It’s a universal truth that home sellers hate closing costs, as they make the home sale less profitable. But the good news is that you can avoid them.
You could sell your home to reputed cash home buyers in Phoenix, and if you do this they’ll pay the closing costs for you. Moreover, when you sell your Phoenix home for cash, you avoid agent commissions, title fees, and a range of other costs and hassles.
But if you choose to sell the traditional way, i.e. you hire a real estate agent, you might be able to negotiate who pays the closing costs. For example, in a hot seller’s market—like the Phoenix market the past couple of years—buyers are less likely to request closing costs assistance. They may even spark a bidding war and volunteer to pay the closing costs to make their offers more appealing.
That said, it might not always be possible to eliminate closing costs. But there are many times when this is possible, and these times are what we focus on below. Keep in mind that the viability of these strategies depends on overall market conditions and other factors.
What Are The Closing Costs For Home Sellers In Phoenix?
Sellers generally pay the following costs when closing:
- Agent fees and commissions
- Transfer taxes (varies by state)
- Pre-listing inspection (optional)
- HOA transfer fees
- Prorated property taxes
- Capital gains taxes
Here are a few strategies you can use to reduce these costs:
1. Go For A Cash Sale
If you’re looking to sell a house fast in Phoenix, with minimal fees, a cash sale is your best choice. The highest cost when closing is undoubtedly the agent’s commission. It ranges from around 5% to 6% of the selling price. Generally, sellers pay the commission for both agents involved in the sale. The 6% commission is split between these two agents.
When you sell for cash, you don’t have to hire a real estate agent. Instead, you can reach out to the cash buyer directly, negotiate the selling price, and get the entire profit in cash—there are no fees or commissions.
Selling for cash also eliminates the cost of prepping the home for sale, as you don’t have to bother with repairs, renovations, staging, or open houses—you can sell as is, which will cut down costs further.
2. Negotiate A Lower Agent Commission
Everything is negotiable, including your agent’s fee. While it’s a general practice to pay around 6% to the agent, you can still negotiate the cost with the agent. Volunteer to pay for a specific task, like online marketing, to get the agent to reduce their fees.
That said, most agents are not eager to slash their fees. So, it pays to work out the details beforehand. Alternatively, some agents advertise as “low commission agents,” meaning they charge lower than their peers, usually around 2%. However, remember that you might not get the full service when you work with a low-commission agent.
3. Price Lower Than Comparable Properties
By pricing your home competitively—especially in a seller’s market like Phoenix—it’s likely you’ll receive multiple offers. Buyers will often go the extra mile to woo you. They might even volunteer to take care of all the closing costs, in which case closing would be easier and you’d be able to keep more of your profit.