Average Cost of Selling a House in California (Hidden Fees Included)
The cost of selling a house in California through a realtor is high, but there are other options for selling your home that can save you money on fees and commissions – and can also save you time.
The bulk of the costs involved with selling a home are covered by the seller, which makes considering all your options an excellent plan. Selling to a real estate investor who pays cash for houses in Southern California is generally the most streamlined approach, and it translates to a quick sale that skips the closing costs and eliminates the need for home repairs.
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How much does it cost to sell a house in California?
The first cost to sell a home in Southern California is the commission fee, which is generally the single most costly expense. There are also closing costs, such as title insurance, state transfer taxes, recording fees, home inspection costs, prorated property tax, and potential attorney fess – many of which you’ll be required to cover.
When it comes to selling your home, there are options other than hiring a realtor, and exploring which one works best for you can save you money and increase your profits in the long run.
Cost of selling a house in California broken down
When you set out to sell your home, you’re likely thinking about your home’s value and are anticipating turning a profit. Selling your California home, however, also involves a considerable number of costs that can take a significant bite out of your bottom line.
Can I sell my house fast in California? Yes, you can, but the costs associated can lead to lower profits. For example, you’ll likely have fewer opportunities for negotiation. Additionally, many of the outfits that buy houses as is, which tend to have names like We Buy Houses for Cash, are in the business of scooping up properties for as little as they can get away with. If your goal is to sell your home quickly, consulting with a reputable real estate investor may be in your best interest.
Before you close on a home sale, it’s a good idea to understand the expenses that are generally involved when you sell through a traditional real estate agent. Basing these costs on the average California home value of $741,789, which is down 3.4 percent from 2022 according to Zillow, is the simplest method.
The commission fee
A primary cost for selling a house in California is the agent’s commission fee, which is generally the single largest cost associated with selling a home. While these realtor fees can vary, the average rate hovers around 5 percent, which amounts to about $37,089 that you’ll lose right off the top.
The good news is that there are other means of selling your home that can decrease or even eliminate this expense. Examples include using a discount real estate broker, negotiating a reduced listing commission, selling without a realtor, and selling a house as is in California to a real estate investor. Free services in California and throughout the nation can help sellers negotiate reduced listing commissions of 1.5 percent, which can save a considerable amount on listing fees.
In the State of California, the real estate agent’s commission is split between the agents of both the buyer and the seller – a portion of which goes to each agent’s broker. This is the only payment throughout the process of selling a California home that the involved real estate agents receive.
Closing Costs
Closing costs generally include title insurance, transfer taxes, recording fees, and beyond, and the party who needs to pay depends upon the situation. In other words, all those seemingly hidden fees have a name.
Title Insurance
The cost of title insurance generally tacks on another cost of about .19 percent, which – based on the average California home – is an additional $1,409, including title search. Title insurance protects any claims made against the home you’re selling and protects you in relation to any mistakes on your deed. It can also cover any legal expenses in the event there is a claim.
The important point to be made here is that the transfer of property deed without title insurance is a risky business. By insuring the transfer of ownership, you establish that the sale is above board.
The matter of who pays for title insurance depends on which California county the house is located in. For example, counties like San Francisco require the buyer to cover title insurance, but other counties take a different approach. While many counties split this cost between the buyer and seller, others require the seller to pay.
State transfer taxes
State transfer taxes refer to the taxes levied by the state government when you transfer the title of your home from your name to the name of the buyer at closing. In California, this tax runs at about .11 percent of the home’s final sale price, which translates to another $816 in closing costs.
Recording fees
Recording fees cover the county charges for registering a property’s transfer of ownership. While this fee can vary quite a bit, you can expect to pay about $244 currently.
Home inspection cost
Typically, the buyer pays for the home inspection, and while this expense is part of the closing costs, it’s paid for at the time of the inspection. The seller can also be responsible for paying this fee if they have an inspection performed prior to putting their home on the market or before closing the sale. The price of a home inspection for a property of average home value in California tends to run between $250 and $350.
Prorated property tax
California real estate law requires home sellers to pay property tax on the home they’re selling for the number of days they owned the property in the year the sale is finalized. These taxes are prorated and are generally split between both the buyer and the seller.
Attorney fees
In California, you’re not required to employ a real estate attorney to handle the closing on your home, but there are situations in which doing so is advised. When it comes to the total average cost to sell a house in California, it’s important to know that attorney fees can vary considerably from firm to firm and can add up quickly.
How much are closing costs in California? When it comes to your total closing costs as a California seller, you’ll need to account for your home’s selling price and the expenses that you’re required to pay. This includes the realtor commission, which you can expect to be about $37,089 on the median home value in California. You’ll also face the following expenses:
- About $1,409 in title insurance
- About $816 in transfer taxes
- about $244 in recording fees
- About $300 in inspection costs
This is not to mention any attorney fees you incur and the prorated property tax you’ll be on the hook for. All told, the various fees and expenses add up to about $39,858 that will come right off the top of your profits, and this is before you factor in preparing your home for market.
Even with listing fees of just 1.5 percent, you’ll be shelling out a good deal of money when you sell your home via the traditional method of listing with a real estate agent. While selling without a realtor is a possibility, it’s important to recognize that learning how to sell a house by owner in California is challenging and that it isn’t uncommon to lose more on the price you secure than you would have paid in relator-related total selling costs if you get it wrong.
Preparing your home for sale
Home selling costs in California can be exceptionally high, and one of the most expensive components tends to be getting your home ready for sale in the first place. If your property is in need of serious home repairs, the price can be immense, and it can take a considerable amount of time.
Making repairs
If your home needs a significant amount of work, it can be difficult to know what to fix before selling a house in California. Selling a home as is on the real estate market is challenging, and you can expect the process to take longer and for your property to sell for significantly less than it would if it was well maintained.
This said, the expense and the amount of time associated with making the needed repairs can eat into your profits. In other words, it’s important to strike a balance between the amount you pour into your home and the return you’re likely to see on your investment – in relation to the amount of time it will take to sell, which can add to the total costs.
A better option may be to consider a cash offer. What is a cash offer on a house? Some buyers, such as real estate investors, specialize in speedy cash sales that involve buying properties as they are, which can be especially helpful if you’re ready to sell your California house as is.
Freshening your property
Before you put your home in California on the market, you’ll want to spiff it up. Depending upon the state of your home, this can mean a lot of different things. The typical homeowner with a house that is in decent shape can expect to spend some cash on updates like the following:
- A paint refresh in a modern, neutral palette that emphasizes your home’s potential
- A freshly painted door in a bold, welcoming color
- A freshly scrubbed interior that speaks to the care you’ve lavished on your home over the years
- A streamlined interior that’s been pared down to highlight the abundance of space and other primary selling points
- A tidy exterior with an inviting yard
At this point, you’re attempting to give potential buyers what they want, which is all about reflecting their wishes rather than your own design choices.
The cost of this refresh will depend on the condition of your home and the amount of money you’re prepared to put into the project. Depending on how much stuff you have and your ability to store it out of sight during viewings and open houses, renting storage space may also be in order.
Staging your home
How much does it cost to stage a house? That will depend on a variety of different factors. For example, you may choose to consult with a professional stager but not to employ their staging services. Regardless of the level of staging you seek, you can expect the price to come off your bottom line.
While some California real estate agents cover the cost of a home staging consult, they generally incorporate the expense in higher commissions. The services that home stagers offer begin with expert advice on how to show your home in the most advantageous light and extend to all the following:
- Physically staging your home in its entirety or only staging key areas
- Supplying you with furniture rentals that help transform your space
- Accessorizing your home to help achieve the maximum bang for your staging buck
The cost of staging your home will depend on your resources and goals in addition to factors like the following:
- The size of your home
- The value of your home
- The amount of time your home remains on the market, which will affect the price of keeping it staged
- The style you are going for – generally, a homey aesthetic is less costly than a modern, sophisticated look would be
While there are no guarantees when it comes to selling a home, professional staging is closely associated with faster sales and with making more money upon sale.
California home buyers are looking for houses that capture their imaginations – allowing them to envision the properties becoming their dream homes, and this is difficult to do if your house is crammed with your family’s possessions. As a homeowner who is preparing to sell your house, there are decisions to be made in relation to staging, and better understanding the basics can help. Homes that sell quickly and for top dollar tend to be staged.
Begin with a blank canvas
The idea is to sell potential buyers an idealized version of the home you’re living in – an idealized version that is open to possibility.
This generally begins with clearing your home of everything that doesn’t need to be in it and keeping only those pieces that enhance the space. If your current furniture fits the bill, your stager may work with what you have – or with some of what you have, which can reduce the expense associated with renting furniture for staging.
Enhance from there
Stagers understand what buyers are looking for, and they have the savvy to help sellers like you stage their homes accordingly. A skilled stager can work within your budget to help you move your property quickly and for a good price. You should know, however, that many stagers have a minimum starting price that is not negotiable.
Whether you plan on staging your entire home or just a key area or two and whether you will be using your own furniture or your stager’s offerings, home sellers in California can expect to improve their home’s market value with professional staging. Your stager will help emphasize your home’s potential and help viewers imagine themselves living there, which is a critical component of selling a house.
Total average cost to sell a house in California
In addition to the closing costs, which average about $39,858 including realtor fees – as mentioned above – there is the expense of prepping your home for market, and the actual costs can be quite high. When it comes to the matter of what selling a home costs, it’s important to focus on striking a balance between the amount you spend and your return on that investment.
While some buyers may not be as invested in seeing a home that’s perfectly staged, many are, which makes doing at least some staging a good idea. Ultimately, how much it costs to sell a house will depend upon your priorities, budget, and time frame.
How much does it cost to sell a house in California if I work with you?
At SoCal Home Buyers, we recognize that not every California home seller has the time, resources, and desire to navigate the traditional real estate sales process, and we’re proud to count ourselves among the best companies that buy houses for cash.
Wondering how to sell your house to an investor in Southern California? We’ve got you covered with the four following simplified steps:
- Give us a call at 951-331-3844—or fill out the short form below—to request your fair cash offer.
- Await our prompt response to discuss your property in greater detail and schedule a one-time inspection that allows us to offer the highest amount possible.
- At the time of the inspection, our in-house inspector will quote you a fair cash offer, and if you’re on board, you can consider your home sold!
- Choose your closing date, and leave the rest to us. You can choose payment via check or wire transfer. It simply doesn’t get any easier.
Our key takeaways on the costs and fees to sell a house in California
The fees of selling a house in California can add up fast and can leave you with far less profit than you’d perhaps counted on. if you’re concerned about the fees for selling your home and want a better real estate approach, the good news is that you can speed up the process while bypassing closing costs and commissions.
How? By selling to real estate investors in Southern California – like us at SoCal Home Buyers. The cost to sell a home in California is high, which can make selling your property quickly for cash very inviting.
