What’s a quick rule of thumb for determining the cost to sell a home. Could you use a percentage like 13%?
There are too many factors to answer this when dealing with investors…for example, I don’t spend anything to sell a home…because, I always sell with ‘owner financing, no credit required’ and sell at a premium above the market price.
If you use a realtor, you can pay 10% commission on commercial or negotiate 4 or 5% on residential discount brokers.
FSBO can cost you for signs and some time but if you sell to a qualified buyer with good credit and a new loan, you can expect to negotiate giving some closing costs to give buyer incentive to buy your home over someone else’s home for sale.
Hope this helps.
Closing cost to seller 2.5% average!
Real Estate Commission 4.5 discount to 6% retail average!
I’m assuming you’re asking for yourself, and not looking for ammo against a seller, is that correct?
If so…as Rob pointed out, it depends on whether you’re selling conventionally, or seller financing the deal.
The rule of thumb would be:
- Discount the standard commission in your market. 5-7%.
- Discount the normal costs of title, escrow, any shared financing costs. 3%
- Discount 3-6/mos utilities, insurance, maintenance, taxes due until closing. 2%
That’s a long way to say 10-12%. Figure 12% to be safe.
Thanks so much. You guys are awesome. You’re like information angels.