Selling Cost

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Costs Associated With Selling A Home

While buyers also pay closing costs, you’ll see a long column on the HUD-1 Settlement Statement for seller costs.
Closing costs for sellers vary according to where you live, but as the seller you can expect to pay anywhere from 6 percent to
10 percent of the home’s sales price at settlement.

Before The Sale

Fix Ups

Which fix ups are necessary (such as replacing cracked windows or stained carpeting) and which (such as major remodels) should be left for the buyer to handle is a separate discussion in itself. But there’s practically no house that couldn’t use some quick maintenance to make sure it looks well-cared for and leaves fewer items for a home inspector to comment on.

Staging

It’s de rigeur in some parts of the United States, and less known in others — but staging your home, or having a decorator help declutter, reorganize, and in some cases refurnish it after you’ve moved your stuff out, can help impress buyers in a big way. In fact, studies show that buyers pay more for staged homes. Expect to pay a professional stager a few thousand dollars for their services (a bit less if some of your own furniture is usable.) For more on this topic, see Nolo’s article Is Hiring a Home Stager Worth the Cost?

Landscaping

Buyers are increasingly interested in the state of your garden. If it’s already fully planted, you’ll want to hire someone (or put in some sweat equity) to get it raked, pruned, and otherwise tidied up. If the area hasn’t already been landscaped, plan to add some new greenery and flowering plants. (By the way, if you plant in containers, you can take the containers with you when you move — unless they’re so big or incorporated into the property as to be considered “fixtures.”) Many sellers simply put in new sod — but do the buyers a favor and don’t leave the plastic mesh backing on it, in case the buyers want to replace it with something more interesting and environmentally friendly.

Pre-Inspection

Having a professional inspect your house for either termite/pest damage or other structural matters isn’t required, nor expected in most parts of the United States. Buyers expect to pay for their own inspectors, and in fact will probably want to hire ones they know and trust regardless of whether you’ve had the property inspected first. Yet there are situations where you might want to have the house inspected before letting buyers in — for example, if you’ve owned the property for many years and wonder whether any problems have arisen “below thehood” that you’re oblivious to, and would perhaps prefer to fix before buyers have a chance to get upset about them. Inspections will run you upwards of $200.

Utilities

If you’ll be moving out before putting your house on the market, expect to pay double utilities for a while. You’ll want to leave the lights and heat on in the house for sale, or program them to stay on during any hours that potential buyers and their agents may be stopping by the place. No one likes to enter a cold, dark house and fumble around for the light switches. Check your current bills for approximately what to expect.

Home Owner's Insurance

Check with your homeowners’ carrier. Your insurance may not apply when the home is “vacant,” which term will be defined in your policy. You can ask for a rider to cover any period of vacancy.

At Closing

Commissions

You, as the seller, will likely be paying the entire 5% – 6% commission, to be split between the buyer’s agent and yours.

Other Closing Costs

You might have agreed — based on local tradition or buyer negotiation — to pay various of the standard costs associated with closing the deal, such as fees for the escrow company; the mortgage and home appraisal; recording and transfer of the property; homeowners’ and title insurance; and more. If your local real estate market is sluggish, buyers may also ask you to pay all or a hefty portion of the closing costs, which typically add up to 2% to 4% of the selling price.

Transfer Tax

Your city or state may require you to pay transfer taxes, as a small percentage of the sale price.

Home Warranty For The Buyer

Whether because the buyer requests it or to make the buyer feel secure about the home purchase, many sellers buy a home warranty on the buyer’s behalf. This is a service contract that covers repairs to appliances and certain systems within the house for the first year of ownership. It will cost about $500.

Capital Gains Tax

If you earn less than $250,000 on your home sale (or $500,000 if you’re married and filing jointly), don’t worry — you won’t owe a thing in the way of capital gains taxes. But if you earn more than that, you’ll want to look further into the matter. Once you’ve subtracted things like the costs of preparing the property for sale from the supposed gains, you may not owe the tax.

Moving Costs

Asking your friends with pickup trucks to help can save you some dough — but will take a lot more time. Sometimes it’s worth paying for the deluxe treatment, where the company packs your boxes for you, transports them to the new location, and unpacks at the other end.

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