Selling a home doesn’t come cheap these days.
Home owners across the U.S. will have to spend more than $15,000 in extra or “hidden” costs to sell a median-priced home, according to a recent analysis from real estate website Zillow and services marketplace Thumbtack. These expenses include agent commissions and sales taxes. Additionally, more than 80% of home sellers make some sort of home improvement before listing the house. “For those planning to sell this year, take your time to research all the costs you could be responsible for and how they may affect your profit, or even budget for your next home,” Jeremy Wacksman, Zillow’s chief marketing officer, said in the report.
To produce the report, Zillow calculated transfer taxes with state tax rates and assumed a 6% agent commission, applying those to the median value home in different metropolitan areas. To gauge the cost of home prep, Thumbtack studied tens of thousands of quotesfrom small businesses around the country and determined an average cost for each expense in the selected cities. The home maintenance projects Thumbtack used for the analysis were carpet cleaning, interior painting, lawn care, home staging and house cleaning.
And as with other issues in real estate, when it comes to the costs of selling a home location matters. Nationally, sellers spend $12,532 on average in agent commissions and sales taxes. But in an expensive market like San Francisco, sellers pay more than $51,000 for a median-priced home (since these costs are calculated as a percentage of the property value.) For sellers in less pricey markets, such as Indianapolis, these expenses can dip below $9,000.
For home maintenance projects, the cost of labor will similarly vary based on where a home owner lives. Sellers in Los Angeles will pay an average of $4,000 for home improvement projects, while a family in Columbus, Ohio, would only shell out $1,500 for the same work.
So which home owners can expect to pay the most? It’s bad news for those living on the West Coast.
Metros with the highest hidden costs for selling a home:
While these hidden costs do cut into the profit home owners can make from selling — or the amount they can spend on a new home — it doesn’t seem to affect their satisfaction with the home selling process. According to Zillow, 73% of sellers report satisfaction with their transactions.