How Much Does It Cost to Sell a Home?
When it comes to the housing market, there are two things homeowners want to see more than anything – a high demand with a low supply. When those two conditions are met, it’s considered a ‘seller’s market.’
And if you’re looking to sell your home, there’s no better market to do it in than a seller’s market.
Of course, that’s why you see so many homeowners in New Jersey sleeping soundly at night. Buyers are desperate for a home that suits them and their family, but they don’t have many options to choose from.
Not only that, but current home prices are up 10.8% compared to last year, and the number of homes sold is down 14.9% year over year – all while homes spend four days less on the market, according to Redfin.
So, yeah – you could say right now is a pretty good time to sell a home in New Jersey.
If that’s something you’re considering, then you should take a moment to prepare yourself for what you’re getting yourself into – and that includes understanding the many costs that come with selling a home.
Don’t worry – we’ll teach you everything you need to know before selling your home.
Typical Costs of Selling a Home
When selling a home, most homeowners only concern themselves with one number (the home’s sale price), but there’s more to it than just that – especially when you factor in all the expenses of selling your home.
So, how much does it cost to sell a home?
As much as we’d love to give you a straightforward answer, there are simply too many factors that either drive up or minimize the amount of money you’ll have to cough up throughout the home-selling process.
From real estate commissions and fees to closing costs, mortgage payments, taxes, and the cost of moving you and your family to a new home – homeowners have a lot to consider when selling a home.
With that said, let’s take a closer look at some of the most common costs of selling a home in NJ.
1. Real Estate Agent Commissions
If you’re selling your home the traditional way, then you’ll be on the hook for your agent’s commission of the sale, as well as the buyer’s agent commission – which can be as high as 6% of the total real estate transaction.
For a $500,000 home, that expense can be as high as $30,000.
The good news is you can negotiate the commission with both agents – especially on a home with a high listing price. In some cases, you might only have to pay the fees for your own real estate agent, which would be about 3%.
2. Closing Costs
Both buyers and sellers will have several expenses related to closing the deal. While the home buyer usually absorbs a higher percentage of the costs, the seller still has a considerable amount of expenses.
In most cases, this can be as high as 3% of the final home sale price.
Closing costs may or may not include title insurance, recording and settlement fees, prorated property taxes, escrow fees, attorney fees, and any seller concessions. Again, some of these costs can be negotiated with the buyer.
3. Paying Off Mortgage
If you have a mortgage that you pay every month, it’s important to understand that the mortgage doesn’t just disappear when you sell a home. You’ll still be on the hook for whatever’s left of the mortgage.
For example, you’d owe the lender $150,000 if you’ve already paid off $350,000 of a $500,000 mortgage.
There are also several other factors that can drive up your mortgage payoff – such as a prepayment penalty (which some lenders add on to the final cost) and prorated accrued interest. Always check with the lender.
4. Taxes & More Taxes
Where money goes, taxes usually come with it – and that’s certainly the case when selling a home. The three most important taxes you’ll need to pay are property taxes, transfer taxes, and capital gains taxes.
You can speak with a real estate tax attorney for more info on taxes.
Property taxes are usually prorated, transfer taxes (which are different from a title filing fee) covers the cost of transferring ownership of the home, and capital gains taxes are due if you stand to profit a lot.
5. Moving Costs
If you’re selling your primary residence, then you’re probably going to have a lot of stuff that needs to be moved out before the new owners can move in. Unless you do all the work yourself, it’ll likely cost money.
This includes the cost of movers (if needed), storage space (if you need to store your belongings before moving into a new place), down payments on a new home, or security deposits for a new apartment.
Optional Costs of Selling a House
While the costs detailed above are expenses most homeowners will need to worry about when selling a home, there are several other common costs that are more of a hit or miss with most homeowners.
Let’s take a look at some of the optional and additional costs of selling a home in New Jersey:
1. Repairs & Renovations: the costs of repairs, renovations, and remodels will vary depending on how much work needs to be done. Not covering these costs almost always drives down your total profit.
2. Home Inspection & Appraisal: having your home inspected and appraised by a professional will give you a good idea of what’s wrong with the house and how much it’s worth in its current condition.
3. Staging the Home: while some real estate agents will include this cost in their service, others expect the homeowner to stage the home with furniture and increase the curb appeal of the home before selling.
Some homeowners will voluntarily cover these costs before listing the home on the market, while other homeowners will only cover them if the buyer asks them to. Of course, these costs add up fairly quickly!
NJ Cash Buyers: Avoid the Hassle & Sell Today!
Are you getting ready to sell your New Jersey home? Are you worried that the process might take too long – or cost too much? Are you worried that you might have to foot a bill that cuts too deep into profits?
If you answered ‘yes’ to any of those questions above, then don’t worry – we’ve got you covered!
Welcome to NJ Cash Buyers – where we buy houses for cash, and we can buy them in a hurry!
Our No. 1 goal is to make the home-selling process as easy as possible for you. If that means covering a majority of the closing costs and buying the house as-is, then that’s what we’re prepared to offer you.
Please don’t hesitate to contact us today at (973) 791-6510 to receive your free, no-obligation cash offer!
selling your home.