Costs to Sell a House
There are many costs associated with selling your home, so before you put your home on the market, make sure you are aware of everything that is entailed.
The three main costs are conveyancing, marketing and the agent's fee.
Each agency will offer different marketing and fee options, however it is important to note that the highest marketing package will not necessarily outweigh cheaper alternatives. Furthermore, the cheapest agent fee will not necessarily guarantee you the highest price for your property. So it is really important that you select the right agent to represent you and your home.
Conveyancing is the process of transferring legal ownership of a property from one person to another and is required in every real estate purchase. It can be done by licensed conveyancers and solicitors, or if you know enough about the process, can be done by yourself.
Vendors should budget between $800 and $2200 for conveyancing. Again, the cheapest conveyancer may not be the best solution for your transaction, so make sure you talk to your agent if you don't have a pre-existing relationship with a conveyancer.
Having a marketing budget is important as the vendor covers the cost of marketing their property. Each listing is unique and campaigns are adjusted depending on the market on who you are pitching your house towards.
The average marketing fee generally fall's between $1,000 and $10,000. Discuss your options with your agent, because going with the cheapest package could mean you are missing out on potential buyers. However, the most expensive package may not be the best suited for your property and you could save a bit of money.
There are two types of real estate agent fees:
- Flat Fee: where the agent and vendor agree on a fixed fee for the sale of the property, and no matter what it sells for, the fee is set.
- Percentage of Sale Fee: where the agent gets a certain percentage of the final sale price.
The percentage of sale fee, or ‘commission’, can range from 1% to 3%, but is influenced by a number of factors, such as the property value and the competition for business among agents.
Bonuses are also increasingly being used also where the agent and vendor agree on a percentage-based bonus if the property makes above the agreed reserve. For example, a property expected to sell for $1 million, being sold by an agent on a 1.5% ‘percentage of sale’ fee and 10% ‘bonus’ fee, that goes for $1.1 million, nets the agent $25,000. This is made up of $15,000 for the percentage fee (1.5% of $1 million) plus a bonus $10,000 (10% of the $100,000 above reserve).
Auction Fees also should be considered and they can range anywhere from $400-$1000 across Brisbane. Ask your potential agent if they have an auctioneers licence, if they do, you might be able to avoid this fee all together.
All fees should be discussed with the agent before signing.
If you have a mortgage on the current home you’re selling, you’ll need to pay your lender a discharge or early exit fee. Each lender charges their customers a different amount for this service, but it usually falls within the range of $150 and $1500.
Your lender should have their own mortgage discharge forms to fill in, with the entire discharge process usually taking between 14 and 21 days.
Styling & Maintenance
To maximise sale price, many agents recommend professional styling and basic maintenance around the property.
Styling is about making the property as appealing as possible, to show off the space and make sure it feels good, to entice as many buyers as possible to purchase your home. The cost of styling can range from as much as $6000 to fill and style an empty property, to very little, with good agents offering free advice about ways to declutter a home and make it look great.
Trimming a bush, clearing clutter from a kids’ room, putting junk in storage, borrowing some nice outdoor furniture from a friend to dress a deck are are all quick and easy and can have a big impact. Most agents will also recommend completing jobs around the home to improve it for sale. Such jobs can vary in price, depending on complexity.
Would you like to be put in touch with a specialist to work out how much it could potentially cost you to sell your home? Send me a message HERE, and let me know whether its conveyancing, marketing, styling, maintenance or agent fees you would like more information on.