Home sellers in the United States have benefited from record high prices this decade amid a combination of low housing inventory and fierce competition for available units.
But their own costs have risen as well. In fact, many sellers underestimate their costs by tens of thousands of dollars, according to a new survey from online home sales platform Clever Offers.
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The survey of more than 780 recent home sellers, released in mid-September, found that respondents expected to pay an average of $18,557 on home-selling expenses. In reality, they spent more than triple that amount, with average costs of $67,245.
On the bright side, those high costs can pay dividends if they boost the sales price and ease the process. Here are six home selling and moving expenses that provide the best return on investment (ROI), according to the Clever Offer survey results.
Repairs, Improvements and Renovations
- Average cost: $21,024
- Percentage of respondents who said this provides best ROI: 31%
Nearly three-quarters (71%) of sellers made pre- and post-listing repairs, improvements and renovations to their homes. The vast majority (92%) followed their agent’s advice on repairs and improvements, and more than half (52%) said the repairs resulted in a higher sale price.
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Commission Costs
- Average cost: $27,895
- Percentage of respondents who said this provides best ROI: 17%
Sellers typically spend 5% to 6% of the final home sale price on commissions to realtors, according to Clever Offers. This is split evenly between the buyer’s and seller’s agents. Sellers can reduce their commission costs by opting not to pay the buyer’s agent fee, but many go ahead and pay it to attract more buyers and speed up the sale.
Closing Costs
- Average cost: $8,217
- Percentage of respondents who said this provides best ROI: 15%
Closing costs tend to fluctuate based on factors such as location and lender requirements. These costs are a standard part of home sales, but they’re not always easy to understand. This partly explains why about one-quarter of sellers believe they overspent on closing costs.
Marketing and Staging
- Average cost: $2,393
- Percentage of respondents who said this provides best ROI: 17%
More than one-third of sellers (37%) tried to cut costs by skipping services such as staging, cleaning and photography. But most say these services are worth the expense.
Moving Costs
- Average cost: $2,439
- Percentage of respondents who said this provides best ROI: 11%
Obviously, selling one house and relocating to another involves moving. The ROI in this case comes from spending a little extra to hire a moving company and make the process easier and more efficient.
Concessions to the Buyer
- Average cost: $5,277
- Percentage of respondents who said this provides best ROI: 10%
Negotiating a home sale involves give-and-take with the buyers, and a large percentage of sellers (80%) are willing to make concessions to complete the sale.
Of the sellers who did make concessions, they were most likely to attract buyers by doing the following:
- Reduce the price (27%)
- Offer a flexible closing date (26%)
- Make repairs or offer repair credits (25%)
- Allow an early move-in date (16%)
- Include personal property in the sale (16%)
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This article originally appeared on GOBankingRates.com: It Costs More Than $67K Just To Sell a Home — These 6 Expenses Give You the Best ROI
