Simply put

How much does it cost to sell your home?

By Brenda Spiering, Editor, BrighterLife.ca

Comments (8)

Toronto couple Peter and Nadine couldn’t wait to sell their tiny, two-bedroom house and move into a home big enough to accommodate their growing family. They knew their house would sell fast in Toronto’s hot real estate market, but what they didn’t count on was how much it would cost to make the sale. Nadine, who was shocked by the costs, reckons they paid around $50,000 for real estate agent commissions, legal fees and the money they spent to fix up their home for a quick sale, on top of the purchase price of their new house. That figure also includes the hefty land transfer tax they had to pay for the new home they bought.

How much does it cost to sell your home“All told, the cost of selling took a big bite out of our down payment on a new home,” says Nadine, noting they brought their original budget down.

If you’re thinking of selling your home, you need to budget for the added costs involved in making the sale, especially if you’re using the proceeds to finance the purchase of another home. That means keeping an eye on the following expenses:

Real estate agent commissions: These can run anywhere between 3% and 7% depending on where you live and what you negotiate with your agent. A 4% real estate commission on a house that sells for $350,000 will set you back $14,000. In a hot market, you may be able to avoid this fee by selling your own home. But it’s wise to still consult an appraiser to help determine your home’s worth (starting at around $300) and a real estate lawyer to draw up the paperwork.

Legal fees: Budget for at least $500, sometimes more depending on how complex your deal is.

Home staging: Paul and Nadine painted their house, moved all of their stuff out and even rented art to make their home look great to potential buyers. Total cost for them: $1,000, but that can vary depending on how much fixing up your place needs.

Land or property transfer tax: If you are buying a new home, land transfer tax can easily be your biggest expense. The tax is based on a percentage of the purchase price of the home and it varies from province to province (ranging from .5% to 2% of the total property value).

Moving costs: Depending on where you’re moving and how much stuff you have to shift, you’ll likely need to factor in at least a couple of hundred dollars for moving expenses — unless, of course, you have your own truck and willing friends who will work for pizza and beer.

Simply put: Selling a home can cost a lot of money. And you need to make sure you budget for the costs – otherwise you could get a nasty shock when it comes time to close the deal.

Read more about buying and selling your home:

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sterdeus on

The article is grossly misleading into the total cost of selling your house. The $50,000 figure includes renovations, some places do not need this. You’re looking closer to $23,000 for a $500,000 house ($20,000 commission at 4% total and $3000 other expenses).

Trying to sell your own house is not that simple as it sounds – you should abide and go by all the laws that realtors are held to that most people don’t know. Some people have sold their own house by doing some research in advance. True this can be done but I would guess they did 50+ hours of research if they did it right. If not, they leave themselves open to selling too low, being sued, etc.

Contracts associated with buying and selling can be confusing. While the system has been created to make it easier, added statements written into schedules can be difficult to understand, especially if the other side purposely does it. Real estate agents have training and experience to understand it.

Rock Star on

Try actually reading the article before posting comments. Part of the 50k was for renovations

ta on

why not sell your own home? it means work I agree for 50 thousand dollars yes it pays off do it yourself

    Ron Williams on

    Many try, and the average is 99% fail rate. Its not that simple and when you sell yourself you accept to abide and go by all the laws that realtors are held to, most people don’t know. There is much more to this than selling a car, especially in liability and legalities. What perceived savings are unusually gone as house sell lower. That is never posted on the Private sale sites, only how fast if it does. they never publish the selling prices as they would be out of their only business which is selling you advertising and web space. Thats the product, not your house or sale. Bit of a racket. Can be done, just not usually easy.
    And a huge myth is buyer pays for all the costs of selling, may look that way but it is split with the buyer as they are paying the price. Its in every house sale and both share it.

    No, not a realtor.

      Me Garner on

      I’ve bought and sold privately 4 times in 10 years. It is a very simple and easy process. Not once have I had problems. You don’t need a realtor. Just do your research and use your common sense.

      Dawn on

      I hired a realtor to sell my house, after the three month contract was over and we only had one offer, I decided to list it myself with one of the local private companies you can list on. They provided legal advice when I needed it and posted it on their website, BAMB! I got a great offer with-in a month, somewhat higher than the offer brought to me by my realtor, and didn’t have to give a chunk of my profits to a realtor. The company provided me with all the information to close the deal, and access to a lawyer to finish the process. I’ll never use a realtor, I’d rather pocket the money than give it needlessly to someone else!

Dan on

$50,000 to sell a house? Uh,no.. Kind of a misleading article. In Vancouver realtors charge 7 % on the first $100,000 of the sale price and 2.5% on the rest.

    Peter d. Mare (@peterdmare) on

    7% (1st $100,000) and 2.5% (on the rest) does not make sense. Every extra $1000 is only an extra $25 in their pocket. A $1000 less is $25 less. They have no incentive to sell your home at the best price. Negotiate to change the structure to 4% on the first $100,000 and whatever makes sense on the rest so they get maybe $100 more from every $1000 they go over an average price. Otherwise, realtors get their money no matter what the selling price they … “negotiate”, give or take $25 or $50! That’s wrong! They are happy to sell it quickly and make another quick buck elsewhere.

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