How Much Does It Cost To Sell A House

How Much Does It Cost To Sell A House?

February 17, 2021

Produced by:
Richard Stevens

Richard Stevens is an active real estate investor with over 8 years of industry experience. He specializes in researching topics that appeal to real estate investors and building calculators that can help property investors understand the expected costs and returns when executing real estate deals.

Quick Summary

As a broad rule of thumb, you can assume that selling costs will total around 10% of the home’s value, if not more. 

If you choose to use a real estate agent (which most people do), you effectively start off with agent commission fees that will likely amount to 5-6% of the sale price. That leaves another 3-4% for repair costs, closing costs, home inspection services, and other unavoidable expenses that most homeowners will run into when they sell their home. 

Whatever you do during the sale, make sure you budget at least 10% to cover all the costs involved.

We will now take a closer look at the costs you can expect

  • Before the sale
  • During the sale
  • After the sale

Table of Contents

Costs That Occur Before The Sale

1. Repair Costs

Of all the costs that you will run into when selling a house, repair costs will vary widely from house to house. This is because homeowners differ greatly in their home maintenance habits. Some owners look after the homes with fastidious care. Others are content with panicked rescue jobs when things stop working. 

Most importantly, home repairs can have a massive impact on the selling price.  House flippers leverage this principle to execute deals that average more than $60,000 in gross revenue (according to Attom) 

When it comes to repairs, you effectively have two choices

Focus on high ROI home improvements before you list the home for sale:  This approach requires more effort, but it can definitely increase the final selling price. You need to draw inspiration from professional house flippers and focus on renovations that are known to increase home value. This is the best way to fetch the maximum possible sales price. 

Sell the house as-is, but for a lower price than its market value: If you don’t have the time or money needed for the repairs, it’s perfectly acceptable to sell it as is. However, by choosing this approach, you also need to accept that the final offer will likely be lower than the market value. 

2. Home Inspection Costs

According to, the national average for inspection costs is $337. $200 represents the low end of the scale, whereas $500 represents the top end of the scale. To be safe, we recommend budgeting $350 for this cost, and potentially more if you are selling a large home. 

3. Staging Costs

Staging costs are the most divisive expense on this list, precisely because so many owners choose not to stage their home. According to, you should budget $300 to $600 for the initial consultation, and $500-$600 per month for each staged room. 

This leads to the more important question of whether or not staging can help you sell your home for more money. “About three-quarters of home sellers see a 5% to 15% return on investment over the list price of their home after making an average investment of 1% of the list price, according to RESA

This is important because it means that if you take on a staging cost of approximately 1%, there’s a good chance you can sell the house for 5% to 15% more than the standard listing price. When viewed from this perspective, you can make a strong argument for taking on the cost of staging your house. 

In the end, the key to this decision is to determine if your existing interior design choices will help or hinder your ability to sell the house to a potential buyer. 

Costs That Occur During The Sale (Closing Costs)

1. Real Estate Agent Fees

Technically speaking, you don’t have to use a real estate agent to help sell your home. However, for most people, it can help accelerate the sale process dramatically, while ensuring that all legal protocols are followed correctly.  

More importantly, estate agent commissions tend to be the biggest expense when selling a house, ranging from 4-7 percent, depending on which agency you use. As a safe bet, stick with 6% when factoring this cost into your budget. 

You should find it relatively easy to find a reputable agent that is happy to work with a 6% fee. If you already have a good relationship with an agent that charges less, you can potentially save a substantial amount of cash when the sale concludes. 

It is also worth mentioning that it is becoming increasingly common for property owners to cut out the realtor completely, by listing their house as a for sale by owner (FSBO) property. 

2. Transfer taxes

When you sell your home, transfer tax is one of those annoying yet unavoidable fees that you will have to pay. While each state will have a slightly different amount, it ranges from 0.1% to 0.75%, depending on the state and the value of the home. 

On this point, it’s worth mentioning that the following states do not impose a transfer tax:

  • Alaska
  • Idaho
  • Indiana
  • Louisiana
  • Kansas
  • Mississippi
  • Missouri
  • Montana
  • New Mexico
  • North Dakota
  • Texas
  • Utah
  • Wyoming

3. Title Insurance

According to research conducted by NAILTA (national association of independent land title agents), the average cost of title insurance is approximately $1,374 for a $200,000 home. This works out to 0.68%.

To be on the safe side, it is advisable to budget for 0.7% when estimating the cost of title insurance for your property. With that being said, the exact cost of title insurance will be unique to your home, and it is possible it could be more than this.  

4. Property Taxes

Every property is subject to property annual property tax. As the existing owner, if you have already paid this fee, you can actually be partially reimbursed by the buyer, for the portion of the year that will fall into their ownership. However, if you have yet to pay property tax in the year of the sale, you will need to settle your portion of this fee during the close of the sale. 

Research conducted by WalletHub indicates that the average cost of property taxes in the US is approximately $2,279 per year. However, this blanket figure doesn’t tell the full story, given that property tax varies widely from state to state. In Hawaii for instance, property tax is only 0.27%. This is in stark contrast to New Jersey, where property tax is 2.47%, which is almost 10 times more!

As the owner of the home, you should already know the annual property tax fee, but if simply want to verify the tax amount in each particular state, you should find this guide very helpful (link to be added).

Costs That Occur After The Sale

1. Capital Gains Tax

Before bemoaning yet another form of tax during the sale, it’s worth mentioning that you can qualify for a substantial tax break if you are selling your primary residence, and it has been more than 2 years since you last sold a home. 

To be more specific, you can exclude up to $250,000 of profit made during the sale from your federal tax return. However, if the house is an investment property rather than an owner-occupied property, you will be liable for capital gains taxed at either 0%, 15%, or 20%, depending on the profit made and your marital status. 

2. Paying off your mortgage

One of the best aspects of selling a house is that you can pay off your entire mortgage in one swift transaction. However, you may have to pay more than you currently owe, in order to officially close the mortgage. There are two reasons for this. 

  1. Prorated Interest: There is a daily interest amount currently associated with your mortgage.  When you sell the house, you still need to cover the interest that has accumulated since your last mortgage payment. 
  2. Prepayment Penalty: Most banks will stipulate a notification window (eg 30 days), that you must adhere to in order to avoid paying an early settlement fee. In most cases you can actually avoid this fee by informing your bank of the pending sale, within the allotted time window. 

However, if you fail to let your bank know about the sale, you will need to add this cost to your final calculation. Depending on your initial mortgage agreement, this could be a cost that you have full control over. It is in your best interests to follow all the steps needed to avoid it. 

3. Moving Costs

Once the sale is concluded, you will have to evacuate your house, and take all of your possessions with you. According to HomeAdvisor, moving costs usually range from $730 to $1,971. Based on this, you should budget at least $1,500 for moving costs, and potentially more if you have a large home and lots of furniture and possessions. 

Final Thoughts

At this point, it should be pretty clear selling costs can add up to thousands of dollars. If you fail to account for this expense, it can come back to bite you when all the legal paperwork is signed and the ownership is officially transferred. 

To avoid any bitter feelings during the sale, remember to budget at least 10% of the home’s sale price, to cover all the most common closing costs that you are likely to encounter during the sale of your home. 


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