“As a real estate agent offering my services in Hampton Park, Pakenham, Lyndhurst, and the nearby suburbs, I would like to apprise you of the costs that a vendor may have to go through while selling their homes.”
Selling a house in Australia is a pricey venture, pretty much for everyone. This is because number of hidden costs are involved in selling a property and these unfold slowly with each step coming as a surprise. A layman unaware of the real estate market may find himself lost in the process of selling a home. That is why there are real estate agents.
All those who think they don’t need a real estate agent have not known the role they can play in selling their home at a great price. Read this blog to know the reasons why you still need a real estate agent.
Now, let us get back to the costs involved. Apart from agent’s fees, conveyancing, maintenance, marketing expenses, there are myriad of other expenses that can add up quickly unknowingly.
Well, the cost of selling a house varies from state to state. I will take you through some of the standard costs that are involved of which many vendors are unaware.
While selling a home in Australia, you may have to choose between two types of agent’s fees – Commission or flat fee.
A flat fee is something you and your real estate agent agree upon before the property goes to market. The cost remains the same regardless of how much your house sells for. You may even have to pay to the agent even if your property does not sell. A commission on the other hand is the percentage of the final sale price that you give to a real estate agent. The commission percentage can range from 1% to 3% but these are influenced by number of other factors too like your house worth, competition for business among real estate agents. Neither of the methods discussed above are wrong or right. Go for the one that suits you the best. However, it is advisable to discuss all the fees involved with the real estate agent before signing.
Marketing plays one of the most essential roles in securing the best price to sell your home. If you aren’t able to showcase the best features of your house, there is no way you can sell it. But to do that you need to spend a little before marketing your house. For that you may have to consult professional home stylists and present your home in the best light possible. Other than this, typical expenses may include a board, or a sign in front of your house, listing the property on the best Australian sites, copywriting for property, creating a floor plan, photography for listings.
Capital Gains Tax
This is the tax you pay to the Australian Government when you are selling your investment property (the property that you do not live in). It does not apply to the principal property you live in. You are liable to pay the Capital Gains Tax if you make a profit from increases in the value of your valuable asset. The profit you earn from the time you buy it to the time you sell your investment property.
The amount of CGT you will need to pay depends on the profit you make by selling your property and the expenses incurred from owning the property. The CGT is calculated based on the sales price of the property minus expenses, which include; stamp duty, sales fees, legal fees, advertising, marketing fees, ownership cost, title cost, renovation cost. To know about all these costs in detail, reach out to the best real estate agent, for he would guide you throughout the process and keep you informed.
After the sale of your property, the next step is to transfer the legal ownership of your property from one owner to another. This can be done by licensed solicitor, and conveyancers.
“It is recommended to contact a local and a licensed solicitor, says Manny Singh”.
If you have a mortgage on the current home you are selling, you will have to pay your lender a discharge or an early exit fee. The charge may vary from customer to customer. You need to see that your lender has his/her own mortgage discharge form to fill.
Outstanding Council Rates
These are probably the most easily forgotten costs. As the owner of the property, it is your duty to stay updated with the council rates including the day of settlement. Any outstanding rates are paid from your sales proceed.
There are a lot of other formalities that go into while selling your house. If you are thinking of selling, then it is always good to have an experienced real estate agent by your side. You never know how much burden a top realtor can take away while donning several hats in a day. To know, read our blog What roles a real estate agent plays in a day.
Whether you are selling your home for the first time, or you are an experienced vendor, you may end up making some of the common mistakes while selling your home. Since the real estate market is evolving every day, it is important for you to avoid some of the mistakes while selling your home.