Buying or selling property is not like shopping at the grocery store where the price on the item is what you pay. Real estate transactions involve all sorts of interesting, and potentially costly, add-ons that you should be aware of before entering into negotiations.
On the selling side, there is the agent’s commission. This usually runs between two and three percent of the selling price going to the listing agent and two and a half to three percent going to the buyer’s agent. On a piece of property selling in Oregon for $400,000 that adds up to a total of $24,000. And that’s only the beginning.
The seller pays half of the escrow fee and depending upon which company holds the money it can cost $400-$1200. The title insurance varies also but can run $400-$2000. Then there’s the recording and reconveyance fees at $200-$800. If a well is the property’s source of water, the well purity tests for coliform, arsenic and nitrates will be around $200.
Some negotiable costs that can be split with the buyer might be a well flow test for $250-$400, a septic tank pumping and inspection for $300-$500 and any repairs that seem reasonable between seller and buyer. All told, these costs could add up to over $17,000.
On the buying side, there are loan fees charged by the lending institution and vary depending upon the type of loan, the amount of money borrowed and who is loaning it. A home inspection could cost $350-$500 but is always in the best interests of the buyer to have done. Total closing costs on a $400,000 property could run as high as $10,000. This can often be rolled into the loan, but a knowledgeable real estate agent can get more specific as you reach the point of buying or selling.
Work with me to more closely estimate your transaction costs and you will be best prepared when you sit down to sign those closing papers on you property. I am always happy to discuss your real estate situation.