Here’s how much it costs to sell a home

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How much does it cost to sell a home? That depends on your market — if it favors buyers or sellers. It also depends on what’s customary in that market. Typical costs include:

• Commissions to real estate agents and/or your own marketing costs
• Closing costs normally paid by the seller — in many locations, half of the escrow and title charges
• Whatever closing costs buyers can negotiate — sometimes seller-paid costs are better for buyers than a price cut

In addition, some mortgage programs, like VA loans, do not allow the buyer to pay certain costs — recording fees, termite inspections in most states, and attorney fees. However, with most mortgages, anything is negotiable.

List of costs to sell a home

If you’re thinking of selling your home, you’ll want to get a handle on the likely costs. Understand that these depend on whether you or the buyer have the most leverage, what’s customary in the area, and you negotiate your deal — for example, you may get a higher price if you;re willing to cover the closing costs of a cash-poor buyer.

Related: Get sellers to pay your closing costs

Checklist

Here are the main things you should include in your selling budget. You’ll find more information on some of them further on:

• Pre-sales preparation of the property — To get the optimum price, you’ll likely need to spend some money on essential repairs and cosmetic improvements
• Extra homeowner’s insurance premiums — If your move involves leaving your property vacant, you should talk to your insurer about the extra cover that requires
• Real estate agents’ fees — Those frequently come in at 5-6 percent of the sale price. If your purchaser uses a buyer’s agent, your agent will normally split the commission
• Your own marketing costs — You can choose to go it alone (for sale by owner, FSBO) or pay for a discounted service in which an agent just lists your home on the local multiple listing service (MLS).

Related: Your complete guide to FSBO (for sale by owner) transactions

• Buyer’s closing costs — In some parts of the country, it’s traditional for sellers to pick up the tab for some or all a buyer’s closing costs. Everywhere, it’s possible for sellers and buyers to reach such an arrangement during negotiations. If you agree to pick them all up, you’ll typically be looking at 2-4 percent of the sale price
• Home warranty — as an incentive, many sellers pay the cost of a home warranty, which covers repairs to systems like HVAC, plumbing, appliances and electricity. They cost about $400 - $600
• Moving costs — These can range from a few pizzas for pals who help you move to thousands for a full-service removal company. If your buyer demands a quick close and you agree, you could be facing storage costs, too

Read on for more information to help you discover what it costs to sell a home.

Pre-sales preparation of the property

Selling your home is like marketing any product. You’ll get the optimum price for it if you make it as attractive as you can to as many potential buyers as possible.

Unless your home looks like the star of this month’s edition of Architectural Digest, you’ll want to make some changes. And those will add to the list of costs to sell a home.

Related: Selling a home: improvements to get top dollar

Most importantly, your home must be clean, sweet-smelling, tidy and uncluttered — inside and out. In other words, it must appear loved and cared-for. Chances are, some of those costs can’t be ducked, including those for cleaning, essential repairs, painting and adding color to your yard.

Staging

Staging is the process in which you consciously make your home as aspirationally attractive as possible to those who view it. Its goal is to achieve a version of the look you’ll see in those glossy magazines.

Related: How to stage your home yourself

You can pay thousands to a professional home stager. Or you can try to achieve something similar yourself. But there will still be some expenses that jack up how much it costs to sell a home.

Discount brokers and FSBO

The high commissions charged by real estate agents mean many sellers try to economize. And they can do that by offering their home FSBO (for sale by owner) or using a discount broker.

You should be aware that discount brokers can only offer their low rates by offering extremely limited services. So many will only list your home on the multiple listing service database — and nothing else.

Related: Discount brokers (Do they really provide a 1 percent rebate to buyers?)

Of course, that’s sometimes enough to get you the buyer you want. But that can be just the start. You’ll be left to negotiate the deal, possibly draw up the purchase offer (which must be legal for your state), progress-chase the transaction through its later stages and shepherd it all the way to closing.

Expect to spend many hours on desk research so you understand what’s going on at every moment.

Other costs

Whether you use a discount broker or go fully FSBO, you’ll almost certainly have some marketing costs of your own. For example, you may want to advertise, have a lawn sign, print flyers and spec sheets, host an open house with refreshments, stage the home ... There’s a long list of possible expenses.

Buyer’s closing costs

Sellers are rarely obliged to pay the buyer’s closing costs. But in some areas it’s customary to pay them in full or in part.

Related: How to buy a home (3 seller concessions that are better than a price cut)

And that means buyers in those places will come through the door expecting you to cover them. In other words, they’ll assume your asking price includes them.

You can either increase that asking price so it does, or try to negotiate all or some of the costs out while you’re haggling.

How high are the costs to sell a home? Sky high. True, if you’re prepared to put in the hours, you can likely reduce them somewhat. But the process is never going to be cheap.