Selling your home is a big financial and emotional decision. You have to figure out how much real estate agents cost, how much your home is worth, come up with a list of prospective buyers, stage it for showings, and manage all the paperwork.
Because there are so many steps in the process of selling your home, you need to know how much it’s going to cost you. If you’re serious about selling your home, you need good information beforehand. There are several upfront costs involved in selling your home.
Title Search and Escrow
A good real estate agent will conduct a title search to make sure there isn’t anything in the title that will affect your ability to sell the property. The search will look for any liens, easements, or other encumbrances.
An escrow agent will hold the proceeds of the sale in an interest-bearing account while you and the buyers work out the details of the sale. This protects you in case the buyers back out. You can expect to pay $300 to $500 for a title search and an escrow account.
The amount will vary by location. Ask the real estate agent to itemize all the costs associated with the title search and escrow so you know what’s included. Then you can decide if it’s worth the cost to go with a particular agent.
Marketing costs
Your marketing costs will depend on the type of advertising you choose. If you decide to go with a real estate broker, they should provide a list of suggested marketing options. Here are a few options:
Newspaper ads: If you decide to run newspaper ads, you’ll have to pay for placement. Most newspapers charge a per-word rate. If you choose this advertising option, be careful to keep your ad short. Most newspapers allow advertisers to only use a couple of sentences to describe the property.
Open houses: If you’re looking for a quick sale, an open house could bring in eager buyers. Open houses are free, but you’ll need to decorate the inside of the home and keep it tidy. You’ll also need to be prepared to answer lots of questions.
Internet: You can pay to promote your home on major real estate websites or buy a premium ad on a smaller site. These sites let you create a detailed description of your property and include photos. Some sites also let you set a price or offer terms of sale. Many sites also have features that let you track the number of visitors and show who clicked on your ad.
Signage: If your home sits on a busy street, you might want to add a sign to let drivers know you’re selling your home. Be careful to follow any rules and regulations for signage in your area, such as rules about size.
Agents’ services: The real estate agent will help you decide which marketing options are best for your property. Some agents charge a fee to list your home, while others offer the service for free. You’ll also need to pay for repairs, staging, and other services that agents offer.
Realtor.com: This website is run by the National Association of Realtors. The site charges a fee for agents to list properties for sale. The fee is often rolled into the total commission amount. Potential buyers can view your listing for free.
Repairs and staging
You’ll need to make repairs and improvements to your home before listing it for sale. Whether you hire someone or tackle the job yourself, repairs can get expensive. If you have carpet, now is the time to replace it.
Other home renovations to consider are landscaping, painting, and repairs to the roof and foundation. You can hire professionals to do the work or get advice on how to do it yourself.
Many real estate agents can give you advice on what repairs to make or what improvements to make before you list your home. Staging your home is critical when selling it. This means cleaning and rearranging the inside of the home so it looks attractive to prospective buyers.
Cleaning services charge a lot, especially if you want a deep clean that removes tough stains. You can hire a staging company to help you rearrange the inside of the house and make it look attractive to buyers. These companies charge a fee for their services.
Commissions
Your real estate agent will charge you a commission on the sale of your home. The amount varies from state to state. Some states even have laws that make the commission a set fee.
Before you choose an agent, get a list of the services they offer and the cost. You can negotiate the price or find another agent who will charge less. Before you sign a contract with an agent, ask to see a sales history. You can also ask other real estate agents for the average commission they charge on sales.
This way you’ll know what the total cost of selling your home will be. If you want to sell your home without an agent, you’ll need to do the legwork of finding buyers yourself. You’ll also have to pay a fee to a broker to list your home.
Miscellaneous costs
There are other costs associated with selling your home. Make sure you have enough money to cover closing costs. These vary, but you can expect to pay between 2% and 6% of the sale price of your home.
You may also need to pay property taxes and insurance while your home is listed for sale. If you decide to do repairs before you list your home, you’ll need to pay for the materials upfront. You might also have to pay someone to do the work for you.
Finally, you’ll need to pay for utilities while you’re waiting to sell your home.
Selling your home for cash vs. selling with a real estate agent
You might decide to skip the real estate agent process and try to sell your home for cash. While this is an option, it’s best to use a real estate agent. Agents help you price your home correctly and provide access to a network of potential buyers.
Without an agent, you’ll have to do all the advertising and showings yourself. You’ll also have to do the paperwork for the sale yourself. If you want to sell your home for cash, you’ll need to advertise the property yourself and find someone to buy your home.
You can use the same marketing tools that real estate agents use. You may have to lower the price of your home to sell it without an agent. You’ll also have to do all the paperwork and sign the sales contract.
Key takeaway
Selling a house is a big financial and emotional decision. You have to figure out how much real estate agents cost, how much your home is worth, come up with a list of prospective buyers, stage it for showings, and manage all the paperwork.
Because there are so many steps in the process of selling your home, you need to know how much it’s going to cost you. Your title search and escrow fees are the first up-front costs you’ll encounter.
Then you’ll need to decide how much work you want to do to prepare your house for sale. The more you do yourself, the less you’ll pay for the sale. It’s possible to sell your home for cash, but you’ll have to do all the work of finding a buyer yourself.
