How do homeowners lose money when selling their home? There are several factors to consider, including closing costs, property taxes, staging the home, and Capital gains tax. This article will cover some of the most common pitfalls that homeowners experience. You may be surprised by what you find. In addition, you’ll find out why selling your home costs more than buying it. Read on to learn how to avoid making these common mistakes.
Closing Costs
If you are selling a home, there are several costs that are common. The seller typically covers the closing costs. These costs include the closing fee, transfer taxes, attorney’s fees, recording fees, and any property taxes. However, the costs may not be included in the price of the home. You can negotiate these fees with the buyer. Alternatively, you can look for cash home buyers. When negotiating closing costs, it’s important to understand the terms and conditions of each expense.
One way to reduce closing costs when selling a home is to hire a buyer’s agent. A Clever Flat fee real estate agent is a great choice for a buyer because it matches them with top-rated agents. They charge a fee of about $3,000 – one percent of the sales price – and this can save sellers thousands of dollars. The website also walks sellers through typical closing costs and offers tips on how to save.
Property Taxes
If you’re unsure of how much money you’re losing when you sell your home because of unpaid property taxes, read on to find out why you might be losing money on your property. Unlike mortgages, property taxes are paid through escrow accounts, which your lender will set up. Then, you’ll be responsible for paying your property taxes separately from your mortgage. Sometimes, homeowners don’t bother paying their property taxes at all and end up losing money on their sale.
In many states, real estate taxes are levied on the assessed value of the property, so that the government can fund its services and infrastructure. Depending on where you live, property taxes can run as high as 10% of the sale price. This is a big problem for homeowners, as they may not have enough money to cover all of their property taxes before the sale. In such cases, you may need to pay off your taxes before you sell your home to cover the taxes.
Cleaning and Staging
Most home buyers start their house hunting on their phones. The process of cleaning and staging the home for sale is much the same. Start with a basic clean and add additional cleaning as needed. According to a survey by Halstead Property, half of all sellers reported that staging their homes added between one and 20 percent to their home’s value. Investing in professional staging is a wise choice, but it is not a must.
While you can do some home staging yourself to make your home look appealing to potential buyers, professional stagers may charge more than you realize. For example, if your home looks untidy and cluttered, a staging professional can charge a minimum of $1,200 to stage your home for you. This can range from $500 to $2,000.
Capital Gains Tax
If you are thinking about Homes for sale in Baton Rouge in the near future, it’s important to know the rules and potential exemptions for capital gains tax. Most of the time, your capital gains will be less than your total expenses, and will therefore be exempt from capital gains tax. In some cases, however, your capital gain may be higher and you’ll need to report it. Before selling your home, make sure you understand the rules and the benefits of keeping records and receipts.
For example, you may want to consider filing a claim for the exemption if you’ve lived in your home for two years. The IRS allows for prorated exclusions for situations like divorce or natural disaster. However, the residency doesn’t need to be consecutive; it only needs to be for 24 months over five years. In such cases, it’s best to seek the help of a tax professional.
Cleaning and Staging
Most home buyers start their house hunting on their phones. The process of cleaning and staging the home for sale is much the same. Start with a basic clean and add additional cleaning as needed. According to a survey by Halstead Property, half of all sellers reported that staging their homes added between one and 20 percent to their home’s value. Investing in professional staging is a wise choice, but it is not a must.
While you can do some home staging yourself to make your home look appealing to potential buyers, professional stagers may charge more than you realize. For example, if your home looks untidy and cluttered, a staging professional can charge a minimum of $1,200 to stage your home for you. This can range from $500 to $2,000.
