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Cost Of Selling Home In The Current Market
Friday, July 8, 2011
The real cost of selling your home in the current market will depend on many factors which include broker's commission, unpaid mortgage, taxes and the necessary cost to repair and renovate in order for your home to be saleable. I want to sell my house fast , but like in your case, considerations must be made first if the profit to be netted from sale would be enough to buy a new home or even for a down payment of a new one.
First, you have to consider the equity and the balance of your mortgage loan and the current market value of a home similar to yours. After considering these values, you can start calculating the cost of selling your home. If we
assume that the current selling price of your home is $350,000, you will have the following costs for deduction:
Broker's commission 5-7%
You will have to enlist a broker or realtor, which is necessary in order to sell your home right away. If an average commission for a broker would be around 5 – 7% you will have cost of $17,500 to $24,500, an average of $21,000 cost.
Unpaid Mortgage - depending on the number of years of amortization
If your mortgage loan is up to 10 years and you have 2 years remaining, you still have about 20% unpaid loan from the original value of your house. And if you have bought the house at an original selling cost of $325,000, 20% of unpaid mortgage from that would be $65,000, a remaining loan which you have to pay after selling the house.
Repair and Renovation 3%
You can't put a good value to a house that is not in good form, which is why you need to invest to bring your home to a saleable condition. Although you can still sell you house on an as-is-where-is basis, at least allocate a cost of 3% or $10,500.
Taxes 2-4 %
Property tax, transfer fee tax and other legal fees would be around 2-4% of your current house value, that would be about $10,500 depending on taxes applicable to your location.
Adding all these figures, the cost of selling my home would be around $107,000. Given the sales value of $350,000, the net profit from sale is around $243,000. The simple calculation effectively shows that to sell my house fast is costly. But the remaining value after the cost is enough to start a new home and buy new things for a prospective house.