The Hidden Costs of Selling a Home That You Didn’t Know About

If you’re planning to sell your home in the near future, it may cost you more than you think. According to a recent report by services marketplace Thumbtack and real estate website Zillow, Americans spend almost $15,190 on average during the process of offloading their homes.

While most of the costs like real estate agent fees and transfer taxes are commonplace to the home-selling process, there are some expenses that can take first-time sellers by surprise.

According to Zillow’s report, almost two-thirds of homeowners who sold their properties last year were stuck by high unexpected costs

According to Zillow’s report, almost two-thirds of homeowners who sold their properties last year were stuck by high unexpected costs. Zillow’s Chief Marketing Officer, Jeremy Wacksman, stressed that people who’re planning to sell their homes in 2019 need to think about their decision and calculate all the costs associated with the offloading process.

Here are some of the biggest expenses that could cost you thousands of dollars during your first home sale.

Remortgaging

Usually, when people sell one home, they do it with the intention of buying a second property. If you already have existing mortgage in the house you’re planning to sell, you can either transfer it to a new property or look around for a better deal from a different lender.

Homeowners are applying for remortgages nationwide to take advantage of low interest rates and if you’re planning to move into a new house, this might be the perfect time to re-evaluate your financial situation and make adjustments to your mortgage deal accordingly.

If you do choose to remortgage, remember that it can come with an additional expense in the form of a repayment fee that needs to be paid to the lender. This amount can be anywhere between 1 to 5 per cent of your outstanding home loan. So factor this cost into the equation to see if the remortgaging option has any savings benefit.

If you do choose to remortgage, remember that it can come with an additional expense in the form of a repayment fee that needs to be paid to the lender

Estate agent fees

Selling a home can become a whole lot easier with the help of a real estate agent who knows how to negotiate with buyers, give an accurate valuation of your home and collaborating with conveyancers. But while there are benefits of using an estate agent, you may have to pay high fees or commission at the end of the sale process.

In 2017, real estate agents charged an average commission of 1.2 per cent of the sale amount which could run as high as $1,500 on a property that sold for $150,000. The amount your real estate agent will charge you depends on the level of service they provide, so make sure to check with your agent and ask how much they charge before starting the sales process.

Conveyancing fees

Most people think that selling a home is as simple as finding a buyer and trading keys, but in reality, the process can be a lot more complicated than that. Before finalizing the sale, you may need the help of a legal expert who can oversee the complexities of property transfer.

A conveyancer will prepare all the legal documents for the sale and make sure that they are signed by the right people. In return, they charge a flat fee for their services or a commission based on the percentage of the home value. You can also use the help of the same conveyancer to for negotiating the price of your new home.

A conveyancer will prepare all the legal documents for the sale and make sure that they are signed by the right people

Energy Performance Certificates

An Energy Performance Certificate (EPC) is a mandatory part of the home sale process. This legal document grades the energy efficiency of a property and needs to be transferred to the buyer at the time of finalizing the sale. It can typically cost between $50 to $150 to acquire an EPC and the document is valid for 10 years.

Renting

Under ideal circumstances, you can sell your existing home and buy a new one simultaneously so that you can move into your property immediately after closing sale for your old home. But that rarely ever happens in real life.

If you’re planning to sell your home, you might want to factor in the cost of renting a place temporarily until your find your permanent nest. This is especially true if staying with friends or family isn’t an option or if you need to rent a garage or storage space to keep your furniture until you can find a new home.

Taking the moving cost, rent and storage into consideration, you could be spending a lot more money on the process than you had anticipated.