What are the Costs Involved in Selling My Home? A Detailed Guide for Real Estate Sellers

Selling your house is a significant financial transaction with several expenses. It is essential to comprehend these costs in order to make sure you are ready and can make the most money. The main expenses of selling a house are covered in this guide, which is relevant to all kinds of sellers—seniors in particular.

1. Real Estate Agent Commissions

The real estate agent commission is one of the biggest expenses related to selling a house. In Canada, commissions are normally divided between the buyer's and seller's agents and range from 3% to 5% of the transaction price.

• Seller’s Agent: This is the agent you hire to sell your home. Their commission is usually negotiated before listing the property.

• Buyer’s Agent: The commission for the buyer’s agent is generally a standard percentage and is also paid by the seller, however, this is NOT always the case. Please make sure to have a conversation with your realtor about the commission paid to the buyer's agent.

For example, if your home sells for $500,000 and the total commission is 5%, you would pay $25,000 in commissions.

2. Home Staging Costs

Staging your home can make it more attractive to potential buyers, potentially leading to a higher selling price and quicker sale. Costs can vary widely based on the level of staging required.

• Basic Staging: Decluttering and simple rearrangements can cost between $1000 and $3500.

• Full Staging: Renting furniture and decor for an average-sized home can cost between $5,000 to $10,000 or more, depending on the size of your home and the duration it’s on the market.

3. Decluttering

Decluttering your home is an essential step in preparing it for sale. This can involve:

• DIY Decluttering: Costs might include storage bins and supplies, which can range from $300 to $600.

• Professional Decluttering Services: Hiring professionals can cost between $1500 to $3,000, depending on the size of your home and the amount of clutter.

4. Repairs and Renovations

Making necessary repairs and minor renovations before listing your home can significantly impact its sale price. Costs vary depending on the condition of your home and the extent of the work required.

• Minor Repairs: Fixing leaky faucets, patching holes, and other small repairs may cost a few hundred dollars to $2,000.

• Major Renovations: Updating kitchens, bathrooms, or flooring can cost several thousand dollars. For example, a kitchen renovation can range from $5,000 to $20,000, depending on the scope of work.

5. Repainting

A fresh coat of paint can greatly enhance your home’s appeal. Costs depend on the size of your home and whether you do it yourself or hire professionals.

• DIY Repainting: Purchasing paint and supplies can cost between $200 and $500.

• Professional Painting: Hiring a professional painter can cost between $2,000 to $6,000 for an average-sized home.

6. Marketing Costs

Marketing your home effectively can help attract more potential buyers. While many real estate agents include basic marketing in their commission, you may want to invest in additional marketing efforts.

Our team of realtors at HouseShop.io offers different selling packages that include cost of basic marketing, advanced marketing, and premium marketing (for listings over $5 million).

• Professional Photography: Good photos are essential for online listings. Professional photography can cost between $350 and $550.

• Videography: A video tour of your home can attract more buyers. This service can cost between $450 and $1,000.

• Online Listings: Premium listings or ads on real estate websites may have additional fees, typically ranging from $150 to $500.

• Media Outlets: Advertising in local newspapers, magazines, or online platforms can cost between $100 and $1,000, depending on the outlet and frequency.

   

• Virtual Tours: Creating a virtual tour for remote buyers can cost between $300 and $1,000. Virtual tours allow buyers to view your home from anywhere at any time.
  

• Social Media Marketing:
  Instagram and Facebook: Posting your listing with eye-catching descriptions and high-quality photos can be free, but boosting posts can cost between $200 and $800 depending on the reach.
  LinkedIn: Sharing your listing with your professional network can help reach potential buyers. This is usually free but can also be boosted for a fee.
  Twitter: Using relevant hashtags and regular updates can help maintain visibility. Costs here are minimal unless you choose to promote tweets, which can range from $20 to $200.
  

• Build a Website for the Property: Creating a dedicated website with images, videos, and detailed descriptions for your property can cost between $100 and $200. This acts as a one-stop shop for prospective buyers.
  

• Email Marketing: Sending bulk emails to prospective buyers and real estate agents can cost between $100 and $300, depending on the email service provider and the size of the mailing list.
  

• Video Marketing:
  YouTube: Producing and uploading a virtual tour video can cost between $300 and $1,000. YouTube videos provide a detailed look at your home’s features.
  TikTok: Creating short, engaging videos showcasing your home’s best features can attract a younger audience. This is usually free, but professional video creation can cost up to $500.
  

• Publicity in the Local Media:
  Press Releases: Distributing a press release to regional publications and online news sources can cost between $400 and $1000.
  Community Newsletters: Placing ads in local periodicals and newsletters can cost between $50 and $200.
  

• Publicity in the Global Media (luxury listings): The starting cost of featuring luxury listings in global media is $5000
  

• Make Fliers: Printing and distributing fliers to nearby businesses and neighborhoods can cost between $200 and $400.
  

• Paid Online Ads: Targeting prospective customers with Google Ads and Facebook Ads can cost between $100 and $1,000, depending on the reach and duration of the campaign.
  

• Content Marketing: Writing blog posts about your home and neighborhood to attract buyers can cost between $100 and $500 if you hire a professional writer.
  

• Work with Influencers: Collaborating with local influencers to reach a larger audience can cost between $200 and $1,000, depending on the influencer's reach and engagement.
  

7. Legal Fees

Selling a home requires the services of a real estate lawyer to handle the legal aspects of the transaction. Legal fees in Canada typically range from $900 to $1,500.

• Document Preparation: Includes the preparation of the sale agreement and other legal documents.

• Title Transfer: The lawyer handles the transfer of the property title to the new owner.

8. Mortgage Discharge Fees

If you have an existing mortgage on your home, you will need to pay a discharge fee to close it out. This fee can vary depending on your lender and the terms of your mortgage, typically ranging from $200 to $600.

• Prepayment Penalties: If you pay off your mortgage before the end of the term, you may also incur a prepayment penalty. This can be substantial, often amounting to several thousand dollars.

9. Moving Costs

Moving expenses can add up quickly, especially if you are moving a long distance. These costs include:

• Professional Movers: Hiring professional movers can cost between $1,000 to $5,000 or more, depending on the distance and amount of belongings.

• Moving Supplies: Packing supplies like boxes, tape, and bubble wrap can add up to several hundred dollars.

10. Utility and Maintenance Costs

While your home is on the market, you will continue to incur utility and maintenance costs. These might include:

• Utilities: Electricity, water, gas, and internet costs.

• Maintenance: Lawn care, snow removal, and minor repairs to keep the home in showing condition.

• Property Insurance: Remember to have property insurance in place until title is transferred to the buyer. 

11. Taxes

Taxes can be a significant expense when selling your home, especially if the property is not your primary residence.

• Capital Gains Tax: If the home is not your primary residence, you may be subject to capital gains tax on the profit from the sale. 

• Land Transfer Tax: LTT is paid by the buyer.

• Other taxes … 

Important: Always consult with an accountant and a lawyer to understand your tax obligations and how to minimize them.

Conclusion

Selling a home involves a variety of costs that can add up quickly. By understanding these expenses and planning accordingly, you can avoid surprises and ensure a smoother selling process. Working with a knowledgeable real estate agent and a trusted lawyer can help you navigate these costs and make the most of your home sale.

Whether you’re downsizing, relocating, or simply looking for a change, being aware of these costs will help you better prepare for the financial aspects of selling your home. Don’t forget to seek advice from your accountant and lawyer to fully understand all the costs and tax implications involved.

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