What Are the Costs Involved When I Sell My House?

[James Klinger]

Selling a house involves multiple expenses, and knowing these costs can help you make informed decisions, budget better, and understand your net profit once the sale is complete. For those selling their homes in Australia, the process has its unique nuances, and "Sale by Home Owner Australia" offers tools to help streamline your sale. Here, we’ll look at the main costs involved when you decide, “I want to sell my house.”

1. Real Estate Agent Fees

• Alternative Option – Sale by Home Owner Australia: Some sellers choose to manage their sale independently to avoid agent commissions. "Sale by Home Owner Australia" provides a platform and tools to help homeowners handle the sale process directly, which can save thousands. By selling your home privately, you can cut out the middleman and manage everything from advertising to negotiation on your own.

2. Marketing and Advertising Costs

• Photography and Videography: A key to selling a home is professional photos. High-quality images attract more buyers and increase online engagement. Professional photography can cost between AUD 200 and AUD 500, while videography or virtual tours add an extra AUD 300 to AUD 1,000, depending on the level of detail you want.
• Listings and Signage: To reach the largest number of potential buyers, it’s essential to list your property on popular real estate websites. Listing fees vary depending on the site and package but can range from AUD 100 for basic listings to AUD 1,000 or more for premium spots.
• Other Marketing Tools: You might also consider newspaper ads, letterbox drops, and open house signs, which add to the cost. On average, comprehensive marketing for a property can cost around AUD 2,000 to AUD 5,000, depending on the property’s needs and the reach you desire.

3. Legal and Conveyancing Fees

• Hiring a Conveyancer: Every home sale requires legal expertise to ensure a smooth transaction. A conveyancer or solicitor manages the legal paperwork, conducts title searches, and facilitates the transfer of ownership. Their fees generally range from AUD 800 to AUD 2,000, depending on the complexity of the sale.
• Contract Preparation: Preparing a sale contract can involve additional fees, especially if your sale has unique stipulations or clauses. Some conveyancers include this service in their package, while others may charge separately, costing around AUD 200 to AUD 500.

4. Property Repairs and Improvements

• Pre-sale Repairs: Buyers are typically drawn to well-maintained properties, so it's often wise to invest in minor repairs or cosmetic upgrades before selling. This might include patching walls, fixing leaks, or updating light fixtures. Even minor improvements can cost a few hundred dollars but can add significant value.
• Major Renovations: If your property needs substantial improvements to appeal to buyers, larger renovation projects might be required. A fresh coat of paint, landscaping, or updating bathrooms and kitchens can significantly boost your home’s value but can cost from a few thousand to tens of thousands of dollars. Weighing the potential return on investment (ROI) for these updates is essential.
• Staging and Interior Design: Staging is another effective way to improve a home's appeal. Professional staging can cost between AUD 2,000 and AUD 8,000, depending on the level of service and size of the home. Staged homes often attract more buyers and sell faster, potentially leading to a higher selling price.

5. Home Inspection and Pest Inspection

• Home Inspection: A home inspection provides buyers with a clear picture of the property’s condition. Conducting this inspection beforehand and addressing any issues can give you an advantage in negotiations. The average cost for a building inspection in Australia is around AUD 300 to AUD 700.
• Pest Inspection: Especially in certain regions, pest inspections are a wise investment. A clean bill of health can reassure buyers, while addressing any issues before listing can save you from costly last-minute negotiations. Pest inspections range between AUD 200 and AUD 500.

6. Mortgage Discharge Fees

• Discharging Your Mortgage: If you still have a mortgage on your property, you’ll need to account for the discharge fees. Mortgage discharge fees can vary significantly by lender but usually range from AUD 150 to AUD 1,000. Some lenders also charge early exit fees, particularly if you have a fixed-rate mortgage and are paying off the loan early. Check with your lender to understand these potential fees.
• Calculating Final Payout: Before selling, ask your lender for the final payout figure, including any fees or penalties. This amount will be deducted from your sale proceeds at settlement.

7. Capital Gains Tax (CGT)

• Primary Residence Exemption: If the property you’re selling is your primary residence, you may be exempt from capital gains tax. This is a substantial saving, as CGT can be significant.
• Investment Properties: For investment properties, CGT is applicable and depends on how long you’ve owned the property and your overall income. Capital gains are calculated based on the sale price minus the purchase price and eligible deductions. If you’ve held the property for over a year, you may receive a 50% discount on the CGT, which can be a considerable benefit.
• Working with an Accountant: For those unsure about the CGT implications, consulting an accountant can be beneficial. Accountants’ fees vary, but this expense can provide peace of mind and help with tax deductions for the year.

8. Settlement Costs and Adjustments

• Settlement Adjustments: At settlement, certain costs, such as council rates, water charges, and strata fees, are adjusted between you and the buyer. These adjustments are typically managed by your conveyancer and can vary depending on when in the billing cycle the sale takes place.
• Buyer Incentives: In competitive markets, some sellers may offer incentives like paying a portion of the buyer’s legal fees or offering a reduced purchase price. While not mandatory, incentives can occasionally be an effective strategy if your property is slow to sell.

9. Other Miscellaneous Costs

• Removalist Fees: When planning to move out, factor in the cost of hiring a removalist, which can range from AUD 500 to AUD 3,000, depending on the distance and volume of belongings.
• Final Cleaning: A professional cleaning before handing over the keys is recommended. Cleaning services for a house typically range from AUD 300 to AUD 1,000, depending on the size of the property.
• Utilities and Insurance: Ensure that you budget for any last-minute utility bills or property insurance payments that need to be settled before the sale.

Maximizing Your Sale with Sale by Home Owner Australia

Opting to sell your property independently with "Sale by Home Owner Australia" allows you to minimize several costs associated with traditional real estate agents. By managing your sale directly, you gain more control over your listing and marketing while avoiding agent commissions. With the right tools and preparation, private selling can help maximize your profit without sacrificing quality. Additionally, platforms like "Sale by Home Owner Australia" provide guidance and access to essential resources, making the process more streamlined and accessible.

Conclusion

Selling a home comes with various costs, from real estate fees to legal expenses and repair costs. Being aware of these can help you manage your sale effectively and avoid surprises. By carefully budgeting and considering alternatives, such as using "Sale by Home Owner Australia" to bypass traditional agent fees, you can make your home sale a smoother, more profitable experience. Whether you choose the DIY approach or work with professionals, understanding each cost will help you make the best decisions as you navigate the selling process.