Homeowners Face ‘Hidden Costs’ in Selling Home

For home sellers, low inventories and increasing home prices make this the best of times. But a report from Zillow and Thumbtack suggest hidden costs can present sellers with a different form of “sticker shock.”

Zillow, Seattle, and Thumbtack, San Francisco, reported from closing costs to basic home prep projects such as carpet cleaning and staging, homeowners can spend between $10,000 and $55,000 to sell a house, depending on location. Jeremy Wacksman, Zillow Group chief marketing officer, said considering that nearly two-thirds (63 percent) of today’s home sellers have never sold a home before, these costs could come as a surprise.

The report said more than eight out of 10 home sellers make improvements before listing. While some sellers prefer to complete these projects themselves, those who outsource can expect to spend more than $2,650 nationally to cover five of the most popular seller home prep projects–staging, carpet cleaning, interior painting, lawn care and house cleaning. Labor costs vary significantly by region, so sellers in Los Angeles pay an average of $4,000 for the same projects, compared to sellers in Columbus, Ohio, who pay $1,500.

The report said the two largest closing costs are agent commissions and in most states, sales or transfer taxes. Nationally, sellers spend $12,532 for both closing costs on the median home. Since they are percentages of the home’s sale price, sellers in hot coastal markets such as San Francisco pay $51,520 on the median home, the highest of the metros analyzed. Sellers in Indianapolis pay the least ($8,238) as home values are lower and the state has no transfer tax.