Putting your home for sale and looking for potential buyers is a long process. There are many things you need to prepare, and one of them is money. Some of the costs may surprise first-time home sellers. That’s why it’s essential to learn some of the costs of selling your property so you can plan on them accordingly.
If you’re a first-time home seller, here are the hidden costs of home selling you should be aware of:
1. Real Estate Agent Commission
Hiring a real estate agent is one of the best ways to ensure that your property will sell quickly. However, it always comes with a cost. A real estate agent will advocate on your behalf and communicate to the other party during price negotiations. Real estate commissions may vary depending on your location.
People usually pay three percent of the final sales price to their selling agent after the property is sold. For example, you sell your home at USD$ 100,000; you’ll pay your agent USD$ 3,000, which is usually subtracted from your profit and closing.
If you’re selling your home at a lower price, this could be a hefty sum. That’s why some people find cash home buyers who can buy their property for cash. Cash home buyers like The Local House Buyers will buy your home without the help of a real estate agent.
2. Appraisal And Inspection
Pricing your home too high or too low may affect your sale. That’s why before you list your property, you should be accurate with your price. The best way to check property value is through independent appraisal and property inspection.
Having your property inspected for possible issues is critical to its sale. If there are hidden problems that the buyer might see, it could cost you the transaction, or you might end up pricing your property much lower than you expected.
That’s why if your inspector finds some problems in your property, you need to address them before listing them for sale. You can also work with your real estate agent or appraiser on which projects you need to prioritize so they won’t affect the price of your home.
After inspection and repair, you should ask an independent appraiser to help you price your property based on its face value. An appraiser will examine your home and compare your property to similar ones near your location.
Hiring an independent appraiser and inspector may cost you between USD$ 600 to USD$ 1000. If you don’t want to spend too much and want to find buyers who won’t be too concerned about any hidden problems your home has, you can contact cash home buyers and visit sites like www.thelocalhousebuyers.com.
3. Staging Costs
Making your home presentable during open houses is one of the most important things you should do to attract many buyers. Depending on your target buyer persona, you should make the property look presentable and appealing. Aside from that, proper staging of your home allows you to increase your selling price by as much as USD$ 40,000. That’s why proper staging is also considered a good investment.
Many companies offer staging purposes. They arrange your home and even lend you furniture so your potential buyers will have a better feel of the place. They also make sure that your property is free from clutter before your open houses. You might need to spend at least USD$ 250 per room if you want to use these services.
4. Closing Costs
Closing costs are the other expenses that the buyer and seller usually incur to complete the real estate transaction. Closing costs may include:
- Loan origination fees
- Appraisal fees
- Title searches
- Title insurance
- Deed recording fees
- Credit report charges
- Lawyer’s Fee
Altogether, these fees are estimated to be between two and four percent of your selling price. If you work with a real estate agent, you’re expected to pay between eight to ten percent of your home sale price.
Knowing the hidden costs of selling your home means that you’re ahead of the game. This allows you to plan in case you may need money for repairs and staging. Some of these costs may be paid after selling your property, so it’s best to expect how much you’ll receive once you finish the sale.
Hiring a real estate agent will cost you a percentage of your sale. If you want to save on these costs, you might want to do the listing yourself and use online tools like social media to sell your home. You can also cut down repair and staging costs if you find cash home buyers who’re willing to buy your property at a lesser price. You must weigh everything first before making this decision.