The Ultimate Guide to Closing Costs for Sellers
The Ultimate Guide to Closing Costs for Sellers Master your home sale finances and keep more money in your pocket with strategic cost management When selling a home, closing costs can reduce your profit significantly – typically ranging from 6% to 10% of the sale price. For a $400,000 home, that’s between $24,000 and $40,000. These costs include real estate agent commissions, transfer taxes, title insurance, property taxes, and settlement fees. Knowing these expenses upfront helps you budget, negotiate, and keep more of your proceeds. Key Takeaways Agent Commissions: Often the largest cost, averaging 5%–6% of the sale price. Transfer Taxes: Varies by location, starting around $250 but can exceed $1,000. Title Insurance: Typically 0.1%–2% of the sale price. Settlement Fees: Range from 3%–6%, covering administrative tasks. Tips to Reduce Costs 1 Negotiate Agent Fees: Many sellers overlook this, but it can save thousands. 2 Shop for Title/Escrow Services: Comparing quotes can lead to better rates. 3 Review Closing Documents: Catch errors or unnecessary fees before finalizing. Pro Tip: Consider flat-fee MLS services or reduced commission options like HomeRise, which offers packages starting at $95 or a 1% agent network to maximize your savings. Seller Closing Costs Explained: Save $$$ By Doing This Main Types of Seller Closing Costs Knowing what to expect in closing costs can help you budget wisely and even find ways to cut back on expenses. Below, we’ll break down the primary costs sellers face at closing and highlight areas where you might be able to save. Real Estate Agent Commissions For most sellers, real estate agent commissions are the biggest closing cost, typically accounting for 5% to 6% of the home’s sale price. This fee is usually split between the listing agent and the buyer’s agent, with each receiving about 2.5% to 3%. $20,000 Average commission on $367,700 home 5.44% Current average commission rate 19% Sellers who negotiate lower rates To put this into perspective, on a home selling for $367,700 with the current average commission rate (5.44%), you’d pay around $20,000 in commissions. Combined with other fees, your total closing costs could reach 8–9% of the sale price. Recent changes by the National Association of Realtors (NAR) have shifted how commissions are handled. Buyer’s agent fees are no longer automatically included in the seller’s listing agreement, meaning buyers may now need to cover their agent’s commission themselves. Transfer Taxes and Title Insurance Transfer taxes and title insurance costs vary widely depending on where you live and your property’s value. Transfer taxes are government fees charged when property ownership changes hands. These fees typically start at around $250 but can climb to $1,000 or more depending on local laws. Cost Breakdown Examples NYC Transfer Tax 1% – 1.425% + 0.4% state fee Title Insurance 0.1% – 2% of sale price Title Search $75 – $200 Property Taxes and Settlement Fees You’ll also need to settle your portion of property taxes up to the closing date. For instance, if you close mid-year, you’ll owe taxes for the months you owned the home, while the buyer will take over from the closing date onward. Settlement fees, which cover administrative costs like document preparation and fund transfers, are another expense to account for. These fees are charged by title or escrow companies to manage the closing process. Shopping around can make a difference here. Many title and escrow companies are open to negotiating their fees, which can range from 3% to 6% of the home’s sale price. Comparing quotes from several providers could save you hundreds of dollars. How to Lower Your Closing Costs Closing costs don’t have to be a fixed expense. With the right strategies, you can reduce these fees and keep more of your earnings from the sale of your home. Here are three practical ways to cut down on closing costs. Negotiate Agent Commissions Did you know that real estate commissions aren’t set in stone? In fact, they’re legally required to be negotiable. Yet, only 22% of sellers actually manage to lower their fees. That means many homeowners miss out on a chance to save. “By law, real estate brokerage fees are negotiable.” – Rick Smith, Director of the California Association of Realtors Today’s market conditions work in your favor. Nearly half of agents (47%) expect buyer’s agent fees to decrease by 2025, and 34% believe listing commissions will also drop. According to Trent Seigfried, a Data Analyst at Clever Real Estate, “Current market conditions provide a great chance to negotiate commission rates”. Compare Title and Escrow Companies Shopping around for title and escrow services can save you hundreds – or even thousands – of dollars. Many sellers don’t realize they have a choice here, but the Real Estate Settlement Procedures Act (RESPA) gives you the right to select your own title company. Independent title companies often charge less than those affiliated with larger organizations. To find the best deal, request quotes from multiple providers. Don’t just focus on the base premiums – compare the total fees. Check Settlement Statements for Mistakes Your settlement statement is essentially a roadmap of your closing costs, and reviewing it carefully can save you from paying unnecessary fees. Make sure to go over the document at least 24 hours before your closing appointment. Look for duplicate charges, incorrect fees, or anything that seems off. Mistakes to Avoid When Handling Closing Costs Not Accounting for All Closing Costs Focusing solely on the obvious expenses can leave sellers blindsided by the full scope of closing costs. These unexpected costs can add up quickly, creating financial headaches. It’s easy to underestimate or forget about smaller fees, but these can create shortfalls at the closing table. Beyond major expenses like agent commissions, minor charges – such as transfer taxes or escrow fees – can pile up. Overlooking Opportunities to Negotiate Closing costs aren’t set in stone, and failing to negotiate can result in higher expenses. For example, comparing Loan Estimate forms from different lenders can help you identify and
5 Best Home Staging Tips That Actually Work
5 Best Home Staging Tips That Actually Work | HomeRise 5 Best Home Staging Tips That Actually Work Proven strategies to sell your home faster and for more money When selling your home, staging can make a huge difference in how fast it sells and for how much. Staged homes sell faster and often sell for 5–15% more. The good news? You don’t need to spend a fortune to stage effectively. 23 Days on market(staged homes) 184 Days on market(unstaged homes) 15% Higher sale price(potential increase) 1 Declutter and Depersonalize Create an open, inviting space where buyers can easily picture themselves living. Clear out clutter that makes rooms feel cramped and remove personal items that might distract buyers. The 80/20 Rule Keep your home about 80% furnished while leaving 20% of the space visually open for a cleaner, more spacious feel. Key Areas to Focus On: Kitchen countertops – store away appliances like toasters and food processors Bathrooms – remove personal items like toothbrushes and toiletries Bedrooms – swap personal photos for neutral artwork Storage spaces – organize closets and cabinets to showcase potential Cost: Minimal – primarily involves using what you already have with only small expenses for storage bins. 2 Deep Clean and Refresh A sparkling home not only leaves a great impression but also reassures buyers that the property has been well cared for. This step goes beyond your usual tidying routine. Impact on Sale Price Homes receiving professional cleaning sold for an average of 5% above asking price, while uncleaned homes sold for 3% below asking price. Priority Cleaning Areas: Kitchen appliances (inside and out) – refrigerator, oven, microwave Bathrooms – scrub toilet, polish fixtures, refresh grout lines Windows – clean inside and out to maximize natural light Carpets – vacuum thoroughly and remove stains Eliminate odors – 80% of buyers are turned off by strong smells Time Required: 3-7 days for a complete deep clean, depending on home size. 3 Optimize Furniture Layout Arrange your furniture to highlight the room’s potential and make spaces feel larger. A well-thought-out layout improves movement through the home and helps buyers imagine themselves living there. Professional Tip “You don’t want your house to look like a bowling alley, so stop placing everything against the wall.” – Shirin Sarikhani, Seattle Staged to Sell & Design Layout Guidelines: Float furniture slightly away from walls to create openness Maintain 36-inch pathways (42-48 inches in main hallways) Keep coffee tables 12-16 inches from sofas Arrange seating to encourage conversation Don’t block windows – emphasize natural light Cost: Free – simply rearrange what you already own. 4 Improve Lighting and Ambiance Proper lighting makes rooms look larger, highlights key features, and creates a warm, inviting atmosphere. Studies show people are 12% more likely to make purchases in well-lit spaces. LED Bulb Benefits LED bulbs are 90% more efficient than incandescent bulbs and can save up to $81.68 over their lifespan at just $4 per bulb. Lighting Strategy: Ambient lighting: General lighting for the entire room Task lighting: Focused lighting for specific areas Accent lighting: Decorative touches for architectural details Quick Improvements: Open curtains and clean windows to maximize natural light Install dimmer switches for flexibility Use warm-toned bulbs (2700-3000K) in living rooms Add under-cabinet lighting in kitchens Upgrade outdated fixtures Cost: Under $200 for most rooms with significant impact. 5 Boost Curb Appeal First impressions happen within 7-10 seconds of seeing your property. Homes with great curb appeal can sell for 7-14% more than similar properties, and 92% of Realtors recommend improving the exterior. Return on Investment Affordable curb appeal upgrades can increase perceived property value by 5-11% with minimal investment. High-Impact Improvements: Power wash exterior, walkways, and driveway Paint the front door and update hardware Keep lawn mowed and add fresh mulch Clean windows inside and out Add colorful flowers or potted plants Install modern house numbers and mailbox Budget-Friendly Costs: Exterior paint: ~$35 per gallon Light fixtures: Starting at $25 New mailbox: As low as $20 Time Required: Most projects can be completed in a weekend. DIY vs. Professional Staging Choosing between DIY and professional staging depends on your budget, time, and design skills. Both approaches can be effective when done properly. Factor DIY Staging Professional Staging Upfront Cost $200–$800 (paint, décor, accessories) $500–$1,500 per room Time Investment 2–4 weeks of personal effort 1–2 weeks with limited homeowner input Expertise Level Based on homeowner’s design skills Professional design and market insight Best For Smaller homes, budget-conscious sellers Larger homes, vacant properties, time-pressed sellers Frequently Asked Questions What are some affordable tips for staging my home effectively? Start with the basics: declutter and deep clean every room. A spotless, clutter-free space instantly feels more open and welcoming. Rearrange furniture to emphasize standout features like windows or fireplaces. Add mirrors to make rooms feel brighter and more spacious. Simple updates like fresh flowers, stylish throw pillows, or modern light fixtures can breathe new life into your space for minimal cost. What are the advantages of hiring a professional home stager? Professional home stagers know exactly how to emphasize your home’s best features, downplay flaws, and create a welcoming vibe that resonates with buyers. Their expertise often results in faster sales and higher offers. They bring an unbiased perspective and have access to modern furniture and décor that appeals to today’s buyers. Why is curb appeal important when selling a home? Curb appeal creates a crucial first impression within 7-10 seconds of buyers seeing your property. A tidy, welcoming exterior suggests the home has been well cared for, boosting perceived value. Simple improvements like landscaping, fresh paint, or updated fixtures can help your home sell faster and potentially for a better price. Ready to Stage Your Home? These proven staging strategies can help your home stand out in today’s competitive market. Whether you choose DIY or professional staging, the key is creating a space where buyers can imagine themselves living. Get Started Today
