The Cost of Selling a House: What to Expect and Budget For

Selling a house is a significant milestone, and is often equal parts exciting and stressful for property owners. While many Sellers focus on the final sale price they hope to achieve, it’s important to also consider the various costs associated with selling a property.

Understanding these costs can help you make informed decisions and set realistic expectations. In this article, we’ll give you an idea of the upfront costs you should be prepared for when selling your home.

Key Takeaways:

When considering selling a house, make sure you have accounted for;

• Real estate agent commission
• Marketing costs
• Moving costs (if relevant)
• Any potential tax implications
• Conveyancing fees
• Settlement fees
• Mortgage discharge fees & other lender fees (if relevant)

Real Estate Agent Fees and Commission

Real estate agent commission is the amount agreed between the seller and the real estate agent to be paid to the agent on the settlement of the property. It is usually charged as a percentage of the final sale price.

The seller and real estate agent sign an agreement (known as a Form 6 in Queensland) before the agent begins to market the property that sets out the amount of commission and any other fees payable ahead of time.

For an indication of what your real estate agent fees are likely to be based on your expected sale price, visit our real estate agent commission calculator.

Marketing Costs

Your real estate agent will have ideas about how to best market your property to attract potential buyers, and should be familiar with strategies that have worked well for similar properties in your area.

Marketing costs can range from $800 – $3,000, and can include photography, videography, a real estate listing on popular home sales websites such as realestate.com.au or domain.com.au, printed brochures and flyers, signage and social media.

Auction Fees

If you elect to sell your house by auction, there will be an additional fee to pay to the auctioneer. If this applies to you, talk to your selling agent to find out what the costs involved are likely to be.

Moving Costs

If you are selling a house you are currently residing in, you should factor removalists into the costs.

Potential Tax Implications

Capital gains tax will apply if the property you are selling is not your primary residence, and you make a profit on the sale. The amount of tax payable will depend on a number of factors, including how long you’ve held the property for, expenses you’ve incurred holding and selling it, and the applicable marginal tax rate.

See our capital gains tax calculator for an estimate of what your tax obligation is likely to be, and remember that it is critical to seek appropriate professional advice from a tax advisor.

Conveyancing Fees

Legal fees for conveyancing vary widely, but the good news is they tend to be lower for sellers than for buyers.

Legal fees can often be charged in blocks of time, with add-ons for things like printing or extra correspondence. Look for a conveyancer who offers fixed or flat fee arrangements so you know what the costs will be ahead of time.

At Keylaw, we charge a fixed fee of $495 for selling properties in Queensland, and $1090 for selling properties in the Northern Territory (including GST, outlays extra, excludes properties over $3 million).

Electronic Settlement Fee

PEXA – Australia’s electronic settlements platform – charges a fee of around $140 per transaction for both the buyer and the seller.

PEXA is now mandated in Queensland and is used for the majority of property transactions – for other locations, please ask your conveyancer about the mode of settlement and cost.

Mortgage Discharge Fee

If you have an existing loan on the property, it is important that you speak to your lender before you decide to sell. Breaking fixed term loans can incur early exit fees and other penalties.

If you have a mortgage on the property you are selling, this must be removed prior to settlement. The process involves submitting a mortgage discharge form with your lender. This should be done shortly after going under contract, as banks can take up to a few weeks to discharge your mortgage.

The cost of a mortgage discharge is ranges from $150 – $600. It is important to note that even if you have paid out your mortgage, your lender may still be listed on the title of your property as mortgagee, and this registration must be removed before settlement.

Selling and Buying at the Same Time?

If you are looking at selling your existing property and buying a new property, and you require funds from your sale to buy, you should make your purchase subject to the sale of your property.

If you are not planning on making your purchase subject to sale, and you require finance to complete your purchase, you may need to take into account the cost of a bridging loan. You should talk to your bank or mortgage broker.

More Questions?

If you are selling property, you need a conveyancer you can trust. Contact our friendly, expert team today to find out why Keylaw is Australia’s top-rated conveyancer. Our team will be happy to answer any questions you might have, a guide you to a smooth, easy settlement.

The above is not legal or financial advice, and is general information only.