Buy low, sell high. Everything in between is profit right? If only! There are many costs involved when selling a house.
Back in April 2021 our family of Steph, Me and our pup Nesta grew with the arrival of our Twin baby boys Leon & William. Shortly after we arrived home with our son’s and got settled in we began to feel as though our house got smaller. Not to say we’d have it any other way but the place just got 2 more people living in it!
We have lived in our house together for 6 years now, just the 2 of us (plus pets). A modest 3 bedroom home in Sydney’s South West. The place has been great and we’ve created memories there that will last forever. However the time soon came with our boy’s arrival that we needed to consider an upsize.
After much deliberation we decided to undertake the stress of selling our house to move on and buy our next, which would be our forever family home. In this article I’ll breakdown the process I went through and all the costs involved when selling a house.
Selecting An Agent
Not all real estate agents are created equal. When selecting an agent it’s always a good idea to play the field. Meet with a few, find out what they offer and use the competition in the industry to your advantage.
Realesate.com.au is Australia’s No.1 property site for real estate and a very useful free tool when deciding which agent to go with. Real estate can give you a full list of all the agents actively selling homes in your area.
Once we decided to sell I contacted 3 agents in my area and requested to meet with each of them to discuss our plans to sell.
Here’s a quick breakdown of how it went:
Great guy, wanted to know much more than just how much money we can make on our sale. Seemed to be very knowledgeable in the market. Charged 2.2% commission on final sale price + $2,700 marketing
Rushed the entire meeting, was polite but seemed uninterested in me, more on just how much money the sale can make. Promised a quick sale. Charged 2% commission on final sale price, no marketing fee.
Great guy, stayed for a longer chat than both to show us potential properties in the area. Similar properties than sold. Gave us plenty of information about the current market prices. Answered every question we had. Charged 2% commission on final sale price + $2,300 marketing.
Being our first time selling a house we wanted to have the confidence in our agent that he actually cared and we weren’t just another sale. So, we went with Agent #3. #2 was the cheapest but I got the feeling we would get much less value wise based on my initial meeting with the agent.
There are 2 types of agent fees:
- A flat fee that the vendor and agent agree on for the sale of the property. No matter what the property sells for, the fee is set.
- A percentage of sale fee where the agent gets a percentage of what the property sells for. This ‘commission’ can range from 1%-3% depending on current market conditions.
A marketing campaign is usually recommended when selling and is the second of our costs when selling a house.
The agent we chose charged $2,300 for our marketing campaign which included brochures, a floor plan, the big sign out the front and listings on Australia’s real estate websites including Domain and Real Estate. It also covered the process of having a photographer come through and take tonnes of photos for the listings.
Marketing campaigns can cost anywhere up to $10,000 depending on the property. This price will entirely depend on the agent. However, from my research in Sydney’s South West the cost range is around $2,000-$3,000.
Conveyancing is all the legal stuff that goes on in the process of selling. It is the process of transferring legal ownership of a property from one person to another. This is required in every real estate purchase, obviously.
Hiring a conveyancer is not technically ‘legally’ required but unless you are a solicitor yourself it is commonplace to have someone cross the t’s and dot the i’s for you.
The settlement process is a very complex one, a conveyancer is a licensed professional who specialises in providing advice and information on the sale of a property. They take care of all the stuff you don’t want to know about.
Conveyancing services range from $800-$2,000.
Among the costs involved when selling a house we never considered how much we would have to pay the bank.
We still had a mortgage on the property so that would need to be paid out and the bank would have it’s own early discharge fees for doing so.
Discharge fees can range from $150-$1,500 depending which financial institution the mortgage is held with.
From meeting with different agents, selecting one and signing contracts to sell we spent around 4 days doing so. Then it took another 4 days to book in the photographer which gave us that time to get our house ready for photos.
We spent 2 days decluttering our house getting it ready for the photoshoot. Everything that wouldn’t look good in a photo we packed away into the garage. It was exhausting.
The time it takes to sell a house will depend on the current market conditions. The market in Sydney at the time of our open house was red-hot. We got multiple offers and sold off our first and only open home.
In total, from the time we met with the first agent to the time of signing the contract of sale on our property was around 3 weeks.
The silent predator of costs involved when selling a house. The entire process for us first time sellers was costly on our stress levels. We were still new parents and found it tough juggling the time between our boys and getting what needs to be done, done.
Everything from working out how we are going to pack our house to feeling anxious about groups of total strangers going through our home was not a fun process. A necessary one. But I wouldn’t consider it fun at all.
We got through it though, with many lessons learned about the efforts it takes and what’s required.
Costs Involved When Selling A House
There are many costs involved when selling a house, not all of them monetary.
In short you can expect to pay:
- Agent Fees
- Conveyancing Fees
- Marketing Fees
- Lender Fees
But don’t forget the cost on your personal Time and Stress neither which are equally, if not more important that any monetary costs. Also, you should consider how you can lower your costs when moving into a more expensive property.