The question of how much it costs to sell a house often comes up for sellers and potential buyers alike. This is one of the most fundamental questions that every buyer and seller should ask themselves. Knowing the cost of selling a home will not only help you determine if the asking price is reasonable, but it will also give you a better idea of how much you should really be asking for the property. Understanding how real estate commission works and understanding closing costs could help you determine whether or not selling your house will be profitable.
Real Estate Commissions
Selling a home costs about 10% of the home selling price. A real estate agent gets paid a commission for every house they sell. This commission varies from one real estate agent to the next, but typically the commission is in the neighborhood of five to six percent of the selling price. This six to seven percent figure is just one component of the many fees that must be paid by the buyer who wishes to sell. These fees include a real estate agent’s commission, closing costs, buyer’s association fee, listing and title fees, a discount real estate broker‘s commission, property assessment fee, and the real estate commission.
Why Are Real Estate Commissions So High?
One reason is that real estate commissions are based on the average sale price of comparable homes in the area. Another reason is that real estate commissions are paid once, whereas mortgages and buyers’ loans often need to be paid back several times over the course of a home’s lifetime. Many buyers do not understand what is involved in the process of paying back their mortgage or buying their first house. In addition, real estate commissions can be subject to change, since they are negotiated at the time of the sale rather than at the time of the contract.
Does the Location of the Home Impact Selling Costs?
The location of your home will greatly impact how much it costs to sell your home. Homes located in nicer neighborhoods tend to be more expensive to sell than homes in more remote areas, because there is more competition for buyers. In more remote areas, it may take more time for potential homebuyers to find a home, which could lead to higher closing costs and less money from the sale. So you will likely see a larger home closer to the city, with higher real estate fees, and a smaller, more rural home closer to the farm or the nearest town.
The Marketing Process Matters When You Sell a House
The amount of time spent on the marketing process is another important factor. Realtors take into account marketing efforts when calculating the cost of listing houses. This includes looking for good buyers, preparing marketing materials, finding out about local real estate market trends, preparing for open houses, advertising and participating in open houses, and following real estate market trends to make the most of real estate sales. In addition to how much does it cost to list a home, buyers and sellers must also determine if they will enter into the escrow process after the closing process has been completed.
What Other Fees Can Be Included When You Sell a House?
You have to consider all aspects of your home’s appearance before you make any decisions about your home. Include the cost of landscaping and improvements, like mowing the lawn and painting the house. These costs will add up quickly, and you have to know what you are talking about when you are talking about these costs. Also include the cost of real estate fees, which can often be expensive if you have not saved up enough money on your mortgage balance to cover them. Your closing costs, which include appraisals, insurance, and title insurance, will also need to be considered.
What Are Closing Costs?
Closing costs are the portion of a sale that is subtracted from the final sale price in order to pay for realtor fees, property taxes, and other miscellaneous items that sellers usually include in the purchase price. Closing costs can vary greatly depending on the type of property in question, as well as the market for properties in the area. Also, the size of the property can affect the amount that is paid out in closing costs.
Conclusion
The cost of buying a property can be very difficult to determine without a clear picture of all of the costs that are associated with taking possession of the property and transferring ownership. When you decide to put your house on the market you will need to understand how much it will cost to raise the asking price, how much it will cost to list the property on the MLS listing, and how much it will cost to perform the various tasks associated with selling a property. Once you have a clear picture of these costs, you will be in a better position to negotiate a realistic price with your realtor.
The phrase “discount real estate broker” generally refers to an individual or company that offers commission savings on property sales. These brokers often offer discounts to both homebuyers and sellers alike for residential, commercial, and industrial properties. Some discount real estate brokers even offer rebate or bonus incentives at closing for when you buy a home or when you sell your home. These brokers have access to resources that would normally be unavailable to homebuyers and sellers, and they make offers on properties that would not normally be offered to them by traditional realtors.
Discount Real Estate Brokers Are a Bridge
One of the reasons that brokers are able to offer such substantial discounts is due to the fact that brokers are often hired as a bridge between a seller and buyer. In many instances, a full service broker can take the position of a buyer’s agent while the seller acts as the seller’s agent. While a typical listing agent makes an offer on a property, a full service sales experience allows the seller to make an offer with their own agent, with less money out of pocket. This gives the seller the ability to make a counteroffer, should the counter offer be turned down. If the offer made by the listing agent is matched by the seller, the listing agent makes money off the full service commission.
Discount Real Estate Brokers Understand Market Trends
Full service brokers have the benefit of knowing market trends and buying trends, which allows them to make wiser offers on property. These brokers have the benefit of working with buyers and sellers from across the country and they have access to multiple listing services, with discounted prices on homes from every part of the country. Discount brokers do not typically work with full buyer or seller pools, so they are typically more cost effective for people looking to save money.
Discount Real Estate Brokers Are Assets For Investors
For any real estate investor, a discount real estate broker can be an invaluable asset. When you are buying or selling a home, you want to get the best bang for your buck. A discount real estate broker can work at a lower rate, but if they don’t offer even the most basic service, they get to earn that big fat dip in profit by simply increasing their number of clients. The more clients that they serve, the less time they need to spend working on you. This is how they stay in business. Typically full-service brokerage firms will offer discounts to attract new business and are willing to negotiate closing costs. Some discount brokers offer discounts on their commission structure to retain existing clients. Such commission structures may include flat rate reductions for new sales and special incentives for renewing or remodeling contracts.
However, not every discount real estate broker offers this kind of thing. What we want from the right real estate agent is someone who will work with us until we are ready to buy or sell a home. Someone who will help us through every step of the selling process – from initial contact right down to the filing of all of the necessary paperwork and the final sale of the home. But the one model that every home seller should be using when they are selling their home is the flat fee MLS.
Conclusion
Flat fee MLS listing services are offered by virtually every discount real estate broker today. If you want to sell your home fast, you should use these services. You can save money and use a marketing strategy that works. And you can rest assured knowing that you are not being cheated by a commission hungry seller. A real estate listing service is a powerful tool that can give you the upper hand in the selling game!
It is a seller’s market so if you’re ready to sell your home, 2019 is the year to move forward with your plans. It’s been several years since the real estate market made any big changes and many think one is overdue. Nowadays, more buyers exist than homes for sale to the point to where investors are buying homes in Mexico.
Selling a home this year can produce an easier buying process and better profits – all the things that make home seller’s happy. It is easy to sell a home in a seller’s market, but don’t assume that the property will sell itself. To ensure maximum profit and a smooth closing day, there are a few steps that you should take when selling a home.
The Price is Right
Buyers assume the price they see for a home is the price they pay. They don’t think of sellers as being the best negotiators. As home prices are changing across the country, getting the price from the start is very important. Because there is truth to the relationship between time and money. Overpricing a home can often cause it to sit on the market much longer as buyers move onto newer and fresher inventory.
A buyer wants to endure as few headaches as possible during the process, just like you want things to go smoothly. In the end, you’ll likely need to cut the price to sell it anyway, so why not minimize the headache from the start? So, don’t think of the ‘come down in price later’ strategy works and price the home competitively from the start.
You Got The Look
No matter how new the home, buyer’s will look right past the property if it is not staged. Buyer’s want a home that is appealing; that feels like home to them. Strategic staging will help potential buyers better envision the property as a home, as their home, so it will sell much faster. Giving potential buyers that boost of imagination they need will certainly pay off when the day is done.
First Impressions Matter
Don’t forget the outside of the property when staging it to sell. It’s the first thing that a potential buyer sees when they arrive at the home. If they’re met with an unkempt lawn, dead, brown grass, peeling paint, or junk sitting outside, they’ll think twice about even going inside the home. Make sure that first impression counts. It doesn’t take a lot of money or hard work to create a space that dramatically enhances the appeal of the home, so don’t be shy about completing these steps.
Hire A Real Estate Agent
You need a real estate agent there to help with every step of the selling process. Don’t assume that an agent is helpful only when you plan to buy a home. They’re essential to a smooth selling process, too. Agents know the housing market, how to price a home, how to intrigue an audience and potential buyers, and how to make the seller happy. Do your homework when it’s time to choose an agent. There’s plenty of information waiting to learn if you aren’t afraid to do your research.
Closing costs are part of any home buying experience and venture. These are essentially out of pocket costs that are incurred at the time of closing. The fees are charges that predominately result the title and escrow company who completes the sale. It includes the escrow company fees, as well as certain fees to a title company of the seller’s choice. Title companies are necessary to provide the buyer “title insurance”. The example that best describes it to me was, “Ok, so imagine Homeowner A borrowing a large sum of money 10 years ago from Uncle B. Uncle B was smart and had Homeowner A sign a contract that included the home as partial collateral for the loan. Homeowner later sells the home to Homebuyer C. Does Uncle B, if never repaid, have a claim to the home, now owed by Homebuyer C?” Title Insurance prevents that from happening. They preventing it by providing a buyer with an insurance policy against the title of the home, so that, should any claim against the home be brought, the insurance company can provide coverage from a potential loss. This is commonly known as Title Insurance, and is almost always paid for by the seller of the home.
So, in addition to those fees, this brings us to the last step in securing timely waterfront home ownership across the board. Usually, closing costs include pre-paid homeowners insurance and appraisal costs. However, they can also include charges by the mortgage company for implementing the mortgage itself. Similarly, pre-paid interest – known as “points” – may also be assessed during closing time. Other fees may include title insurance, along with filing fees, attorney fees, recording fees and miscellaneous expenses. Fees typically operate on somewhat of a sliding scale, so the fees would be less if buying a condo vs a single family home.
Avoid Issues with Closing Costs
One of the best ways to avoid closing cost issues is by paying close attention to every detail. You simply cannot afford to get caught off guard at closing. This can result in costly delays, and possibly even turn you away from the deal altogether. With this in mind, is it vital to request an advanced copy of the HUD 1 settlement. This should be done at least three days prior to closing on your new homes. The HUD is designed to protect you during the closing process, and not worry about surprise fees on closing day. Here are some essentials you should keep in mind:
• Review the entire closing agreement – or let your attorney review it in close detail.
• Check all the closing costs and figures to make sure they are 100% correct. Point out any discrepancies or issues with credit or closing costs – and handle them ASAP.
• Stay on top of all buyer-seller- agent communications across the board. Make sure to include your lender and attorney in the loop as well.
• Make sure to keep hard copies of the HUD agreement on hand before, during and even after closing.
• Make sure everyone in the loop is on the same page – stay in close communication with your Realtor -and correct any errors or issues that can potentially cause delays.
Schedule Early Walk Throughs
Another way to avoid problems with closing costs is scheduling an early walk-through. This, of course, has to be done before closing day so you can check the home thoroughly. If you find any issues – you must notify the seller, agent or attorney at once. Remember, closing costs are governed by enforceable contracts – but all parties must be in agreement across the board. This contract also includes any legal or governing bodies – especially HUD-related rules and regulations. If you do not want to delay your closing day, all closing costs must be taken care of beforehand as well. Again, make sure every penny is accounted for on the contract – and always take photos of your bills and receipts.
You also need a detailed checklist of what was supposed to remain the property – and what was to be taken. For example: if the fixtures were supposed to remain but a few are missing, early inspections can rectify the situations before they escalate and lead you to walk out on the deal.
For more information about buyer closing costs, contact our office through homes-in-riverside.com or visit us directly.
Now that we embark on 2018, its a good time to look back and review what happened in real estate for 2017. As a whole, real estate flourished in 2017, spurred by low mortgage interest rates, high demand and a relatively low supply of homes on the market. Although 2017 was a good year for just about everyone, what were the hottest real estate markets for 2017?
Back in January of 2017, Trulia released their list of the 10 hottest real estate markets to watch for 2017. Around the same time, Zillow released their hottest real estate markets for 2017. Although Zillow owns Trulia, the lists were quite different. There was one consistency between the two lists — both were full of coastal real estate markets. Realtor.com consistently puts out their list of the top real estate markets too. It is easy to come up with different lists for the top real estate markets – it depends on which real estate statistics you choose to look at and how you weight them. When reviewing real estate market statistics, there are many data points that can be reviewed, including:
Number of home sales
Increase in the number of home sale year over year
Home prices
Increase in home prices year over year
Dollar per square foot for single family homes
Dollar per square foot increase year over year
Number of new construction
Increase, year over year, of new construction
local economic factors
population trends
Median home prices
Year over year increase in median home prices
Absorption rate of homes
Months of supply of home
and much more…
And then, of course, are you looking at every city in the country? Are you just looking at the top 100 real estate markets by size? Top 200? Most entities that are putting together a list of the the top real estate markets then have to choose what weight to give to each data point. It becomes easy to see how everyone can come up with a different list.
What Were The Real Estate Predictions for 2017?
The Top Real Estate Markets for 2017
Coastal Areas seem to dominate the top real estate markets for 2017 with ***** of the top ten being coastal real estate markets, with California making up the top three spots. The ongoing growth of the California real estate market insures that you will have no problem finding a real estate agent there – with 1 in 7 of California residents having a real estate license.
San FranciscoCA
The area of San Francisco-Oakland-Hayward has seen tremendous real estate growth. That is saying quite a lot considering the real estate prices in San Francisco have not been depressed by any stretch of the imagination. This is one of those unique areas that already had home prices that were much higher than the rest of the country – but somehow seemed to still see tremendous increases. Home prices in the San Francisco Bay area jumped 7 percent annually in November of 2017. That makes the third straight month at such dramatic increases in home values. The rate of increase was far stronger than the increase in home prices for the first half of 2017. Low supply and high demand are some of the factors attributed to the major gains.
Sacramento CA
Sacramento, much like San Francisco, already had much higher than average home prices. To see the real estate market grow at such a rate is extremely unusual. With the commercial real estate market on fire in Sacramento, we have seen the residential market follow. The Sacramento Association of Realtors recorded 1.6 months of inventory this November, meaning that’s about how long it would take to sell all of the resale homes on the market in Sacramento County and the city of West Sacramento.
Lodi CA
Although still recovering from the massive downturn, in the last few months of 2017 the Lodi California real estate market has experienced significant decreases in homeowners that are in a negative equity position. Quarter over quarter, the percentage of underwater mortgages is decreasing in the Central Valley, a trend that spreads across the country.
Although not as high as its peak, the Lodi real estate market is still strong.
Dr. Frank Nothaft, the chief economist for CoreLogic was quoted as saying “This increase is primarily a reflection of rising home prices in Lodi, which drives up home values, leading to an increase in home equity positions and supporting consumer spending.”
Columbus OH
The Columbus OH real estate market grew more more than fifteen percent to over $150 Billion dollars in 2017. With the median home value in Columbus rising over seven percent year over year. The massive growth can be attributed to the affordability of the Columbus area, with the median home price at just over $200,000. The relative affordability of the homes in Columbus, coupled with the tremendous increases in property value has enticed many people to purchase a second home in the area.
Boston MA
The Boston real estate market has seen some bad press because of the massive rise in home prices in the Greater Boston Area. With the average home price in Boston proper being over $900,000 and the average dollar per square foot exceeding $820. With real estate prices that high and continuing to rise, to own any home in the city of Boston, regardless of size or amenities, can be considered a luxury home.
Panama City Beach FL
Panama City Beach Florida is another coastal area that has seen tremendous growth in their real estate market in 2017. With a tremendous influx of insurance money flowing in from hurricanes over the last few years has created a very fresh set of condominium inventory and has many longtime homeowners thinking of selling their home in Panama City Beach. One real estate broker was quoted as saying “with the numerous hurricanes and beachfront property damage in the last 3 years, almost every home and condo has been rebuilt, we are looking at almost an entire new city of properties to sell…and they are selling fast.” The combination of the overall economy driving tourism coupled with the fresh inventory, the Panama City Beach real estate market has flourished.
Dallas TX
The Dallas – Fort Worth real estate market has been on this list for many years. With some Dallas residents waiting for the market to cool off because of the ever-increasing home prices, the D-FW housing market is still seeing homes sell at some of the fastest rates in the country. Dallas has seen a tremendous shortage of housing inventory over the last few years.
The Dallas real estate market has seen consistent growth.
Currently, the Dallas market has about a 3 month supply of homes – which is approximate half of what is considered a “balanced market”. In addition, home values have gone up by more than forty percent in the last four years – which is one of the strongest streaks in real estate.
San Diego CA
California makes the list again with San Diego. Although the San Diego market saw a slight slow down toward the end of 2017, they still pulled $530,000 for the average home there. That is still not even close to the peak of the Sand Diego real estate market, which was in 2005, with an average home price of $643,000. Although substantially more than what is found in other parts of the country, many see the current Sand Diego home prices as a “bargain” which is keeping the supply of homes low with the demand high. Many investors look at the current prices as a steal and scoop up new homes as soon as they hit the market, not even digging too deep to find the perfect property — just anything that is not in a bidding war.
2017 Was a Good Year For Real Estate
Overall, 2017 was a great year for real estate. Many expect 2018 to also be another stellar year. One of the major changes in real estate for 2018 over 2017 will be the repercussions of the newly passed tax bill. With the new tax laws, as they pertain to real estate, we are expecting to see many of the more expensive real estate markets such as Boston and San Diego to slow down. Many real estate economists feel that the best real estate markets for 2018 will be the more middle of the road markets that won’t be has heavily affected by the new tax laws. We shall see.
Many people end up confused when it comes to finding a REALTOR – how do they know that they are picking the right one when there are so many of them around? Looking at properties is the fun part of purchasing a home. There is quite a bit more that goes into a real estate transaction and you want to insure you have someone looking out for your best interest.
SPECIALTIES
One thing to keep in mind is just like in any other industry, many real estate agents have areas of expertise. Some REALTORS may specialize in listing waterfront homes, some specialize in working with first time buyers, lakehomes some may have a depth of knowledge in condos.
In addition to the the types of real estate transaction, you will find some agents will have more experience in the city where others focus on the outlying areas, subdivisions and suburbs. There are very different skill sets when working in a metro area than working neighborhoods. You get even a different specialty when looking for vacant land or in even waterfront homes as opposed to Brownstones in a heavily populated area.
As your agent what their specialty is. If they say “everything” – for smaller areas that may be true – but in larger real estate markets, agents generally end up working the same types of real estate transactions on the same types of properties.
luxury homes
Finding an Agent
It is true that finding a real estate agent can be hard, but if you know what you are looking for you will be able to find a realtor who will help you sell your home fast and for a good price. Here are top tips on how to find a real estate agent:
Make sure that you choose a professional. While many people identify themselves as REALTORS, not all of them are members of the National Association of Realtors. Ask them to show you their membership card. It helps if they are members of other professional associations.
You want to find a real estate agent who has the right amount of experience. If you go with a REALTOR who is still learning how to sell homes you may end up having to wait for a long term before you can find the right buyer.
When you are looking for a REALTOR you should be looking into those that work in your neighborhood. Not only do they know who is in the market for a new home, they also know the buying trends of the market around you and they will help you sell your home for the right price.
A good REALTOR provides a comprehensive package. They will provide you with advice on how best to stage, they will bring in the right professionals to do repairs, they will help with valuation and they will also help you with all the paperwork that comes with selling your home. You may find that there are some who charge less because they don’t offer these services – it is not a good idea to go with such a realtor because it means that all these little additional tasks become your headache.
Choose a REALTOR who is within your range, Say, for example, that you want to sell your home for about $500,000 – you will not have an easy time of it if you choose a REALTOR who deals with high end homes that sell for millions.
If a REALTOR says that they are able to sell your home for a lot more than its valuation be wary – if your home is listed for a lot of money it will stay on the market a lot longer.
Good REALTORS are also good communicators – they will listen to you so as to understand your expectation and they will also talk to you often to let you know what kind of progress they are making finding prospective buyers. On your part let them know how you would prefer that they communicate with you – should they call, text or email?
Lastly, make sure that you are not paying your REALTOR more money than you should. Find out what the average rates are so that you can negotiate a good deal for yourself. Make sure that the realtor you choose doesn’t have any hidden costs.
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With the purchase of a home being the largest transaction of most peoples lives – choosing a REALTOR is an important decision. Real estate is very litigious and there is a ton of paperwork and with so much money at stake, you want to trust the person driving.
