Selling a property takes time and money, typically more than the seller anticipates. When you’re thinking about selling, it’s tempting to get enthusiastic when you see how much your house’s worth has improved over the years, but it’s crucial to be prepared for the hidden, and frequently neglected, expenses of selling a property.
Homeowners spend an average of seven months planning and preparing to sell their house, and three months having their property listed, pending, and closing. Here are the costs you might anticipate throughout that period.
Costs Incurred Prior to the Sale of a Home
The cost of selling a house is a key factor to consider. Some costs are optional, but they might be crucial investments in ensuring that your property sells for the maximum potential price, or even sells at all.
1. Painting:
A new coat of paint is one of the most cost-effective methods to spruce up the inside and outside of your home. If your color selections were strong or unusual, you may want to tone them down with some crowd-pleasing neutrals. If you employ a home stager, they may advise you on the best colors to use. You may save money by doing part of the painting yourself. Hiring someone will rapidly cost you tens of thousands of dollars. For both interior and outdoor painting, reported rates of $3 per square foot of paint are typical.
2. Staging your home:
Staging your house or hiring a designer may make a major impression on purchasers. Consumers want to envision themselves living in the home, and staging can help achieve this. Expect to spend a few thousand dollars for services if you hire a professional home stager.
3. Landscaping:
Buyers are becoming more concerned about the condition of your garden. If it’s already planted, you’ll need to pay someone to rake, trim, and generally tidy it up. Plan to add some additional foliage and flowering plants to the area if it hasn’t already been manicured. Many sellers just lay down fresh sod; however, do the buyers a favor by not leaving the plastic mesh backing on it, in case the buyers wish to replace it with something more ecologically friendly.
4. Reports on pre-inspection:
In most places of the United States, having a professional check your home for pest/termite damage or other structural issues before placing it on the market is neither necessary nor anticipated. Buyers anticipate having to pay for their own inspections and may prefer to use somebody they know and trust.
5. Repairing the house:
Certain repairs are required, such as repairing broken windows or soiled carpets, while others are optional, such as significant remodels. However, there isn’t a single property that couldn’t benefit from some fast upkeep to help it seem well-kept. Make the buyer’s home inspector’s work easier by addressing some of the most frequent issues that inspectors face.
Closing Costs of a Home Sale
1. Moving expenses:
Approaching your friends with pickup vehicles for assistance may save you money, but it will take a lot more time. Sometimes, it’s worthwhile to pay for the deluxe service, where the movers pack your boxes, deliver them to the new place, and unpack them at the other end.
2. Property taxes:
If your state collects property taxes and you haven’t settled them for that year, you should be taxed a prorated portion of what the buyer will ultimately owe.
3. Commissions paid to real estate agents:
If you choose to engage with a real estate agent rather than go the FSBO (for sale by owner) route, you will very certainly be paying the whole 5% to 6% fee, which will be shared between the buyer’s agency and yours. Although dealing with an agent is free at the outset, the fees you pay at closing will be one of your largest costs.
4. Other closing fees or credits to the buyer of the property:
You may have agreed to pay some of the regular charges connected with finalizing the purchase based on local custom or buyer negotiation. These may include house assessment and mortgage fees, escrow company fees, property registration, and transfer fees, homeowners’ and title insurance, and other costs. If your local property market is slow, purchasers may also request that you pay all or a substantial part of the closing fees, which normally range from 2% to 5% of the selling price.
Be Aware of the Costs
It’s easy to get dissatisfied with all of the possible expenditures of selling a home. Keep in mind that many of these expenses can actually increase the market value of your house and help you sell it quicker. A quicker sale not only saves time, but also saves money by shortening the amount of time you own two residences.
Like homeownership, most of the expenses of selling your property are frequently a sensible investment. If you’re not sure how much it will cost to put your property on the market, do some research and get advice on how to make your house ready to sell.
