It costs around $31,869 to sell an average-sized house in the United States, which is a very rough estimation based on a plethora of factors.
Selling a house usually means making money, but there are quite a few expenses that sellers need to account for before selling a home.
In this guide, we’ll assume that we have a priced home that you want to sell and explain all the factors that can take effectively chip away your listed sale price.
Key Takeaways
- Selling a home costs about $31,869, influenced by various factors.
- Key expenses include repairs, inspections, agent fees, closing costs, and staging.
- Hidden costs like mortgages, taxes, and seller concessions may reduce net profits.
- Costs vary based on home size, location, and specific sale conditions.
Table of Contents
How Much Does Selling a House Cost You?
Before we continue, note that we’ll give you the average estimate of the expenses that you “may” have to deal with.
However, that doesn’t mean you’ll have to deal with every single expense we’ll list, so keep in mind that your average will likely be less than our estimate since ours will include all the possible factors.
We’ll also assume that you’re selling a home for $404,500. That’s a property’s sale price on average, as of September 2024, according to Bank Rate. Size-wise, we’ll assume it’s 2,299 sq. ft. (once again, the average in the country).
That being said, here are the costs you might face:
1. Home Repairs and Improvements
Selling a home means having it in its best shape to make it appealing for a buyer, which means it may need renovations or remodeling, depending on the extent of the wear and tear.
Renovations can cost as low as $20,000 or, if there’s extensive damage, go over $300,000. In square feet, that’s a range of $25 to $150 per sq. ft.
Assuming you need to renovate only 20% of your 2,299 sq. ft. home at a $35 cost per sq. ft., you’ll pay $16,093 for renovations. (Cost per sq. ft. * Area to be renovated = $35/sq. ft. * 459.8 sq. ft. = $16,093).
As for remodeling, its average is a bit higher than renovation (starting from $35+) and goes up with the space you decide to remodel.
As we did with renovations, we’ll add $10 per sq. ft. to the minimum of $35 to make it 45$, bringing the total cost of remodeling 20% of a 2,299 sq. ft. house to $20,691.
Taking the mean between $16,093 and $20,691, we get $18,392. That’s the average cost for home repairs and improvements.
2. Pre-listing Home Inspection
A pre-listing inspection is a measure taken by some sellers to assess the condition of the property before it’s officially listed for sale.
Fortunately, this type of inspection doesn’t cost much, typically a few hundred dollars between $300 and $500.
Adding the mean between this range ($400) to our $18,392 brings our selling cost now to $18,792.
3. Real Estate Agent Commissions
If you’re utilizing the services of real estate agents, expect to pay them a decent sum.
While prices can significantly vary, we typically look at 5% to 6% of the total cost of the house. The higher your sales price, the higher their fees.
In our $404,500 example, that means $2,025 to $2,430, which has an average of $2,227.
This might be a hefty sum for some people, but if you’re a busy person who needs every bit of time they can save, $2,227 can be a good investment.
Our total selling cost now is $21,019.
4. Closing Costs
Closing costs are various fees and expenses incurred during the finalization of a real estate transaction.
Typically, buyers are the ones who pay the most of the closing costs, but this doesn’t mean that sellers are completely off the hook.
Closing costs can significantly vary based on the location, but on average, they are anywhere between 2% and 5% of the property’s value.
This percentage includes various items like appraisal fees, title insurance, taxes, attorney fees, and so on.
Mortgages can also affect closing costs a great deal. For example, a mortgage of $400,000 can result in closing costs between $6,000 and $18,000.
It’s a little hard to put even an estimate on this one, but assuming you’re the seller, you’ll pay the lesser part of the closing costs, so we’ll settle for 1% of the property’s value, which is $4,045.
Adding everything up so far, we’re paying $25,064 to sell our $404,500 example house.
5. Home Staging Costs
Home staging costs are the expenses associated with preparing a home for sale to make it more appealing to potential buyers.
These costs can vary based on several factors, including the size of the home, its location, and the specific staging services required.
On average, home staging in the United States ranges from $1,500 to $4,000 (a mean of $2,750) for a whole-home staging.
This price typically includes furniture rental and decor for the first month. For vacant homes that require significant furniture rental, costs can go up a little, pushing the range between $3,000 and $6,000 (a mean of $4,500).
Assuming that your house is a middle ground between both, then we’ll take the average of both, which is $3,625. Adding that to our expenses so far, we get $28,689.
6. Moving Costs
Moving costs aren’t directly associated with selling a property, and this expense won’t apply if you’re not actively living in said property.
However, if you’re moving out from the house you’re selling, this section will help you avoid the mistake that 37% of Americans made while moving in 2023. Since this cost isn’t associated with the sale, many people fail to budget it correctly.
To do said budget properly, you need to select your moving distance among the following three options:
- Local moves: These cost an average of $1,250 to $1,691 for a move of approximately 100 miles.
- Long-distance moves: The average here is about $4,890 for a move of around 1,000 miles.
- Cross-country moves: Costs here significantly vary and can exceed $10,000, so we won’t include it in our calculation.
By taking the average of local moves ($1,470) and adding it to the long-distance average, we get $3,180.
Adding that to our cost up to this point, we get $31,869. That’s roughly how much it costs to sell our $404,500, 2,299 sq. ft. example house in the United States.
In other words, after you pay everything, your net profit will be $372,931.
Note: Some additional costs may or may not apply to you, but they’re often hidden from most people.
We suggest you read our Real Estate Loopholes for Doctors Involved In Real Estate Investing guide to learn other relatively unknown strategies that physicians can use.
Hidden Additional Costs for Home Sellers
Mortgage Payoff
If you still have an outstanding mortgage on your home, you’ll need to pay off the remaining balance at closing. This amount is typically deducted from the proceedings of your home sale.
Capital Gain Taxes
There’s a significant advantage for homeowners in the United States that can exempt them from a good amount of taxes. Single sellers can exclude up to $250,000 of capital gains from their taxable income, while married couples filing together can exclude up to $500,000.
If your capital gain exceeds these amounts and you’ve owned the home for more than a year, you may be subject to long-term capital gains taxes. These rates can vary from 0% to 20%, depending on your income level.
Seller Concessions
We’ve already talked about one of the seller concessions, which is when sellers agree to pay a portion of the buyer’s closing costs.
There’s another type of seller concession called the mortgage rate buydown. Here, the seller pays a sum of money to reduce the buyer’s interest rate on their mortgage, which can make the deal more attractive to buyers.
A Few Extra Words
The information mentioned in this guide is useful, but can easily become harder to apply if your individual situation is too different from the conditions listed above.
Things can get a lot more complicated based on your profession, too. For example, if you’re a physician, you have other aspects of student loans and expenses to worry about.
You can hit both birds with one stone if you collaborate with Physicians Thrive. Contact us, let us know of your specific condition, and we’ll handle everything else.
