorated share of property tax up to the closing date, with the money placed in escrow.

However, if you’re selling your home and have already paid taxes for the year, you may actually get a rebate at closing. The buyer will reimburse the seller for the portion of taxes already paid that apply after the closing date.

Transfer tax

Property taxes aren’t the only taxes you may need to cover when you’re selling your home. Depending on where you live, you may need to pay real estate transfer taxes, which is a tax charged by the local government on transferring the ownership. It is typically a percentage of the sale price. However, you might luck out here, as many states do not have transfer taxes.

Moving costs

If you’re selling your place, you’re going to have to move all your stuff. Paying for that will set you back between $871 and $2,396, according to HomeAdvisor. However, that price tag can be a lot more if you’re moving a large home or if you’re moving across the country.

If you want to save money on your moving costs, you can consider doing it yourself. Be honest, though. Can you manage all that heavy lifting? You might save money on the move, but you also might need to pay for a massage and take some days away from work after it, too.

Optional expenses

While some expenses are unavoidable, there are other optional costs in selling a house that might help you sell for more money or ensure that the deal gets done.

Pre-sale home inspection

A pre-listing inspection could cost around $340, according to HomeAdvisor data. Some sellers make the investment because they want to find out about any major problems before a potential buyer comes in. Getting a pre-sale inspection allows you to make the repairs ahead of time, removing any possibility of a buyer demanding them later or asking you to lower the price.

Discuss with your real estate agent whether a pre-sale home inspection is recommended. Keep in mind that if your inspection reveals material defects, you may have a legal responsibility to disclose them to a buyer.

In addition to paying for a home inspection, some sellers purchase home warranty policies that can make a property even more attractive to prospective buyers. The cost for this coverage has a wide range — $219 to $1,843, according to HomeAdvisor — but it can provide extra reassurance for buyers.

Seller concessions

Buyers sometimes request concessions from the seller, which essentially means that you help cover the buyer’s closing costs. For example, you might agree to contribute a portion of your sales price toward appraisal, title insurance and origination fee.

You definitely don’t have to agree to this, though — particularly if your area is a seller’s market. If it’s a buyer’s market, though, seller concessions can help make a difference in getting a deal to the finish line. Also, even if you’re willing to make concessions, there are limits based on the type of mortgage your buyer is using and how much they are contributing for a down payment.

Home improvements

Before you sell, you might be tempted to complete a project that seems likely to increase the value in a buyer’s eyes. Some renovations can recoup the majority of their value when it’s time to sell. Even a few affordable ways to boost your property’s appeal, like cleaning the windows and sprucing up the landscaping, might be better than selling your home as-is. Most sellers take some kind of steps to enhance their properties. However, before paying to enhance your home’s value, it’s wise to ask a real estate agent whether the cost will be worth it.

“One of the most common mistakes I see from sellers is spending money on the wrong improvements before getting a Realtor involved,” says Charly Marggraf, an agent with Compass in Minnesota. “Often, a seller will hold certain improvements in a higher regard than the general buying public – whether it be finishes that they spend too much money on or have too personal a taste, or landscaping and mechanical updates that they won’t realize a profit from. I appreciate that sellers want to get their homes in great condition before they sell, but if they are making improvements in order to sell, they definitely need to have a conversation with a professional before they spend their money.”

Home staging

Sellers might also consider staging their home to make it more appealing to buyers. The cost to stage a home ranges widely, depending on the size of the home, whether you’re renting furniture and more. Home staging can make a meaningful difference in some situations. According to NAR data, 18 percent of sellers’ agents said that home staging increased a home’s value between 6 and 10 percent. And a well-staged home can lead to a speedy sale: 31 percent of sellers’ agents said that staging greatly decreased the time a listing spent on the market.

In addition to staging the interior of the home, you may want to consider how to improve the exterior with extra love for your landscaping. A well-groomed yard can make buyers feel right at home as soon as they look at photos of your property.

Cost to sell a house example

Every property is different, so you’ll need to carefully consider what will impact the math on selling your house. To give you an idea of how this breaks down, let’s consider a property purchased for $300,000 four years ago. You made a down payment of 5 percent, $15,000, so your initial loan was for $285,000. You’ve paid down the balance to $250,000. In the meantime, thanks to a surging real estate market, the property will sell for $365,000. But how much of that $115,000 net profit will actually be yours? Here’s a rundown of what the costs might look like to help you understand.

Common transaction costs you’ll probably pay

Real estate commissions $21,900 (6 percent of purchase price)
Property taxes Depends on location
Transfer taxes Depends on location
Title insurance $3,650 (Typically a percentage of purchase price, in this case, we’ll use 1 percent)
Attorney fees $500 (can vary depending on the workload and location)
Escrow fee $1,825 (0.5 percent fee representing seller’s portion)
Utilities $262 (based on one month average, according to move.org, but this varies widely)
Repairs $3,650 (varies widely depending on the state of your property)
Moving costs $1,633 (average cost for a move less than 100 miles, according to HomeAdvisor)
Mortgage payoff $250,000
Sum $283,420

Optional transaction costs you might pay

Seller concessions $5,475 (1.5 percent of purchase price with a buyer putting down less than 10 percent)
Pre-listing home inspection $340
Home warranty $1,029
Home improvements $5,000 (varies widely depending on the state of your property)
Home staging $1,603
Sum $13,447

In this scenario, your total costs might range from $283,420 to $296,867. That leaves you with a walkaway profit somewhere between $68,133 and $81,580.

Reducing the cost of selling a house

If you’re looking to trim your expenses when you’re selling a house, you have a few options. You can try to sell the property on your own to eliminate real estate commissions. Keep in mind, though, that this can impact your ability to command a higher price for the property. You might also consider selling to an iBuyer, although the same rule applies: Without an agent to help leverage competition in the market, you might be leaving money on the table. If you do opt to use an agent, consider asking about the potential for a reduced commission fee.

In addition, scrutinize your optional costs. In today’s seller’s market, you likely don’t need to make concessions, and you may be able to get away without investing in any improvements or staging. If the home is in good shape, you might well find plenty of buyers without doing any additional work.

Frequently Asked Questions

Bottom line

Selling a house is exciting. But it isn’t free. As you think about listing your home to cash in on the real estate craze, be sure to have a clear understanding of the fees you’ll need to pay to get a sense of how much money you will actually make.

Written by
David McMillin
Contributing writer
David McMillin is a contributing writer for Bankrate and covers topics like credit cards, mortgages, banking, taxes and travel. David's goal is to help readers figure out how to save more and stress less.
Edited by
Senior real estate editor