Are you in the process of selling your house in New Jersey? It is important to take into consideration all of the costs associated with selling your home to make sure you are walking away with the money you need to move forward to the next chapter of your life. Regardless of whether you select to work with a professional real estate agent or sell on your own, you’re likely to run into most of these expenses. We will explore the big five costs to be aware of when selling your house in New Jersey.
1.) Commissions
Most people understand that when selling their home through the traditional process (a.k.a to list with a Realtor), they expect to pay commissions. That is because the agent’s commission is by far the most expensive closing cost associated with selling a home. The standard commission averages around 5%-6% of the sale price, which means that selling a home with a $300,000 price tag will cost you approximately $15,000 to $18,000. That is a big chunk of mula, which is why some sellers decide to list their house on their own via the for-sale-by-owner (FSBO) route. I would advise against this unless you have potential time to waste just to see what happens. The fact of the matter is, most buyers are working with a buyer’s agent. Even if you did find your own buyer, the probability is high that they are working with an agent already and will utilize their services for your transaction. This means you will have to pay the buyer’s agent around 2% to 2.5% of your agreed-upon sale price. The bottom line is that more likely than not, you will be paying a commission to an agent. If you do get lucky and find a buyer without paying a commission think of it as just an added bonus.
2.) Marketing Expenses
The name of the game with getting your home sold as fast as possible in New Jersey for the most amount of money is in the marketing plan. In order to set yourself up for success, you have to have a good marketing plan together and this requires a little bit of money. If you do decide to list your home with a Realtor, your listing agent will include these expenses as part of their service offering since you have agreed to pay their selling commission. If you don’t hire an agent, then you should expect to allocate monies toward marketing expenses. Some of these expenses include professional photography which can range from $150 to $500 dollars depending on if you just wanted pictures and/or a virtual tour. If the house is currently empty, I would consider professional staging which will range from $2,000 to $3,500. I would also consider hiring professional cleaners which can cost anywhere from $150 – $500 depending on the size of the home. In real estate, it is all about making a good first impression, so it really is worth spending the money to make sure your house is pristine and ready for prospective buyers.
3.) Repairs
If your home is in need of repairs, it is best to complete them before putting your house up for sale. The obvious repairs will inevitably show up on a buyer’s home inspection report and therefore it is less of a headache to get them down now than later. Plus, it is also prudent to minimize as many roadblocks and objections for buyers as excuses to not want to buy your home. One idea is to invest in an “informal home inspection” before embarking on hiring contractors to begin work. This will let you know what to prioritize first and what items will most likely be picked up on a buyer’s home inspection report. Ask around to see if any local home inspectors will do this for you, and usually, they will charge you about half of what a formal home inspection would typically cost. When it comes to selling a home in general, don’t be surprised when a buyer comes back with a repair request list. This is part of the closing process and it is entirely negotiable. Expect to have to accommodate at least some of the repairs or be prepared to offer a credit at the closing table. This is unfortunately all part of the process when selling your house in New Jersey the traditional way.
4.) Carry Costs
Carry costs are also known as holding costs, and these are the costs of “holding” onto the property until the home is officially sold. These are expenses such as mortgage payments, property taxes, monthly association dues, garbage, water, sewer, utility, and regular maintenance expenses. Many times if the home is initially overpriced, the listing can become stale and resultingly the home can sit on the market. Once this happens, the carry costs can really start to add up and should be a factored cost when selling your home. It is wise to budget for at least some carry expenses and be sure to price the home correctly in the beginning to avoid a stale listing.
5.) Standard Closing Costs
Closing costs are the typical costs when selling a home in New Jersey. On the seller side, you will be responsible for items such as the NJ State transfer tax which is typically around 1% of the sale price, any HOA fees if you live in a community with an association, attorney fees which can cost upwards of $1,500, and miscellaneous title expenses such as mortgage discharges, wire fees, etc.
It is very important to be aware of all the costs when selling your house in New Jersey, in order to ensure you net enough money toward your next chapter in life. If you want to learn about another option that will help reduce the time and stress of dealing with closing costs, you can reach out to us anytime. With a direct sale to Halo Homebuyers, closings are quick, usually within 20-30 days or less and you don’t need to worry about repairs. We will also take on the majority of the closing costs so you don’t have to, and can purchase your home as-is. Send us a message or call us at (908) 547-0404 today to find out more!
