Show me the money! Admit it, that\u2019s what you\u2019re thinking when you consider selling your house. In fact, chances are good you\u2019ve mentally spent much of the proceeds already\u2014on a new house you\u2019re buying, and maybe even a nice vacation this summer. Slow down there\u2014while selling a home can indeed bring in some sweet profits, not every dollar goes into your pocket. You also have to pay the professionals who help you unload your property. So now the question in your mind is probably: How much does it cost to sell a house? Really?<\/p>\n
On average, home sellers pay their listing agent a commission amounting to about 6% of the price of their home (although that percentage can vary). On a $250,000 house sale, this amounts to roughly $15,000.<\/p>\n
That might seem like a yuuuuge chunk of change, but don’t go assuming you’re getting ripped off! Here’s where that money goes, and why it’s totally worth it.<\/p>\n
The real estate agent commission, explained<\/strong><\/p>\n If you\u2019re picturing your real estate agent pocketing the whole sum, think again.<\/p>\n \u201cSellers are often confused by the often-quoted ‘6% commission fee,’ and it’s because many agents don’t explain clearly why it’s being collected,\u201d says David Nelson, a real estate professional with Re\/Max Advantage Plus in Minneapolis\/St. Paul.<\/p>\n In fact, that commission is split between the buyer’s agent’s brokerage and the seller’s. They might split it evenly, or the seller’s agent’s side might get a bit more. From those splits, the respective brokerages take their cut\u2014which, again, varies\u2014and the remaining amount goes to the agents.<\/p>\n Remember, most agents don\u2019t receive a salary, so that fee pays for all that time the agent spent marketing your home. It also includes costs like photographs and signage, as well as the cost to list it on the multiple listings service. And if your house doesn’t sell, the agent doesn’t get reimbursed for those costs\u2014or paid for her time.<\/p>\n How much sellers pay in closing costs<\/strong><\/p>\n While buyers tend to pay more in closing costs, sellers aren’t completely off the hook. You can expect to spend an additional 2% of your home\u2019s price on this expense, says Keith Gumbinger, vice president at mortgage information resource HSH.com.<\/p>\n Closing costs tend to be fixed, including transfer taxes, escrow expenses, and notary fees. You\u2019ll also pay at closing any outstanding property taxes, a prorated share of the water and sewage bills, and the remainder of your mortgage.<\/p>\n Yet you may have control over a few closing costs, says Gumbinger. If you hire a real estate attorney to oversee your side of the transaction, it\u2019s worth shopping around to compare rates. You might also be able to avoid a $100 to $200 reissue fee for the title search if you can provide a copy of your policy.<\/p>\n Should I just sell my house myself to save money?<\/strong><\/p>\n In a hot market, many sellers may think they can sell their house themselves to avoid the commission fees.<\/p>\n However, most people don’t realize that if you sell your house on your own, you still have to pay for the buyer’s agent’s brokerage fee.<\/p>\n \u201cSince over 93% of active buyers have a real estate agent representing them, it’s the only way to attract these agents\u2014and thus their buyers\u2014to even consider your home,\u201d Nelson says.<\/p>\n What about that cash they would still be saving by selling their home as “For Sale by Owner,” or FSBO?<\/p>\n Consider what your agent brings to the party:<\/p>\n \u201cIn the end, that \u2018savings’ to list a home yourself doesn’t usually save you any money,” Nelson says. “In fact, it can cost you in terms of time, stress, and often a lower price for your home.”<\/p>\n You know the saying “you get what you pay for”? Well, you also earn what you save. Think long and hard about your limitations in terms of time and expertise before heading down the home-selling path solo. After all, this home sale may be one of the largest financial transactions of your life, so it’s not exactly something you should cut corners on with the hopes of saving a few bucks.<\/p>\n","protected":false},"excerpt":{"rendered":" Show me the money! Admit it, that\u2019s what you\u2019re thinking when you consider selling your house. In fact, chances are good you\u2019ve mentally spent much of the proceeds already\u2014on a new house you\u2019re buying, and maybe even a nice vacation this summer. Slow down there\u2014while selling a home can indeed bring in some sweet profits, […]<\/p>\n","protected":false},"author":1,"featured_media":301,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7,8],"tags":[],"yoast_head":"\n\n