Selling a home is a huge milestone in anyone’s life. However, many sellers are unaware of the costs of selling a house. While buyers evidently pay more during the real estate transaction, there are a couple of expenses that sellers need to pay, as well. These costs vary from the home repairs needed before the house goes on sale to the real estate agent’s commission. They also depend on your location and the home’s purchase price, among other factors. As a home seller, it’s crucial to be well-prepared for the sale of your home. Knowing how much you may be spending will make the home selling process a smoother and faster one.
Buyers aren’t the only ones who need to shell out money during a real estate transaction. Home sellers are also required to pay for certain costs such as home repairs, capital gains tax, and real estate agent commissions.
Here are the home selling costs that you need to be aware of:
- Home repairs
Making the necessary home repairs is an essential step before putting your home on the market. Simple repairs such as fixing holes or cracks in the ceiling and walls, changing old light fixtures, and repairing leaky faucets can make a positive impact on potential buyers. Depending on what you plan to repair, the costs may vary from $100 to $1,000.
- Home cleaning
Cleaning the home from top to bottom is important, as well. The windows, kitchen, living room, and bathrooms are just some of the areas that must be cleaned thoroughly. If you plan on hiring a professional cleaning service, the cost averages between $125 and $225. This is based on the size of the home and the number of hours spent cleaning.
- Painting the interiors
If you want to give your home a new and clean look, painting it is the way to go. Neutral colors for the interiors such as light beige, grey, white, and their other variations give a great first impression. Moreover, these paint jobs can increase the overall value of the home. As for the cost, this project ranges from around $963 to $2,740.
- Home staging
Staging your home is a great way to entice buyers and sell your home faster. According to a 2019 home staging study by the National Association of Realtors, 83% of buyers’ agents said that a staged home helped their clients envision the property as their future home. Hiring a professional home stager costs anywhere from $500 to $2,400.
- Landscaping
Curb appeal makes a huge difference when selling a home. The way your home looks on the outside can mold a potential buyer’s first impression and even raise your home’s value. Landscaping costs depend on the scale of the task and the number of landscapers needed. Minor landscaping tasks are around $300 to $800 while major landscaping jobs can reach around $2,000 to $4,000.
- Pre-sale home inspection
A pre-sale home inspection is a step that many sellers take to improve their pricing, marketing, and negotiating strategies. Through this, sellers can find out about their home’s current condition, HVAC systems, appliances, and many more. Pre-sale home inspections can cost around $300 to $400 or more.
- Capital gains tax
Sellers who earned more than $250,000 on the sale of their home (double the amount for those who are married and filing jointly) must pay capital gains tax. There are three rates depending on your tax bracket: 0%, 15%, and 20%. However, this tax can be reduced or avoided, provided that the home is your primary residence and that you keep track of your home improvements and additions.
- Transfer tax
A real estate transfer tax is a fee imposed on the transfer of your home’s deed to its new owner. This transfer tax varies by state, city, and county. In Chicago, for instance, the real estate transfer tax is a flat rate of 1%.
- Owner’s title insurance
To protect the buyer’s equity in the property, sellers must also pay for owner’s title insurance. Buyers, on the other hand, must pay for the lender’s title policy. Owner’s title insurance is around 1% of the purchase price.
- Closing costs
While closing costs are typically paid by the buyer, the seller may also be asked to pay for these costs. These closing costs include property taxes, attorney fees, homeowners’ association fees, escrow fees, and brokerage fees. Closing costs are generally around 2% to 5% of the purchase price.
- Moving costs
After closing on the sale of your house, it’s time to start moving. Hire a professional and reliable moving company. You’ll also need to purchase moving supplies such as boxes, packing tape, bubble wrap, and more. These costs can amount from $562 to $1,554, depending on where you’re moving and the number of items you’re bringing with you.
- Real estate agent commissions
And lastly, sellers are also responsible for the real estate agent’s commission, which is usually 5% to 6% of the home’s sale price. This amount is then split between your real estate agent and the buyer’s agent.
List your property for sale in Chicago with the help of 606 Brokers, the number one real estate brokerage in Chicagoland. Our extensive knowledge of the Chicago real estate market makes us the go-to team for all your home selling needs. Get in touch with us today by calling 773.870.5101.
References:
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https://www.bankrate.com/real-estate/how-much-does-it-cost-to-sell-house/
https://www.nolo.com/legal-encyclopedia/homeseller-checklist-expenses-when-selling-36253.html
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