How much does it cost to sell your house?

Selling a house can be expensive. When all is said and done, the cost can total as much as 6% to 10% of the sale price. On a $400,000 sale, this would come to $24,000 to $40,000.

Sellers who have equity typically pay most of the costs out of their proceeds from the transaction, rather than upfront in cash. Sellers who don't have enough equity could have to bring cash on closing day.

Realtors’ commissions may be changing

The biggest cost for most home sellers is the Realtor's commission. Rather than a flat fee, sellers typically pay their real estate agent 5% to 6% of the home's sale price. For a $400,000 house, a 5% commission would be $20,000. At 6%, the commission for the same house would be $24,000.

Your Realtor typically doesn't keep the full amount. Instead, the commission is shared with the buyer's Realtor as an inducement for that agent to show the house to prospective purchasers. Buyers typically don't pay anything directly to their Realtor when they purchase a home.

This commission structure may be changing due to the recent National Association of Realtors settlement. Though the outcome hasn't yet been finalized, it’s possible sellers will pay a lower commission to their Realtor while buyers pay a separate commission to theirs. Even though the settlement hasn’t been approved by a judge yet, some people are already starting to adjust. You might have negotiating power over your agent’s commissions now.

Dig deeper: Is it a good time to sell a house?

Other costs of selling a house

As a homeowner, you may also face a long list of other costs to sell your house, including the following:

• Staging. Home staging showcases a home with furniture, artwork, and accessories to try to make the home look more appealing to buyers and entice them to imagine themselves living in the home. Stagers say their services help create excitement and bring in more or better offers from buyers. Professional staging can cost hundreds or thousands of dollars, depending on the home's size and the services the stager provides.

• Repairs and upgrades. In a seller's market, you may not need to make repairs or improvements to sell your home for a fair market price. In a buyer's market, buyers have more bargaining power and often much higher expectations for a home. In this case, you might have to spend more to make repairs and improvements to satisfy a buyer’s demands.

• Title insurance. Title insurance protects homeowners and mortgage lenders from financial losses if the chain of ownership of a property is challenged. As the seller, it’s possible you’ll be in charge of paying for the buyer’s title insurance premium, which usually costs a few hundred dollars, at closing.

• Settlement services. In some states, buyers and sellers use escrow or closing companies to handle their real estate transactions. In other states, attorneys perform these services. Either way, there will be fees — 1% to 2% of the sales price is typical. The seller or buyer may be responsible for this cost, or you could agree in the negotiation process to split it.

• Transfer tax. A real estate transfer tax is a state or local tax collected by a government agency when the ownership of a property is legally transferred from the seller to the buyer. Depending on where you live, either the buyer or seller could be in charge of this cost. Some states and cities also impose a mansion tax for homes selling above a certain price.

Sellers typically pay for staging and home repairs. Title insurance, settlement services, and transfer tax may be paid by the seller or the buyer or shared between them. What's customary varies from place to place and should be negotiated as part of the purchase contract.

Costs sellers typically don't cover include home inspection fees and expenses related to the buyer's mortgage, such as loan origination fees and appraisal fees.

Does it cost less to list your house as FSBO?

Homeowners who sell their house without a Realtor may be able to save money by eliminating the Realtor's commission from the transaction, but these for-sale-by-owner (FSBO) sellers also face some significant disadvantages by taking this route.

If you list your property as FSBO, you are responsible for marketing and showing your home, as well as handling some of the legal requirements of the sale. These tasks can prove time-consuming, and mistakes can result in unanticipated costs or legal risks. You could also have to offer to pay the buyer's Realtor commission to incentivize agents to show the home rather than steer buyers away from it.

The bottom line is that it's not easy for sellers to anticipate how much it will cost to sell a house, especially as the future of Realtor commissions is up in the air. The costs vary, sometimes widely, depending on the sales price, whether the house is listed with a Realtor, and how much bargaining power you have in negotiating with the buyer. If you are a repeat client or intend to buy your next home with the same Realtor who is selling your current home, your agent may be willing to give you a commission discount. Smart sellers pay attention to the costs as well as the price so they can maximize proceeds from the sale.

This article was edited by Laura Grace Tarpley