Selling a home is an endeavor that you might assume will earn you some money. But while most people do end up earning some cash when they sell their home, there are also some expenses to account for along the way. Make sure you're aware of these expenses so you can plan properly and account for them when figuring out how much you'll ultimately earn from the sale.

1. Realtor Commission

Typically, you will pay Realtor commission equal to 6 percent of the sale price of the home. Half of this money — 3 percent of the sale price — will go to the buyer's real estate agent. The other half — another 3 percent — will go to the seller's real estate agent. If you and the buyer use the same agent, you may be able to negotiate the commission rate slightly. For instance, the realtor may accept 5% commission since they do not have to coordinate with another real estate agent in the sale. Check out websites like ListingBidder.com to learn more about commission rates.

Some people opt to sell their home without a real estate agent in an attempt to save on this commission, but if you choose to go this route, proceed with caution. There is a lot of red tape involved with selling real estate, and agents know how to navigate that red tape. If you choose to go without their services, you may find yourself over your head in legal jargon and paperwork.

2. Fix-Up Costs

Even if your home is in great shape, there are bound to be a few things you want to fix before you sell it. For instance, you may want to patch some nail holes or have the landscape tidied up. Go through the home and make a list of these projects you need to tackle. Then, estimate the cost of each project so you can account for the costs properly.

3. Travel Expenses

If you are moving to a different town and trying to sell your home at the same time, you will probably have to do some traveling back and forth to meet with real estate agents, your bank, and your lawyer. Make sure you plan for the cost of gas, tolls, and if needed, a place to stay while you're in town. Hopefully your home sells quickly so you don't have to make too many of these trips, but it's helpful to set some extra cash aside just in case you need to go back and forth a few times.

4. Legal Fees

You will need to hire a lawyer to look over all the necessary paperwork related to the sale, including the deed and the contract. This is not usually a huge endeavor, so you should only have legal fees of a few hundred dollars — as long as your sale is not complicated by any environmental issues or liens on the home. Your real estate agent can recommend a lawyer in the area if you do not have one already.

5. Advertising

Your real estate agent can do a lot of the advertising for you, but you may want to do some advertising yourself, especially if you live in a niche community. Put a few hundred dollars aside to pay for ads in local papers, paid ads on social media, and so forth. Some real estate agents may have connections to get you discounts on this type of advertisement, so be sure to ask.

The real estate market is hot in 2018, and you will probably make a profit if you sell your home. Just make sure you take the costs above into account when calculating how much you expect to earn. 

Share