What costs should I plan for in buying or selling a home?

Buying or selling a home can be a daunting process, especially when it comes to understanding all of the costs involved. As a Compass team member, I want to make sure that you have a clear understanding of the expenses you should plan for when buying or selling a home.

For Buyers:

1. Down payment: This is the amount of money you pay upfront to secure your mortgage. It is typically 5%-20% of the purchase price of the home.
2. Home inspection: A home inspection is an essential step in the home buying process, and it can cost anywhere from $400-$600 depending on the size and location of the home.
3. Appraisal fee: An appraisal fee is paid to a professional appraiser to determine the market value of the home. It typically costs between $300-$500.
4. Closing costs: These fees are associated with the transfer of ownership of the property and typically include legal fees, title insurance, and other expenses. They can range from 1%-3% of the purchase price of the home.
5. Moving costs: Don't forget to factor in the cost of hiring a moving company or renting a moving truck.

For Sellers:

1. Realtor commission: Typically, the seller pays the commission for both their own and the buyer's real estate agent, which is usually around 3-4% of the sale price of the home.
2. Home repairs and staging: Before putting your home on the market, you may need to make some repairs or stage the home to make it more appealing to potential buyers. These costs can vary widely depending on the condition of the home.
3. Closing costs: Just like with buyers, sellers are also responsible for covering closing costs, which can range from 1%-3% of the sale price of the home.
4. Capital gains tax: If you sell your home for more than you paid for it, you may be subject to capital gains tax. This tax can be significant, so make sure you understand how it will impact your bottom line.

In addition to these costs, it's important to budget for any unexpected expenses that may arise during the buying or selling process. By working with a knowledgeable Compass Team agent, you can ensure that you have a clear understanding of all the costs associated with your real estate transaction.

Buying or selling a home can be a significant investment, but with careful planning and preparation, you can navigate the process with confidence. If you have any questions about the costs involved in buying or selling a home, don't hesitate to reach out to a Compass Team agent. We're here to help you every step of the way.