How much does it cost to sell a house in Houston?

June 20, 2019 — Written by Tara Mastroeni

how much does it cost to sell a house in houston

If you’re thinking of selling your home in Houston, you need to be aware that this process does come at a cost. Traditionally, the fees associated with selling can add up to 10% of the overall sale price. With the median sale price of a single-family home in Houston currently at $245,000, according to a press release by the Houston MLS, selling fees could range between $17,150 and $24,500.

In an effort to give you a better idea of where all your money is going, we’ve broken down some of the most common selling costs below. Use this post to get a rough sense for how much you can expect to spend during the process of selling your home.

Preparing your home to sell

Before you can officially put your home on the market, you’ll want to make sure that it looks its best in order to capture the attention of buyers. There are four main avenues that you can take to get your home looking market-ready. They are as follows:

Staging costs (<0.5% of sale price or $1,051)

For those who are unaware, staging involves arranging your home’s furniture and decor so that it looks as aesthetically pleasing as possible for potential buyers. According to HomeAdvisor, staging your home costs an average of $1,051 in Texas.

While the figure above may seem like a lot of money, keep in mind a survey by the National Association of Realtors (NAR) found that half of all seller’s agents reported an increase in the value offered by buyers once a home was properly staged. The reported increases ranged between 1% and 10%, or for the case of the median Houston home sale price, $2,450 and $24,500. In this sense, home staging could end up paying for itself if you’re able to get a higher price point.

→ Selling in Houston and want to skip the hassle of getting your home ready to list? Request a free, no obligation offer from Opendoor.

Landscaping (~1% of sale price or $3,083)

Just like it’s important to use staging to make sure that the interior of your home looks its best, proper landscaping can ensure the outside of your home catches potential buyers’ eyes. If your lawn is already in decent shape, you can probably get away with pumping up your curb appeal for just the cost of a few fresh flowers.

However, if your lawn requires a more serious makeover, you may want to consider a professional landscaping service. They can provide services like mulching, planting, pruning, and weeding. According to HomeAdvisor, the cost of these professional services in Houston averages out to be $3,083.

Home repairs & maintenance (varies)

As you get ready to put your home on the market, you’ll want to take care of the items on your home maintenance to-do list once and for all. By fixing as many issues as possible before you find a buyer, you not only present your home in good condition, but you also save yourself the hassle of having to negotiate the repairs with a buyer.

Jason Cline, Opendoor’s General Manager in Houston, recommends checking on the condition of your roof and HVAC. “In Houston, it’s especially important to get your roof and HVAC tuned up, serviced and in solid working order.”

→ If you want more flexibility in how you handle repairs, check out what it’s like to sell to Opendoor with our simplified repair process.

Home improvements (varies)

In addition to making repairs, you’ll need to decide if you’re interested in making any major improvements to the property. When done right, these improvements can add value to your home. However, keep in mind that you don’t necessarily have to undergo large-scale renovations like kitchen or bathroom remodels in order to get the benefit. Smaller projects like painting kitchen cabinets or replacing bathroom vanities can make an impact for a fraction of the cost.

Woman putting a nail in a wall to improve her home

Negotiating the sale

Once you’ve gotten your home into tip-top shape, the next step is to put your home on the market and wait for an offer. After you have an offer in hand, it’s time to start negotiations. That’s where the next round of costs comes into play.

Real estate agent commissions (~5%-6% of the sale price or $12,250-14,700)

If you decide to hire a real estate agent, commission fees may account for the bulk of your costs as the seller. Your agent and the buyer’s agent will split this fee in exchange for doing all the legwork that comes along with the transaction, including arranging tours, taking care of the paperwork and marketing your listing.

Bankrate estimates that commission fees usually range between 5%-6% of the home’s sale price. For the average $245,000 home in Houston, that ends up being between $12,250-14,700.

At Opendoor, our service charge is in line with the average costs you’d incur if you sold your house traditionally. Read more about our pricing structure and how we strive to stay competitive with standard sales.

Seller concessions (1.5%-2% of the sale price or $3,675-$4,900)

As the seller, a concession means that you’ve agreed to cover certain costs for the buyer. This is most commonly used when the buyer doesn’t have enough cash-in-hand to cover both their down payment and closing costs. Our research has found that seller concessions usually amount to 1.5% to 2% of the sale price.

However, keep in mind that, while this is an upfront cost for you, you can make up for it by negotiating a slightly higher sale price to cover that amount. When selling to Opendoor, you don’t have to worry about these types of seller concessions because we don’t request them.

Finalizing the deal

Once you’re ready to head to the settlement table, there are still a few more costs to consider. They are:

Closing costs (~1% of the sale price or $2,405)

In addition to the commission, the seller typically pays closing costs related to the transfer of the property. According to Realtor.com, these fees typically amount to an additional 1%-3% of the purchase price. In Texas, these closing costs are closer to 1% and generally includes title insurance, escrow and notary costs.

Transfer tax (N/A)

Some states charge a fee to transfer the deed to a property from one person to another. Luckily, Texas does not have a real estate transfer tax, so you don’t have to worry about paying a thing.

Mortgage payoff (varies)

Just as the name suggests, the mortgage payoff refers to how much of the proceeds from the sale will need to be used to pay off your old loan. If the proceeds from the sale don’t cover the cost, either due to interest or a prepayment penalty, you may need to be prepared to pay the difference from your own funds.

Buyer’s home warranty ( ~0.5% of the purchase price or $823)

Some sellers offer to give their buyers a home warranty as a gift at closing, but it’s not a requirement. This warranty covers any functional problems or damage that might happen to the home’s appliances or major systems. According to HomeAdvisor, the average home warranty in Houston costs $823.

Relocating

Even after you sell your home, there are still relocation costs to consider. We’ve broken them down for you below.

Moving costs (<0.5% of the sale price or $763)

The biggest cost when you’re relocating is the cost of the move. Although HomeAdvisor says that the process only costs $763, on average, within Houston, a lot will depend on how much you intend to bring with you and how far you’re moving. At the high end, Home Advisor says that moving in Houston can cost you $8,700. Make sure to get estimates from multiple companies before you decide on anyone in particular.
Couple packing up their house to move

Home transition and overlap costs (~1% of the purchase price or $2,450)

There’s usually a transition period between selling your home and moving into your new one. While the exact costs will depend on the timing of your settlements, you could potentially be stuck paying for the care and keeping of two properties at once, including mortgages, HOA fees, and utility costs. Alternatively, you could have to pay for temporary housing while you wait to close on your new one.

Our analysis of internal and industry data suggests that together, transition costs typically add up to about 1% of the sale price. However, one of the advantages of trading in your home with Opendoor is that we help you avoid these costs by helping you line up your moving timeline. You get to coordinate your closing dates so you don’t have to move twice or worry about paying two mortgages.

Table: Breaking down the costs of selling a home in Houston

In the table below we’ve broken down the costs of selling a home, assuming a sale price of $245,000, or the median sale in April 2019 for a single-family home in Houston. You can see that when you take all the expenses into account, the total cost of selling can reach over 13%. While the exact costs will vary, this will give you an idea of what to expect and what to plan for.

→ Use our home sale calculator to calculate your own personal scenario.

Home sales price $245,000
Cost item Cost amount % of sales price
Home preparation
Staging costs $1,051 0.4%
Home repairs & renovations * $7,400 ~3%
Negotiating the sale
Real estate agent commissions ** $13,475 ~5-6%
Seller concessions $3,675 1.5%
Finalizing the deal
Closing costs *** $2,405 ~1%
Relocation
Transition and overlap costs $2,450 1%
Moving costs $763   0.3%
Total costs $31,279 ~13%
Estimated proceeds $213,781

*For repair costs, we assumed the following projects and took the Houston average: painting a home interior, professionally cleaning carpets, cleaning the house, landscaping and 2 more repairs at $1,000 each.
** Bankrate estimates that commissions typically range from 5-6%. For this calculation, we have used the mid point of 5.5%.
***Includes estimated cost of title, escrow, and notary. There is no transfer tax for Texas.

This article is meant for informational purposes only and is not intended to be construed as financial, tax, legal, real estate, insurance, or investment advice. Opendoor always encourages you to reach out to an advisor regarding your own situation.

Related articles and resources

→ Home sale calculator
→ How long does it take to sell a house in Houston?
→ How a Texas accountant used Opendoor to buy and sell without the hassle

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