The Phoenix real estate market is still tight after the interest rate hikes in 2022, and home sales are still a little slow in this part of the world.
So, if you're a seller who wants to sell your home fast, you might consider lowering your price to attract more buyers. It's unwise to do this until you can calculate how much you might expect to receive after the sale.
Closing costs will take the biggest chunk of your ROI when selling a home. Before you set a price, read on to explore the average closing cost for a seller.
What Are the Typical Closing Costs in Phoenix?
Closing costs are the extra fees paid by the buyer and the seller during a property transaction. For buyers, this usually means bringing additional money to the closing table.
In the case of sellers, these fees are most often deducted before they receive the proceeds from their home sale. The most common closing costs in Phoenix, AZ, are:
Mandatory Fees
In Arizona, there are a few closing costs that buyers or sellers must pay during the sale of a home. These are:
- Recording fee
- Escrow fee
- Owner's title insurance
- Outstanding or prorated property taxes
- Prorated or outstanding HOA fees
- Wire transfer fees to pay off the existing mortgage
- Transfer fee
Buyers who need to apply for a mortgage will also pay an appraisal fee and loan origination fee. Each of these fees costs between a few hundred and a few thousand dollars.
Variable Costs
There are some costs that buyers or sellers can avoid with a prior agreement. Likewise, these variables might form part of the conditions of the sale. These fees include:
- Home inspection fees
- Termite, radon, mold, and pest inspection fees
- Home warranty and optional home warranty fees
- Pool inspection fees
These inspection and warranty fees are usually in the region of $500 each. If you work with a real estate agent, you must pay around 6% of the sales price for the agent's commissions.
When you sell your home as-is for a low price, the buyer might agree to forego these costs. However, if you sell your home to a mortgaged buyer, their lender will likely insist on a home inspection before they agree to loan the money.
In these cases, the seller might also find themselves compelled to make necessary repairs to the home.
Breaking Down the Average Closing Cost for a Seller
When you take all the above fees into account, the seller can expect to pay as much as ten percent of the value of the home in closing costs. This amounts to over $40,000 when calculated on the median home price in Phoenix, which is $428,000.
Sell Your Home Fast and Reduce Closing Costs
Closing costs can eat into your profits when selling your home via traditional means, but you can avoid many of these costs by selling to a cash buyer. You can save even more when you sell to a cash investor without getting a real estate agent involved.
AZ Homebuyer LLC frees you from the headaches that agents, contractors, and inspectors can cause. We help you save money on commissions, fees, and repairs.
Get a fair, no-obligation offer on your Phoenix home today and sell it in a time frame that suits you.
