You’ve saved your deposit, you’ve scoured property listings and found ‘the one’, it’s time to sell your house and move on. If only it were as simple as it sounds.
Your home is likely your most valuable asset, so of course you want to get the best possible price for it. Though on the surface, selling your house seems like the ultimate payday, there are a number of hidden costs involved in getting the best deal that can catch a seller off guard.
Marketing and agency fees
Typically, real estate agency fees can be divided into two categories: marketing fees, and agency commission. The commission pays for the agents time and their labour on the sale. Think organising marketing, hosting inspections, following up interested parties, setting up contracts. Everything from putting the house on the market, through to slapping the ‘sold’ sticker on the sign rider. Commissions in Australia vary broadly between 0.90% and 4%, though the agent can effectively charge what they want. The commission percentage will vary based on the location of your property, and is not necessarily dictated by the property’s value. The more agents operating within a postcode, the lower their commission rate is likely to be. Similarly, in a suburb with less agents, such as a rural town, commissions will be higher. For example, the average real estate commission in Toorak is 1.4%, while the average real estate commission in Bendigo is 2.58%.
Marketing fees are the costs not directly pocketed by your agent, rather these are the tools that assist in selling the house. These costs include listings on real estate websites and in print media, photography and copywriting for the listings, and even video content. And of course, the board at the front of the property. Basically, this is the cost of getting as many potential purchasing eyes on your listing before sale. Although the costs will vary from property to property, as a general rule you can expect to pay 0.5% to 1% of your sale price on marketing costs.
Selling your property at auction comes with a variety of benefits. Not only is there the chance to push the sale price up through a bidding war, but you are protected by your reserve price, and are able to set many of your own terms and conditions to the sale. Although it’s near impossible to predict the result of an auction, the value of the auctioneer themselves is more clearcut. All that charismatic fast-talking will typically set you back between $400 and $1000. If an auctioneer describes their service as ‘free’, expect it to be included in your commission fee.
Preparing your home for the sale – cleaning, styling and repairs
If you’re selling, now is the time to get your house in tip top shape. It’s this point in the process that is hardest to define a cost for. It will vary based on the size, age, and condition of your property. A lick of fresh paint and a tune up to ageing fittings such as doorknobs, fly screens and dated blinds can elevate a property, and show that it was a well cared for home. Meanwhile, electrical and plumbing repairs are a must, a leaky tap is not a selling point.
Of course, the house needs to be clean. You can expect to pay somewhere between $40 and $50ph for a professional cleaner, with a big initial clean before the house is photographed for sale, and then ongoing maintenance. In order to declutter the space and allow for more efficient cleaning, you may want to put your possessions into storage, with mobile personal storage starting at around $99pm. The garden should get some TLC too, with gardeners setting you back around $50ph.
And last, but not least, styling your property. Creating a visual marketing tool will increase the potential value of your home and attract the most amount of buyers. Professional styling costs start from around $2,000 and can range well into the tens of thousands. However, with a little research you can make a few tweaks that can make all the difference at a fraction of the cost.
You’ve finally found a buyer for your house, but don’t get too relaxed, there’s still a way to go. It’s time for settlement, and the complex legal process of transferring ownership of a property. This is called conveyancing, and though technically you could tackle the paperwork on your own, it is best handled by a lawyer known as a conveyancer. Generally a conveyancer will set you back anywhere from $500 to $1400. Keep in mind that if you attempt the process solo to avoid this fee, any mistakes could cost you the sale.
Loan discharge fees
If you’re selling your home, chances are you still have a mortgage, and may be in the position to pay off the loan earlier than expected. Depending on the timeframe, you may be required to pay exit, settlement and discharge fees. These generally range between $150 to $600, though many factors contribute to each unique circumstance.
Want to purchase and settle on the same day?
There’s a lot that goes into buying and selling homes. It’s one of the biggest choices a person makes. If you’re looking to streamline the process, purchasing and settling within 24 hours, get in touch with us at Accru today and we can help you make this happen.