Selling a house involves various expenses that can significantly impact a homeowner’s net profit. Knowing the average percentage cost to sell a house helps sellers plan their finances and set realistic expectations. On average, sellers incur costs ranging from 6% to 10% of the home’s sale price. These percentages cover real estate agent commissions, closing fees, taxes, and other miscellaneous expenses.
| Cost Component | Typical Percentage of Sale Price | Description |
|---|---|---|
| Real Estate Agent Commission | 5% – 6% | Paid to buyer’s and seller’s agents, usually split roughly equally |
| Closing Costs | 1% – 3% | Fees for title insurance, escrow, attorney, and transfer taxes |
| Home Repairs and Improvements | 1% – 3% | Pre-sale repairs or upgrades to attract buyers |
| Staging and Marketing | 0.5% – 2% | Costs for professional staging, photography, and advertising |
| Mortgage Payoff Penalties | Varies | Possible penalties for early loan payoff |
Real Estate Agent Commissions: The Largest Seller Cost
Real estate commissions represent the most significant expense when selling a house. Typically, commissions range from 5% to 6% of the sale price and are paid to both the seller’s and buyer’s agents. The commission is usually split equally between agents but can be negotiated in some markets. This cost covers their services, including marketing the property, finding buyers, handling negotiations, and managing paperwork.
While some sellers attempt to save money by not using agents or negotiating lower commissions, it’s important to weigh these savings against the benefits agents provide. Experienced agents often secure higher sale prices that can offset the commission cost.
Closing Costs: Fees and Taxes to Consider
Closing costs vary by state and transaction but generally fall between 1% and 3% of the home’s sale price. These costs include:
- Title insurance fees: Protects buyer and lender against title disputes.
- Escrow fees: Charges for the third-party service that manages funds.
- Attorney fees: Required in some states to review legal documents.
- Transfer taxes: Taxes imposed by local or state governments on the sale.
It is common for sellers and buyers to negotiate which party pays specific closing costs. Sellers often pay a larger share of these fees, but some buyers may agree to cover or split the costs depending on market conditions.
Home Repairs and Improvements Before Selling
Many sellers invest in repairs and upgrades to increase their home’s market appeal. The average expenditure ranges between 1% and 3% of the sale price but can vary widely based on home condition and market expectations.
Common seller-paid repairs include fixing leaks, updating kitchen fixtures, repainting walls, landscaping, and addressing safety issues. While these costs add upfront expenses, well-targeted improvements often lead to faster sales and higher offers.
Staging and Marketing Costs
Marketing the property involves expenses that range from 0.5% to 2% of the sale price and cover:
- Professional staging: Furniture rental and decor to appeal to buyers.
- Photography and videography: High-quality images and virtual tours.
- Advertising: Online listings, print ads, open house events.
Effective staging and marketing help properties stand out in competitive markets, which can justify these costs as an investment in attracting qualified buyers.
Mortgage Payoff Penalties and Additional Considerations
Some mortgage agreements include penalties for early loan payoff, which can affect the total costs to sellers. The terms vary widely, with penalties ranging from a small flat fee to several months’ worth of interest.
Additionally, sellers may encounter miscellaneous costs such as:
- Home warranty credits offered to buyers.
- Property taxes prorated up to the sale date.
- HOA fees if applicable.
Average Cost to Sell a House by Sale Price Range
| Sale Price Range | Typical Total Seller Cost (6% – 10%) | Estimated Dollar Amount |
|---|---|---|
| $150,000 – $250,000 | 6% – 10% | $9,000 – $25,000 |
| $300,000 – $500,000 | 6% – 10% | $18,000 – $50,000 |
| $600,000 – $1,000,000 | 6% – 10% | $36,000 – $100,000 |
| $1,200,000 and above | 6% – 10% | $72,000 and up |
Factors Influencing the Total Selling Cost Percentage
The actual percentage cost to sell a house depends on various factors such as:
- Location: Some states have higher transfer taxes or mandatory attorney fees.
- Market conditions: In a seller’s market, sellers may negotiate lower agent commissions or pass on closing costs to buyers.
- Home condition: Older or distressed properties typically require more repair expenses.
- Selling method: FSBO (For Sale By Owner) can reduce commission costs but may increase marketing and legal fees.
Tips to Minimize Selling Costs
- Negotiate commissions: Discuss with your agent potential commission reduction, especially in hot markets.
- Limit unnecessary repairs: Prioritize fixes that add the most value or are required for sale approval.
- Shop for services: Compare multiple title companies, inspectors, and attorneys for better rates.
- Consider pre-inspections: Identify issues early to avoid surprises and possibly faster closing.
- Review mortgage terms carefully: Avoid loans with high early payoff penalties.