Why you should understand the cost of selling a house
What is the cost of selling a house? That’s a question we get from a lot of clients, so if you’re not sure, you’re not alone. But it is information you should have before deciding to sell your home.
Understanding the true cost of selling a house can help you calculate your profit from selling. How do you calculate the cost of selling a house? Let’s start by looking at the categories of expenses when selling a house.
Real estate commissions in Ontario can range between 1 % and 7% of the sale price, but usually range between 3.5% and 6%. You can save these costs by selling without an agent, but you’ll lose out on having the backing of a professional who knows your market for pricing and their negotiating skills. Plus you’ll have to pay for things like photos, staging, and MLS fees yourself, which are often covered by the agent’s fee.
Real Estate Lawyer’s Fees
You can expect to pay between $500 and $1,500 for your legal fees when selling a home. The exact amount depends on the value of your home and the specific services required. Typically, this involves a title search, letter of direction, statement of adjustments, and the processing of funds on closing day.
If you have a mortgage on your home, you may need to pay penalties and discharge fees if you’re selling before your mortgage matures. Most banks allow you to apply the remaining mortgage balance to the mortgage of a new property, but some mortgages have restrictions. If you’re not buying a new home and transferring the mortgage, you may be on the hook for fees that can be thousands of dollars. Definitely talk to your bank or lender so you understand what you’re in for.
Repairs & Upgrades
The final cost of selling a house we’ll discuss are any repairs or upgrades you make to the house before listing. These expenses are often unavoidable (in the case of damages that must be repaired) or desirable (in the case of upgrades that will increase the value of your home). Either way, they are still costs associated with selling your home and you should consider them when making the decision to sell.
How Can I Reduce the Cost of Selling a House
If you’ve got some skills with power tools, you can DIY yourself some savings with repairs and minor upgrades. Leave those bigger projects to the pros, but choose upgrades that will give you the highest return on your investment. Have a green thumb? Doing your own landscaping can also save you money and give buyers a great first impression.
You can save money on moving costs by decluttering your space. This is also a great practice to get your house ready for sale anyway.
If you want a more specific estimate of the costs of selling your house or condo, give us a call. We can also help you delay some of those renovation costs with our Property Concierge program.