If you are looking at selling your home, the first question on your mind is probably, “How much can I get for selling my house?” You may have even started looking at listings of other homes in the area to get an idea of how much your home might sell for. But figuring out how much you’re likely to walk away with at the end up the day can be tricky. The hidden cost of selling a house is higher than you might think.
Some are obvious, like commissions and closing costs. Others are less so – like repairs potential buyers may ask you to make, the time and money it costs to get your house ready to sell, and the mortgage payments, taxes, and bills you will continue to pay until you find a buyer and the sale goes through.
When deciding the best way to go about selling your home, it’s important to keep all of these factors in mind. To help you understand the hidden cost of selling a house, let’s look at them in a little more detail:
When you are working with a real estate agent, you can expect to pay around 6% commission, split evenly between your agent, and the buyer’s agent. This is taken out of the sale price. So, for example, if you sell your home for $200,000, you can expect $12,000 of that to go toward commission. And even if you sell your home on the open market yourself, you’ll still need to pay commission to the buyer’s agent. In our example, that’s still about $6,000 coming out of your pocket.
2. Closing Costs
In addition to commission, you will need to pay closing costs to complete the sale of your home and transfer the property to the buyer. In most areas, closing costs range from 2% – 4%. On our $200,000 home, that’s another $4,000 to more than $8,500, depending on where you live. Combined with the commission, that can be over $20,000 in fees on a $200,000 sale price.
Now, the good news is that these costs are typically split evenly between the buyer and the seller, so you’re only on the hook for half. However, many sellers with homes in need of renovation or repair offer to pay all the closing costs. This is a good way to entice potential buyers if your home is not attracting offers.
3. Marketing, Listing Fees & Associated Costs of Selling a House
One of the advantages of working with a real estate agent is that they don’t usually charge you for marketing or listing fees – though if you are working with a discount broker or want additional marketing or listings beyond what they normally provide, they may charge you a premium. And if you’re trying to sell your house without using an agent, you’ll probably end up shelling out at least a few hundred dollars in listing fees, local ads and signs. Plus there’s the time you’ll need to spend making sure you get good pictures and creating the listings and ads.
4. Repairs Requested by Buyers
Depending on the condition of your home, buyers may make their offer contingent on certain repairs being made. The most common requests may be to fix leaky roofs, structural issues, major problems with the plumbing, electrical or HVAC, mold problems, and significant damage caused by water, termites or other pests.
All of these can significantly reduce how much money actually ends up in your pocket after the sale. And if buyers aren’t asking you to fix these issues, you should expect their offer to reflect the cost of fixing them themselves.
5. Mortgage Payments, Property Taxes & Utilities
Every day your home sits on the market, you continue to pay all the costs associated with owning that home. This is a big cost of selling a house people don’t take into account. This usually includes mortgage payments, property taxes, homeowner’s insurance, and utilities. It can also include property maintenance and repairs that cannot be avoided, such as a burst or leaking pipe, or drainage issues. These costs can add up quickly, especially if you are planning to move to a less expensive property, or if you inherited property and are looking to liquidate assets.
6. Time: Maybe the Biggest Hidden Cost of Selling a House
If you have an older home in need of repair, it can take a significant amount of time and energy to sell your home – especially if you’re looking to sell for as much as possible. You may decide it’s worth spending money on making renovations – but this is a big risk, and can take months and cost thousands. Even if you don’t renovate, it can take a lot of effort to clean your house inside and out and remove clutter to get it ready to show. And, of course, there are other time costs as well – such as not being able to move until you sell your home.
How to Avoid the Hidden Cost of Selling a House
Once you realize how much the hidden costs of selling a house can impact how much money actually ends up in your pocket, you may start to reconsider your options. One way to avoid these hidden costs is to sell your home for cash. Working with a real estate investor like Jacob Pays Cash means you won’t have to pay commission or closing costs, make repairs, or get your home ready to show. You won’t have to worry about marketing your home or waiting months for it to sell, either. In fact, we can usually close in less than 7 days. We’re also more flexible than most buyers and can work with your schedule. And we handle all the paperwork and will walk you through the entire process.
As one of the most trusted home cash buyers in Cincinnati, OH & Northern KY, our goal is to make selling your home fast, easy, and hassle-free, and create win-win situations. Keep more money from the sale of your home. Just answer a few questions about the property you are looking to sell, and in a few minutes of your time, you can remove the stress of selling your home and start the process of getting a quick, no-obligation, all-cash offer.