How Much Does it Cost to Sell a House?


|10 min read

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cost to sell a house

If you’re considering selling a house, your first question is likely the value and how much someone will pay for it. But many homeowners don’t think about the costs of selling a home. There are fees for selling a house. Some expenses you can negotiate or pass on to buyers, depending on the market. But in the end, some costs and fees fall on the seller. 

Here is a summary of the fees you can expect and how much it usually costs to sell a house.

How much does it cost to sell a house?

In general, total closing costs for sellers are usually 7-10% of the home sale price. This can include:

  • Real estate agent commissions: Usually covered by the seller, this is the fee to pay for the realtors’ services and can range between 5-6%
  • HOA Transfer taxes: Sometimes covered by the seller, this is a fee to transfer the HOA fees from the seller to the buyer, and the cost can vary.
  • Title Insurance: Usually paid for by the buyer but can be on the seller in some states, this is the lender’s title insurance policy, and costs can vary.
  • Escrow fees: Usually split between the buyer and the seller, these cover paperwork and the exchange of funds, and costs vary wildly depending on the state.
  • Attorney fees: If you choose to work with an attorney, these costs would fall on you and vary.
  • Home repairs: Can be paid by the seller depending on negotiations; this would cover anything that comes out of the inspection that the seller agrees to fix before closing. The total cost can obviously vary depending on the scope of the repairs.

The average home in the US sold for around $543,600 in 2022. This is a big jump from 2020 when the average home price was about $391,900.

This means that an average home seller pays between $38,000-$54,000 in fees for selling a house. That is a lot of money. But remember that the seller controls the asking price and the sale price they choose to accept. The fees should be considered when deciding how much to list a home.

How much are realtor fees for a seller?

The most significant chunk of the closing costs for a seller goes to the real estate agents. The average commission is between 5-6% for real estate agents. The seller is usually responsible for paying their agent and the buyer’s agent. 

The total fee split between the two agents is 5-6% of the home price. Realtor commissions pay for marketing, open houses, home pictures, and other time an agent spends on getting your home sold.

The agent’s commission covers house hunting, showings, negotiations, and other expenses on the buyer’s side.

Real estate agent fees are negotiable and should be discussed before entering into a contract with an agent. It’s important to remember that you get what you pay for when it comes to agent fees. Getting a discount sounds great. When you’re in the middle of negotiations and can’t reach your agent, you’ll wish you had spent the extra money. 

How much are closing costs for a seller?

All possible fees associated with selling a home generally add up to between 7-10% of the home selling price. This money covers many things but mostly goes to the seller’s and the buyer’s real estate agents. So let’s break it down a little more.

HOA Transfer Fees

Many homes are in neighborhoods that are overseen by an association. This is typically a group of homeowners in the neighborhood who volunteer to be in a team that helps maintain neighborhood common areas, enforce rules, get neighborhood projects done, and plan events.

When you sell your home in that neighborhood you will pay a fee that essentially transfers your membership to the next owner. This is typically a $200 to $250 charge.

Title Insurance

Title insurance is an insurance policy that protects real estate owners and lenders from financial loss due to defects in a property’s title. A property’s title is its legal ownership, including information about past ownership, liens, and other costs or issues with the property.

These issues include:

  1. Ownership disputes: If someone else claims to own the property you are trying to sell, title insurance can cover legal expenses and financial loss.
  2. Liens or encumbrances: If there are any liens or other claims on the property, title insurance can help cover the cost of resolving these issues.
  3. Forgeries and fraud: If any fraudulent activities were committed during the property’s ownership history, title insurance can help protect the owner or lender from financial loss.

Title insurance policies are typically purchased during the property’s purchase and would remain in effect as long as the purchaser owns the property.

fees for selling a house

Escrow Fees

Escrow fees are fees an escrow or a title company charges for facilitating a real estate transaction.

Escrow companies are neutral third parties that hold and manage funds and documents during a real estate transaction. They do this until all parties meet the contract terms and the transaction is finished.

Escrow fees vary depending on location and the amount of the home sale. They typically range from 1% to 2% of the property’s total purchase price. These fees cover the costs of the following:

  1. Opening and managing the escrow account: This includes tasks such as reviewing contracts, ordering title reports, and preparing the settlement statement.
  2. Holding funds: The escrow company will hold the buyer’s deposit and any other funds required for the transaction, such as closing costs and prorated property taxes.
  3. Disbursing funds: Once all the contract terms have been met, the escrow company will pay out the funds to the appropriate parties.

Attorney Fees

Using a real estate attorney when selling a house isn’t usually necessary. However there are some circumstances when it is advised. This is during complex or high-value transactions to ensure that your legal rights are protected and that the transaction proceeds smoothly.

Here are some situations where you may want to consider hiring a real estate attorney:

  1. You are selling a property with legal or title issues: If there are any liens, encumbrances, or disputes related to the property’s ownership or title, a real estate attorney can help you resolve these issues and ensure that the sale can proceed legally.
  2. You are selling a property with tenants: If the property you are selling has tenants, a real estate attorney can help you navigate the landlord-tenant laws in your state and ensure that the sale complies with these laws.
  3. You are selling a property as a part of a divorce settlement: If you are selling a property as part of a divorce settlement, a real estate attorney can help you navigate the legal issues related to the division of property and ensure that the transaction is fair and equitable.

It’s never a bad idea to talk with an attorney. They can provide valuable advice and representation throughout the selling process. However, many times they are not necessary.

Attorney costs can vary widely based on the complexity of the situation and the value of the property involved.

Selling a Home Costs Money

When buying a home, many costs are associated with closing. Buyer closing costs include lender fees, inspection, appraisal, and applicable taxes and insurances.

Sometimes a seller will make concessions and cover some of the closing costs charged to the buyer to make the sale. This is a case-by-case basis and up to the seller how much they want to offer a potential buyer. 

There is a limit to the amount of closing costs a seller can pay depending on the loan type. The seller’s concession can not exceed the buyer’s closing costs.

Even though the idea of selling a home can sound like only money coming in, there are fees associated with it. Many people assist with the sale of a home, and because of this, there are fees for selling a house and commissions that fall on the seller.

If you’re ready to take the next step in your home selling journey, the best thing you can do is talk to an experienced, licensed real estate agent. The top agents know the market and how to set your listing price, so closing fees don’t hurt your bottom line.

Steph Matarazzo FastExpert Inc

Steph is the Marketing Director at FastExpert and has been working in the real estate data and research world for over three years. She is passionate about educating people on the real estate market and Excel spreadsheets. She lives on the East Coast with her family and recently purchased her own home.

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