Everyone wants his piece of the pie, right? In most business transactions of any considerable value, the seller and the buyer usually pay additional fees for numerous people or organizations to earn “pieces of the pie.” Simply put, we are no longer conscious of it. Even little, everyday transactions reflect this. Buying a new shirt, for instance. The price you pay frequently includes federal, state, and local taxes, the retailer’s profit, the middleman’s profit, and the original manufacturer’s profit. If this is true on a small scale, you can expect that it will also be true in expensive transactions like home sales.
Don’t Let These Expenses Surprise You When Selling Your Home
If you sell your home the traditional way, you can give up sizeable chunks of the profit. If you’ve never sold a house before, these expenses could come as a huge shock. We want you to be aware of these costs and the potential financial impact of passing up the pie. Here are a few common costs and pricing.
Even if it’s not necessary, a pre-inspection is usually a good idea when selling a house, especially if it’s an older house.. According to Zillow, about 15% of home contracts fall through due to issues found by the buyer. Any number of issues, including termites, undetected mold, roofing issues, or electrical issues, may be present. The seller may be able to find any faults that need to be addressed or dealt with beforehand with the use of a pre-inspection. While retaining the terms of the final agreement, this can expedite the sale and inspire trust in potential buyers. According to Manta, the typical cost for an inspection in Pennsylvania, PA is somewhere between $209 and $471 depending on the size of your home and other factors.
If you use the services of a realtor to sell your home, or even if you choose to sell the home yourself (FSBO) but if you sell to someone who is using a realtor, you’ll probably have to pay the realtors involved a commission on the sale. Real estate agents work hard to earn their commissions, but depending on the situation, their efforts on your behalf to sell your property could be beneficial. However, there is a price to pay. According to a Clever, the average realtor fee in Pennsylvania in 2022 was 5.53% which is higher than the national average at around 5.35%. As an example, a house selling for $235,000 in Philadelphia would likely incur realtor commissions of about $12,455. You may be interested in trying to avoid a real estate agent when selling in Pennsylvania. Even if you sell your home at auction, there will be fees as well.
Sellers will once more find themselves in situations where they need to negotiate for the sale of their property if the housing market shifts back to more of a buyer’s advantage type market, as many experts expect for the upcoming year. In recent years, when the seller was in a better position due to the market, they could usually sell the house without making any adjustments for defects in the building. Buyers had to “take it or leave it” for the buyer in line behind them since they were so frantic to find a property they liked. However, if the market starts to change, sellers can once more find themselves having to dramatically lower their asking price due to issues an inspection found with the home. Although it’s not strictly a fee, this reduces your profit.
Before selling, older properties generally need some renovations. It can include expensive repairs to the plumbing, electrical, roof, basement, or foundation. Even small additions like new paint, carpeting, and landscaping can soon add up in terms of expense and time required to complete the project. If you choose to forgo repairs, you should frequently be prepared to lower your asking price or see potential buyers walk away in search of a move-in-ready property.
Property taxes are a recurring expense for homeowners in Pennsylvania, and sellers are responsible for paying them up to the closing date. The amount of property taxes owed at the time of sale depends on the property’s assessed value and the timing of the sale. Property taxes are typically assessed on an annual basis. Property tax payments are usually prorated between the buyer and seller based on the number of days each party will own the property during the tax year. For example, if the property tax year begins on January 1st, and the sale closes on July 1st, the seller would typically reimburse the buyer for the taxes owed for the first half of the year.
Pennsylvania imposes a real estate transfer tax, which is a significant cost in the home selling process. The transfer tax is typically shared between the buyer and seller, and the specific rate can vary by county and municipality. However, it’s commonly around 1% of the property’s sale price. For example, if you’re selling a home for $200,000, the transfer tax could be approximately $2,000. The buyer and seller may negotiate how this cost is split, but it’s often divided equally between them. It’s important to note that the Pennsylvania Department of Revenue requires a Realty Transfer Tax Statement (Form REV-183) to be filed with the deed at the time of recording.
Title insurance is a crucial aspect of the home selling process. It is designed to protect both the buyer and seller from potential issues related to the property’s title. Sellers typically provide a title insurance policy to the buyer to ensure that the property has a clear and marketable title. This means that the property’s ownership history is free of legal disputes, liens, or other encumbrances. The cost of title insurance can vary based on the property’s sale price and the title insurance company’s rates. Typically, the seller pays for the buyer’s title insurance policy, while the buyer may have the option to purchase additional coverage.
An Option to Avoid Many Of These Fees
717 Home Buyers in Pennsylvania offers the option to acquire your house in its current condition for cash. 717 Home Buyers might be a perfect option for you if the circumstances are right, which means that your home requires repairs, is old, needs cleaning up, or you need to sell it soon.
By selling to 717 Home Buyers for cash, you can avoid paying commission to real estate agents, prospective repair costs, inspection fees, legal fees, and closing costs. There are no fees or commissions involved, and no upkeep or cleanup is necessary. In addition, we can typically finish the deal in a week.
Call us on 717 Home Buyers. We specialize in helping homeowners in situations just like this. We can save you a lot in unexpected fees and taxes.
We will have one of our professional team members assess your home and it is likely that we can offer you a cash purchase with no repairs, title insurance, inspections or extra fees. If we make you a cash offer and you accept, we can often close the deal with the title company in as little as a week.
You can learn more about our methods of operation and check out our outstanding reputation. If you are tired of dealing with fees and finances in Pennsylvania and want another option, give us a call today at 717-639-2164.