Selling a property is not as simple as it seems. Apart from the obvious expenses such as real estate commissions and closing costs, there are a range of hidden costs that can take you by surprise. This guide aims to provide a complete overview of these lesser-known expenses to help you dodge unexpected shocks and maximize your returns from your property sale.
Preparing Your Home for Sale
Before your property hits the market, it typically requires some sprucing up. This could include general deep cleaning, minor repairs, or some basic landscaping to enhance your home’s curb appeal. The cost of these preparations can vary significantly depending on the initial condition of your property and whether you outsource these tasks or do them yourself.
Cost of Cleaning and Repairs
Professional house cleaning and carpet cleaning services can sometimes be necessary, especially if the property has been neglected for a while. Additionally, hiring a handyman for minor fixes can also add up if you are unable to do the repairs yourself or prefer not to take shortcuts. Even if you decide to do the work yourself, you should factor in the cost of supplies needed for the upgrades.
The Power of Staging
According to 2022 data from HomeAdvisor, staging costs can range between $786 and $2,812, with an average cost of $1,774. Staging helps potential buyers visualize living in the home, creating an emotional connection that could lead to a higher offer. The cost can vary widely depending on the size of your home, your location, and other factors.
If you wish to save on professional staging, you can attempt to stage your house on your own or with the help of your real estate agent. Even though you may not achieve the same level of design quality as a professional home stager, you can still make an impact by decluttering as much as possible and assigning a clear purpose to each room. Small touches like fresh flowers, a new doormat, a bowl of fruit on the kitchen counter, and scented candles can make a significant difference.
Professional Real Estate Photography
According to the 2022 Profile of Home Buyers and Sellers by the National Association of REALTORS®, 47 percent of buyers start the home buying process by looking online at properties for sale
Therefore, it’s crucial that the photos of your home are professionally done and showcase your property’s best features to draw potential buyers.
The cost of professional real estate photography can range from $100 to $500, varying by area and the size of your home. This expense is often overlooked but is a powerful tool in marketing your property.
Home Inspection and Repairs
Once a buyer’s offer is accepted and they have the home inspected, the inspection report rarely comes back perfect. Both minor issues like loose toilets or leaky faucets and major issues like water damage, mold problems, or faults in the foundation can be flagged. These unexpected repairs can be one of the most unwelcome hidden expenses of selling a home.
You can negotiate with the buyer to split the cost of repairs, lower the sale price so the buyer can handle the repairs themselves, or cover the total repair costs. However, the latter could run into thousands of dollars.
In real estate transactions, buyers often make conditional requests to be included in the purchase price. These costs that the seller agrees to pay are called seller concessions. A buyer could request the seller to pay a portion of their closing costs or leave certain household appliances. In some cases, you may agree to reduce the overall sale price to account for the cost of handling any major repairs.
Selling a home involves more costs than you may initially anticipate. Familiarizing yourself with these hidden costs can help you avoid unpleasant surprises. With strategic planning and the help of an experienced real estate agent, you can effectively manage these costs and ensure you meet your profit targets at closing.