01 Aug The Hidden Fees to Selling a Home With a Realtor
If you are looking to sell your house, you may be wondering whether to sign a contract with a realtor or whether to try to conduct a private sale. Or, you may wonder if selling to a company that offers cash for homes is right for you. There are several different options, and while many people choose to contact a real estate agent it’s essential to understand the hidden fees associated with signing a contract. Once you take these fees into consideration you may determine that it makes the most sense to sell your home for cash instead.
Real estate agents work off commission. That means that they only get paid when they complete a sale. While they will certainly work to ensure your home sells, they cannot control the current market. This means that your home listing may sit for quite some time before receiving an offer and there is nothing the realtor can do about it. Additionally, when you sign a contract with an agent it often comes with a stipulation that you may not try to sell your home privately for a period of at least six months. So, even if your home isn’t receiving offers, you have to stick with the realtor until that contract lapses. When you add this to the hidden fees you may be responsible for it can equate to a risky decision.
Did you know that the person selling a home is generally responsible for paying the real estate agent’s commission fees? These fees are often between 5% and 6% of your home’s total value, meaning that you may end up paying thousands of dollars to the realtor upon the final sale of your home. The more expensive your home is, the more you are going to have to pay them.
Commission rates will be the biggest chunk of money you end up paying out to a realtor when you sell your home. Experts state that the amount usually averages approximately 75% of the total seller’s cost.
Professional Staging Photos and Video
It’s common for real estate agencies to request staging photos of your home for listing purposes. These are photos taken by a professional, sometimes with the help of a professional stager. A stager will come into your home and arrange furniture and place decor in a way they feel is visually appealing to buyers. Hiring a professional stager alone can cost up to $500 a room, according to experts. Professional photography is another fee on top of that.
Additionally, these days many realtors push video production services on clients. Many websites list homes with “virtual tours and walkthroughs.” This enables potential buyers to watch a video that brings them through your home, without ever having to visit it in person. However, videographer fees can get expensive and generally start around $300 per production.
Home Inspection Prior to Listing
While it is not a legal requirement that you complete an independent inspection before officially listing your home, many realtors will insist that you do. This is to avoid any surprises further down the line when a prospective buyer orders their own inspection before purchasing your home. You can expect to pay anywhere from $150 to $500 for a full home inspection, depending on the size of your house and the amenities inside.
Once you hire a realtor and sign the contract the rest should take care of itself, right? Not always. If your realtor plans on hosting open houses you may face fees for things such as designing and printing flyers. Additionally, your real estate agency may charge you for online and print advertisements that announce the event. These fees can add up quickly, with estimates of approximately $260 per open house.
Additional Costs to Consider
It is imperative that you assess and consider the hidden fees of selling your home with a realtor before you put your home on the market, as these are not the only costs you will have to pay during the sales process. As the seller, you will also likely be responsible for a portion of closing costs, which include things such as title fees, property taxes, loan fees, recording of the deed, surveyor costs, and more.
These costs can add up quite quickly. While the buyer does pay for some of these closing costs, you will be responsible for the rest. The national average for closing costs is between 2% and 7% of your home’s total value. Again, this equates to thousands of dollars on top of the other fees you must pay when you hire a realtor.
Before you decide to sell your home with a realtor look at your budget and how much you are looking to take away from the total sale. It may make the most sense to skip the agency and sell your home for cash instead.