SEATTLE and SAN FRANCISCO, April 9,
2019 /PRNewswire/ -- Home sellers in the United States spend $20,851 on average to sell their homes, according
to Zillow® and Thumbtack's 2019 Hidden Costs of Selling analysis.
This includes closing costs, but also the improvements and other
projects made when people are preparing their homes for sale.
More than half of today's sellers are doing so for the first
timei, and the costs associated with the process may
come as an unwelcome surprise. Zillow and Thumbtack identified
several common – but often overlooked – expenses to inform sellers
as they prepare to list their homes this spring.
The majority (79 percent) of sellers complete at least one home
improvement project before putting the home on the market, which
tends to pay off. Sellers who make improvements to their homes are
more likely to sell for more than their asking price than those who
don't – 22 percent versus 16 percent, according to the Zillow
Group Consumer Housing Trends Report.
Sellers who hire professional help for common home prep projects
tend to spend, based on a national average, $6,570 on improvements like interior and exterior
painting, staging, and carpet cleaning, as well as local moving
costs to their new home. But with the cost of labor varying by
market, sellers in different areas could see significantly
different costs. Sellers in Sacramento can spend about $7,800 preparing their home for sale, compared
with Phoenix sellers, who could
spend about $4,000 for the same
projects.
Closing costs are another big expense for home sellers,
including agent commissions and transfer or sales taxes.
Nationally, these can add up to $14,281, on average, but because they are based
on the home's sale price, sellers in the nation's priciest markets
pay much more. In the San Jose
metro, sellers pay $76,015 on average
in closing costs, the highest of metros analyzed. By comparison,
sellers in Cleveland spend the
least - $9,046.
Preparing a home for sale is just one of the things that can be
stressful for sellers. The two biggest challenges for sellers were
timing the sale with the purchase of a new home, and selling it
within the desired time frameii. And with some of
the hottest markets cooling off, buyers are able to be more
selective as they look for a new home, meaning sellers may have to
do more to get their homes sale ready. For homeowners preparing
their home for sale, Thumbtack is the website and app that helps
them find local, skilled pros to complete any project. For people
looking for an alternative selling option to avoid the stresses of
selling, Zillow Offers lets homeowners skip the prep process and
choose their own closing date.
"Selling is often a complicated process that can sometimes
require extensive prep work in order to put your best foot forward
for a successful sale," said Skylar
Olsen, Zillow's director of economic research. "It also
comes with huge transaction costs that aren't necessarily top of
mind to someone who hasn't sold a home in a while or never has had
the pleasure. Selling was hard even in the sellers' market of
recent years, and it's going to get harder as markets soften."
"While the costs of these touch-up projects can add up,
particularly in high cost of living metros, sellers should remember
that by taking care of these projects, they can get a really strong
return on their investment and may be more likely to sell their
home for the highest possible price," said Lucas Puente, Thumbtack economist. "As a first
step, homeowners considering selling their home in the next 12
months should start doing research and budgeting appropriately to
give themselves ample prep time."
Metro
|
Median
Home Value,
February
2019
|
Estimated
Closing Costs
(commissions
and state
transfer tax)
|
Basic Home
Prep
Costs (carpet
cleaning,
interior/exterior
painting, home
cleaning, lawn care,
staging and local
moving)
|
Total Hidden
Costs of
Selling
|
United
States
|
$225,600
|
$14,281
|
$6,570
|
$20,851
|
New York,
NY
|
$438,900
|
$28,090
|
$5,420
|
$33,510
|
Los Angeles-Long
Beach-Anaheim, CA
|
$652,700
|
$39,880
|
$6,180
|
$46,060
|
Chicago,
IL
|
$224,800
|
$13,825
|
$4,800
|
$18,625
|
Dallas-Fort Worth,
TX
|
$243,000
|
$14,580
|
$4,770
|
$19,350
|
Philadelphia,
PA
|
$232,800
|
$16,296
|
$5,200
|
$21,496
|
Houston,
TX
|
$205,700
|
$12,342
|
$5,135
|
$17,477
|
Washington,
DC
|
$405,900
|
$30,240
|
$4,400
|
$34,640
|
Miami-Fort
Lauderdale, FL
|
$283,900
|
$19,021
|
$5,220
|
$24,241
|
Atlanta,
GA
|
$217,800
|
$13,286
|
$4,770
|
$18,056
|
Boston, MA
|
$466,000
|
$30,085
|
$5,495
|
$35,580
|
San Francisco,
CA
|
$958,000
|
$58,534
|
$7,620
|
$66,154
|
Detroit,
MI
|
$160,400
|
$11,003
|
$5,295
|
$16,298
|
Riverside,
CA
|
$367,100
|
$22,430
|
$6,245
|
$28,675
|
Phoenix,
AZ
|
$265,400
|
$15,924
|
$4,040
|
$19,964
|
Seattle,
WA
|
$491,500
|
$38,239
|
$7,570
|
$45,809
|
Minneapolis-St Paul,
MN
|
$268,400
|
$16,990
|
$5,020
|
$22,010
|
San Diego,
CA
|
$591,800
|
$36,159
|
$6,270
|
$42,429
|
St. Louis,
MO
|
$166,900
|
$10,014
|
$3,690
|
$13,704
|
Tampa, FL
|
$213,300
|
$14,291
|
$5,220
|
$19,511
|
Baltimore,
MD
|
$267,900
|
$17,414
|
$4,350
|
$21,764
|
Denver, CO
|
$406,700
|
$24,443
|
$5,630
|
$30,073
|
Pittsburgh,
PA
|
$144,200
|
$10,094
|
$4,715
|
$14,809
|
Portland,
OR
|
$397,000
|
$23,820
|
$7,520
|
$31,340
|
Charlotte,
NC
|
$206,500
|
$12,803
|
$4,275
|
$17,078
|
Sacramento,
CA
|
$409,000
|
$24,990
|
$7,840
|
$32,830
|
San Antonio,
TX
|
$193,000
|
$11,580
|
$5,075
|
$16,655
|
Orlando,
FL
|
$237,200
|
$15,892
|
$5,205
|
$21,097
|
Cincinnati,
OH
|
$168,800
|
$10,466
|
$4,955
|
$15,421
|
Cleveland,
OH
|
$145,900
|
$9,046
|
$5,195
|
$14,241
|
Kansas City,
MO
|
$191,800
|
$11,508
|
$6,430
|
$17,938
|
Las Vegas,
NV
|
$279,000
|
$18,163
|
$5,715
|
$23,878
|
Indianapolis,
IN
|
$164,300
|
$9,858
|
$4,965
|
$14,823
|
Columbus,
OH
|
$189,800
|
$11,768
|
$5,045
|
$16,813
|
San Jose,
CA
|
$1,244,100
|
$76,015
|
$7,755
|
$83,770
|
Austin, TX
|
$308,700
|
$18,522
|
$4,965
|
$23,487
|
Zillow and Thumbtack's 2019 Hidden Costs of Selling report
factored in closing costs (transfer taxes and agent commissions)
and several basic home prep costs. Zillow computed transfer taxes
by using the tax rate for the primary state within each metro area
(in cases where metro areas cross one or more state lines), which
were then applied to the median home value for that area. Zillow
also assumed 6 percent for real estate agent commissions and
applied it to the median home value for each metro area. For home
prep costs, Thumbtack looked at tens of thousands of quotes from
small business professionals around the country and determined the
average cost for each expense within the selected metros. For the
purposes of this analysis, carpet cleaning, interior and exterior
painting, full-service lawn care, home staging, house
cleaning and local moving costs were identified as seven
of the most popular seller prep projects completed by Thumbtack
during the selling a home sale process.
About Zillow
Zillow is the leading real estate and
rental marketplace dedicated to empowering consumers with data,
inspiration and knowledge around the place they call home, and
connecting them with great real estate professionals. In addition,
Zillow operates an industry-leading economics and analytics bureau
led by Zillow Group's Chief Economist Dr. Svenja Gudell. Dr. Gudell and her team of
economists, data analysts, applied scientists and engineers produce
extensive housing data and research covering more than 450 markets
at Zillow Real Estate Research. Zillow also sponsors the quarterly
Zillow Home Price Expectations Survey, which asks more than 100
leading economists, real estate experts and investment and market
strategists to predict the path of the Zillow Home Value Index over
the next five years. Launched in 2006, Zillow is owned and operated
by Zillow Group, Inc. (NASDAQ:Z and ZG), and headquartered in
Seattle.
Zillow is a registered trademark of Zillow, Inc.
About Thumbtack
Thumbtack, headquartered in
San Francisco, was created to
solve a seemingly simple problem: local professionals need
customers so they can run and grow their business. Customers need
local pros too, but have trouble finding the right ones. So in
2008, the Thumbtack founders developed a marketplace bringing the
two together. Since then, Thumbtack has helped hundreds of
thousands of skilled professionals build successful businesses and
millions of customers each year with everything from plumbing, to
catering, to personal training to math tutoring. Learn more at
www.thumbtack.com.
i https://www.zillow.com/report/2018/sellers/the-typical-american-home-seller/
ii
https://www.zillow.com/report/2018/sellers/challenges/
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content:http://www.prnewswire.com/news-releases/sellers-spend-nearly-21-000-to-sell-a-home-in-2019--300827684.html
SOURCE Zillow