The decision to list your home for sale involves much more than just listing it. Along with a finding an agent that fits your needs, you need to consider the financial matters involved. You understandably need to research the estimated sales price you may receive for your home as well as the mortgage payoff value. While this will give you a fair approximation of your net proceeds from the transaction, you also need to focus on closing costs. Closing costs are a large expense that you need to include in your estimate. By reviewing the primary costs associated with selling a home, you can better determine your net proceeds from the transaction.

Preparing to List the Home

Most homes are not immediately ready to list for sale, and some make-ready, improvements, and staging may be needed. Common steps homeowners take involving repainting the interior walls, improving the landscaping, completing known repairs to the home and buying home décor for staging purposes. Depending on the condition of your home, on the low end, you may expect to pay a few thousand dollars on this aspect of the selling process. On the higher end, it is reasonable to pay $10,000 or more on it. Keep in mind that these are up-front costs rather than costs paid through the proceeds from the sale of the home.

The Real Estate Agent Commissions

The seller customarily pays for the real estate agent commissions for both the seller’s and buyer’s agents. Usually, each agent receives a 2.5 percent commission, but this is negotiable. This means that the seller may pay an additional five percent of the sales price to the real estate agents. For example, on a $300,000 home, the seller may pay $15,000 in agent commissions. This fee is paid for through the net proceeds from the transaction at closing.

Smoke Certificate

In order to sell your home in Massachusetts, a certificate of compliance will be required from the town Fire Department at the closing. This cost varies by town but can range anywhere from $25-$100. If your current detectors are not up to code then you will also need to purchase new detectors which can cost upwards of $60 per detector which are needed on every level.

Stamp Tax/State Excise Tax

In Massachusetts, you are required to pay $4.56 in tax for every $1,000 of the sales price of your home. Therefore if you are selling a home for $1,000,000 you will end up owing $4,560 in taxes.

Closing Costs

The seller may have to pay a prorated amount of property taxes on the home, and this could equate to several thousand dollars or more. The seller may also be responsible for paying for the preparation of a new deed and other closing costs that the buyer has negotiated for. Legal fees are another cost that sellers will likely need to pay for and should be factored into the calculation of anticipated net proceeds.

When you are trying to decide whether to sell your home, it is important to understand what your estimated sales price and mortgage payoff balance figures are. This information can help you to determine if you can afford to pay all of these fees or if you may need to come out of pocket to pay some of them. Remember that some of these fees are negotiable. The final cost of closing largely depends on the sale price of your home.

When you list your home with Andersen Group Realty, we are here for you every step of the way to ensure your home selling process fits your specific needs. Contact us today for more information.