By, Lisa Roberts
When you're selling your home, your mind usually focuses on where to move and what kind of profit you'll achieve from selling it. And if it's your first time selling, you're probably anxiously waiting to learn just how much money you'll have in your pocket at the end of everything. So, if you want to plan everything correctly, you need to find out more about the unexpected costs of selling a home.
What many homeowners and sellers don't understand is that this process is neither free nor cheap. If you have thought about all the resale value factors to consider before buying a home, you can earn a lot. That is a thing no one disputes. However, you'll have to spend some money along the way no matter what. And here's where that money is going to go.
The first thing on our list can seem a little strange, but it's totally justified. You see, it's recommended to keep the utilities running all the way to the very last day before closing on the sale. There are a couple of reasons for this.
- Your real estate broker will be able to demonstrate that the home is fully operational.
- This can help prevent other issues that can appear.
For instance, if you want your home to stay mold-free during those humid summer days, you need to keep some lights and A/C on. The humidity must never exceed 70%, as this is where the mold thrives. Another example is shutting down the water. Your lawns won't look nice without any watering, and that can send a wrong message to potential buyers.
We understand that awaiting the arrival of a reliable moving company like goodneighborsmoving.com and relocating to a new house is exciting. But you mustn't forget about your old home either.
You want your potential buyers to picture themselves living in your home and spending time around it, and for that, you need beautiful lawns. Alt tag: Family playing on a lawn and talking about unexpected costs of selling a home.
Repair and renovation costs
There's a lot you can do to increase the appeal of your home. A fresh coat of paint, a thorough carpet clean, and a new toilet in the master bathroom can go a long way. However, you have to make sure to budget for doing these things before you put your home on the market.
If you address any issues early, you can save quite a bit of money. Also, this will increase your chances of passing a home inspection on the first try. It's worth mentioning that there are many tips to enhance curb appeal that can be done on cheap. So, don't be scared to get your hands a little bit dirty in this phase.
Digital staging costs
To get the best deal you can get, you want the maximum exposure of your property for potential buyers. And for that, you'll have to take great photos and descriptions available online.
Luckily, in today's day and age, this is not a real problem. Your agent will probably be able to outsource digital staging services from a third party for you. These people are usually capable of fully staging your home, so now is an excellent time if you haven’t done it already.
The average amount of money owners spend is around $2,000. However, prices can range anywhere from a few hundred to as much as $5,000. The more bells and whistles you request, the more you'll pay for. That's why this is on the list of unexpected costs of selling a home.
These days 360-degree picture or video walk-throughs seem to be a massive hit. Therefore, you can definitely score if you have one. But, before you arrange shooting, you should empty the house. This is the easiest thing in the world if you're already moving. However, even if you aren't, you can rent storage and arrange a unit so all your items can fit and make your house a clean sheet of paper for a day.
If you want your home to appear in the best shape online, you have to get over one of the unexpected costs of selling a home, which is hiring a professional photographer. Alt tag: Man looking setting up his camera.
Now, you'd think that people are aware that real estate agents are paid on commission and that they know what that means. They usually get 5 to 6 percent of the home's agreed-upon selling price. This is about $18,000 on a $300,000 home. Although this amount is split between the seller's agent and the buyer's agent, it comes only from the seller's side of the deal.
Know that real estate agent commissions are negotiable, so you don't have to accept the first offer you get. However, if the seller pushes too hard on this point, that can make their home unattractive to the buyer's agents. In other words, if you agree on a commission that is too low, you may end up reducing traffic and potential buyers.
Capital gain taxes
If you took advantage of all the benefits of a mortgage stimulus while owning a house, you must know that there are many ways to cut down your tax bill. However, there's still a chance that you'll have to pay Uncle Sam a share from your home sale.
If you owned the home for at least two years and had used it as your primary residence for five years before the date of closing, you can receive an exemption for up to $250,000 of the gain of your sale. The trick here is to fill everything jointly if you're married. This way, you can get all the way to $500,000, which will keep you safe in most cases.
If you're in a lucky group whose capital gains exceed these limits due to the hot market, you'll need to pay applicable taxes.
Check if you fulfill all the requirements for getting an exemption on paying taxes on capital gains. Alt tag: A woman going through her taxes.
The bottom line
As you can see, it's easy to fall into the trap of thinking that you'll make more money than you really are going to. However, now you know all the unexpected costs of selling a home that you're going to encounter. Therefore, you can prepare for them and arrange that everything fits in the budget.
Meta: Find out what the unexpected costs of selling a home are. Learn where a part of your money will go and how you can save more of it.