Rule of Thumb for Estimating Costs Selling?

Question

Have never sold a property but I get offers quite a bit. Most claiming to cover closings costs/sellers cost.

Is there a general rule of thumb for what to expect to pay in fees/taxes when selling a property? I have heard 15%?

(Offer)-(What I Owe)=X*(0.85)=ACTUAL TAKEHOME $$

I am asking about the 85% I have written in equation.

Bryan Hartlen · Answer

@Tim Kaminski Many selling costs are fixed (eg title search fee) while others will scale with the sale price (title insurance and realtor fees). Prorations (mostly for for taxes) will also vary from market to market. Depending on how accurate you want or need to be a % estimate may not work for you.  It will be much lower than 15%.  In our markets, it’s probably closer to 1 - 1.5% above any realtor fees.  Here are the costs we use for our market when modeling projects. If you need more precision, you can reach out to a local closing company for an estimate.

Mohammed Rahman · Answer

hi @Tim Kaminski - transfer taxes/fees depend on your location. A quick google search will tell you what your transfer tax rate is.

Additionally - you should budget around ~ 3-5% for all closing costs that also includes attorney fees, mortgage payoff fees, etc.

This figure can vary based on how the deal goes. Remember, everything is negotiable so you can also have the buyer pay off these fees.

Most folks that are offering you a cash offer + offering to pay off all your closing costs typically buy at a good price (if they're investors). But this could also vary in your market, for example if inventory is so low then buyers may offer to pay your closing costs too.