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If you’re thinking about selling your home, you probably have two numbers on your mind: What is my home worth, and how much money will I actually walk away with?
Those numbers aren’t necessarily the same.
There are several expenses that can come with selling a home in California. Some are fairly predictable, while others depend on the condition of your property, the terms of the offer, and what you negotiate with the buyer.
Understanding these expenses before putting your home on the market can help you avoid surprises and make better decisions throughout the sale.
1. Real Estate Agent Compensation
Real estate agent compensation is negotiable and depends on the agreement between the seller and their agent, as well as any other compensation negotiated as part of the transaction.
When interviewing an agent, don’t just ask what they charge. Ask what services are included.
Depending on the agent and their marketing plan, those services may include professional photography, video, social media marketing, online advertising, open houses, MLS exposure, showing coordination, pricing strategy, offer analysis, negotiation, and transaction management.
The goal isn’t simply to get your home on the market. It’s to properly position the property, attract qualified buyers, negotiate favorable terms, and successfully get the transaction through closing.
2. Escrow, Title and Other Closing Costs
Sellers can also have various expenses associated with transferring ownership of the property.
Depending on the transaction and local customs, these may include escrow fees, title-related expenses, transfer taxes, HOA-related fees, document fees, and prorated property taxes or assessments.
The exact amount will vary from one sale to another.
That’s why I prefer preparing an estimated seller net sheet before listing. Instead of guessing based on a percentage, we can look at the anticipated sale price and estimated expenses to give you a much clearer picture of your potential proceeds.
3. Preparing Your Home for the Market
This is one area where sellers often have quite a bit of control.
You may decide to spend money on things like:
- Interior or exterior paint
- Professional cleaning
- Landscaping
- Carpet or flooring
- Handyman repairs
- Window cleaning
- Decluttering and storage
- Staging
- Pre-listing inspections
The key is determining which improvements are worth doing and which aren’t.
You don’t necessarily need to remodel your kitchen or bathrooms before selling. Sometimes relatively inexpensive improvements—fresh paint, landscaping, cleaning, and decluttering—can make a significant difference in how buyers perceive the home.
Before spending thousands of dollars on renovations, it’s a good idea to talk with your real estate agent about what buyers are looking for in your particular neighborhood and price range.
4. Termite Inspection and Repairs
Here in California, termites and other wood-destroying organisms are something homeowners frequently encounter.
Depending on the property, a termite inspection may identify items such as drywood termites, subterranean termites, fungus, dry rot, or other wood damage.
The cost can vary significantly. A property might require relatively minor repairs or treatment, while another could require more extensive work.
It’s also important to understand that termite inspections and repairs aren’t automatically handled the same way in every transaction. Whether an inspection is performed, who pays for repairs, and which items are completed can depend on the contract and negotiations between the buyer and seller.
For some sellers, addressing termite issues before listing can help eliminate uncertainty. For others, it may make more sense to address them during negotiations.
5. Buyer-Requested Repairs and Credits
After accepting an offer, the buyer will typically conduct their inspections and due diligence according to the terms of the purchase agreement.
Depending on what they discover, the buyer may request that certain items be repaired or ask for a credit instead.
For example, an inspection might identify an aging water heater, plumbing issue, roof concern, electrical item, or other deferred maintenance.
That doesn’t automatically mean the seller has to agree to every request. Repairs and credits can become part of the negotiation between buyer and seller.
This is also why the highest-priced offer isn’t necessarily always the offer that produces the best financial outcome. Price, contingencies, credits, repairs, financing, and other terms can all affect your final proceeds.
6. Moving and Other Expenses
Don’t forget about the costs associated with actually moving out of the property.
Depending on your situation, you might need movers, packing supplies, temporary storage, junk removal, or even temporary housing.
Individually, these expenses may not seem significant compared with the value of the home, but they’re still worth including when planning your move.
The Number Sellers Should Really Pay Attention To
When I meet with homeowners, I don’t think the conversation should stop at:
“How much can we sell my house for?”
There’s another question that’s just as important:
“How much will I actually walk away with?”
That’s where an estimated seller net sheet becomes valuable.
We can start with an anticipated sales price and estimate the expenses associated with the transaction, along with any mortgage or other liens that need to be paid off.
Estimated Sales Price
– Selling Expenses
– Mortgage & Other Payoffs
= Estimated Net Proceeds
That gives you a much more useful number when you’re deciding whether to sell and planning what comes next.
Thinking About Selling Your Orange County Home?
If you’re considering selling a home in Huntington Beach or elsewhere in Orange County, I recommend looking at the numbers before putting the property on the market.
We can discuss your home’s estimated value, what—if anything—you should repair or improve before listing, your marketing and pricing strategy, and your estimated net proceeds.
That way, you’re not going into the sale wondering what everything is going to cost.
You’ll have a plan.
Thinking about selling? Contact me and I’d be happy to prepare a complimentary home value analysis and estimated seller net sheet so you can see what your numbers may look like before making a decision.
This article is for general informational purposes. Costs, contractual obligations, taxes, and transaction terms vary. Sellers should consult the appropriate real estate, tax, legal, or other professionals regarding their specific situation.
