Seven expenses to take into account when selling
One of the big questions most people have when they first consider selling, is how much will it cost?
Well, that depends on a few things including the way you opt to market your property, whether it’s an investment or not, and the cost of professional services such as your real estate agent and conveyancing.
So, let’s take a look at the expenses to take into account when selling…
Photography and marketing
In order to attract your ideal buyer, your property will need to be marketed. Pictures will need to be taken, brochures will need to be prepared, and for sale signs will need to be erected.
How much this will cost depends on the marketing strategy you and your agent decide on.
At its most basic, it might include professional photography and then listing the property on real estate portals such as Domain and realestate.com.au.
For higher-end properties, marketing might also extend to advertising in print publications.
When you discuss the strategy which suits your property best, your agent will give you a clear outline of the marketing costs involved.
Styling and repairs
As the old saying goes, you get one chance to make a great first impression, which is why it’s critical your property is shown in its best light.
That might mean repairs are required before taking it to market, or perhaps styling the property professionally might be worth considering.
Again, your agent can help with guidance on what needs to be done, but do set a little money aside in your budget for any required repairs or maintenance to ensure your home looks the best it can when it comes to market.
Agents’ fees
The agent’s fee is paid when the property sells and is basically a small percentage of the property sale price.
This fee can vary from one agency to another, but generally it ranges from 1.5 per cent to 3.5 per cent, and your agent will be upfront about what fee they charge.
When you consider this fee, it’s important to remember it’s not about opting for the agent with the lowest commission.
Instead, it’s about weighing the value and service they provide when it comes to selling your home.
Legal fees
Selling a home involves the legal element of transferring the property from one person to another, which is where conveyancers come in.
Your conveyancer will double check all the legal documents, ensure all conditions are met and then transfer ownership of the property to the buyer at settlement.
If you’re selling, it’s generally recommended you budget between $800 and $2000 for conveyancing costs.
Title searches
In addition to the more well-known fees of marketing, conveyancing and agent’s fees, there are also some smaller lesser-known costs.
These include things like title searches to ensure the property is actually in your name, pest and building inspections if you would like to furnish a potential buyer with this information, and also bank fees associated with your loan.
For example, if you have a mortgage on the property you are selling, you may need to pay your lender a discharge or early exit fee.
Capital gains tax
While the property you reside in is not likely to command capital gains tax, an investment property might.
As the Australian Taxation Office explains, capital gains tax (CGT) is the tax you pay on profits from selling assets, such as property.
In other words, if you’ve had an investment property for a year and it goes up in value, you pay tax on the amount it goes up by.
To determine whether you will be required to pay capital gains tax in the financial year you sell a property, speak to your accountant.
Moving
Once the property sells, you will also need to factor in the cost of moving, which will vary depending on how you approach it and what exactly is involved.
Looking to buy or sell?
If you’re considering buying or selling a property, why not chat with one of our friendly Eview agents on 1300 438 439?
You can also view our list of currently available properties here.
