Tuesday, 7 March 2017

What is The Cost of Selling a Home? A Brief Analysis

The general mindset of every home seller is about asking the money right away after talking with a potential buyer for a few minutes. One major reason is that the sellers would already go for buying a home before selling the existing ones, and hence they are generally quite worried about proceeding with the further payments. If you, as a seller, are going through the same scenario, slow down and think about the money that wouldn’t go into your pocket. There are professionals who helped you in selling your property, and they are definitely going to get paid for that. With that said, the first question that may arise in your mind would definitely be about the cost of selling home.

For instance, the average commission that home sellers pay to the listing agents is 6% of the total cost of home. This amount might look bigger but there is a good reason for this commission to be totally justified.

Real estate agent’s commission

One big reason for the people to think about 6% commission as something that takes away everything from the seller is that they are not usually explained why they’re being charged this much amount.

This commission is usually divided between the brokerage of seller’s agent and that of buyer’s. This amount is further divided when amount is split between agents and the brokerage.

It’s worth mentioning here that most of the real estate agents do not have income sources other than the commission hey get. They also spend money on preparing documents and traveling without getting the money from anyone. And if the house is not sold after that entire process, those agents do not get any compensation for the costs spent on the case building.

Amount that sellers pay at closing
While buyers have to pay substantially at the closing, the sellers’ pockets do not stop getting depleted too. You can expect to pay 2% of the total home price at closing. It can be a fixed payment which is spent in the form of notary fees, escrow expenses and transfer taxes. The outstanding issues like water and sewerage bills and remaining mortgage payments can cost even more.

While many of the costs are inevitable, some costs can be controlled if your attorney has made an effective case document.

How is it to sell your home on your own?

While you have thought your way out in terms of saving money by not involving a real estate agent, you’d still have to pay the buyer’s agent’s brokerage.

According to David Nelson who is a real estate professional with Re/Max Advantage Plus, “Since over 93% of active buyers have a real estate agent representing them, it’s the only way to attract these agents—and thus their buyers—to even consider your home.”

Furthermore, there are a lot of costs that real estate agents can save you. They help you with the marketing of your home, paperwork, negotiations, legal protection, in-depth marketing knowledge, and provide access to other services related to real estate.

In the end, they would help you save the costs that you might not be able to save if you sell you your home on your own.

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