Realty transfer tax
You also might be responsible for what’s known as a realty transfer tax. These are fees assessed by local governments whenever a property changes ownership.
These taxes are sometimes called a “Deed Excise tax” or a “Documentary Stamp tax.” Who ultimately pays these taxes depends on the state, city, or county where the sale occurs.
In Massachusetts, for example, the seller is typically responsible for covering transfer taxes as part of the closing costs. However, the distribution of these fees can be negotiated during the sale process.
Real estate agent commission
Unless you’re selling your home for sale-by-owner, you’ll likely have used a local agent. Research indicates that an agent’s expertise can significantly impact your sale: In 2023, homes sold with an agent’s assistance had a median price of $405,000, compared to $310,000 for FSBO sellers.
Working with a real estate agent means paying a commission. This fee covers various services, such as accurately pricing your home, marketing it effectively, and negotiating with buyers to ensure you receive the best possible price and terms.
It should be noted, however, that on March 15, 2024, the National Association of Realtors (NAR) announced a landmark lawsuit settlement that will change the way real estate agent commissions are handled in the future. These changes will “decouple” seller and buyer agent compensation. Industry experts predict that this decoupling will likely lower agent fees and give buyers the ability to negotiate commission amounts directly. Learn more.
HomeLight’s transaction data reveals that the national average real estate agent commission is 5.8% of the property sales price. This commission typically includes fees for both the listing and buyer’s agents, with sellers customarily covering the cost.
Use HomeLight’s commission calculator by entering your city for commission data tailored to your specific area.
