Buying a home is indeed very expensive these days. But did you know? Selling a property is not cheap either. There are multiple expenses that the seller has to undergo while selling the house. So, if you have land in Mannivakkam, then keep in mind the below expenses that you might have to face. Knowing about these costs will help you organise such funds beforehand and help you calculate the actual profit.
Repair and Remodelling Charges
Before selling your property, you need to make it presentable. For that, you have to conduct some fixtures to make the property usable to buyers. Also, if you want to get an edge, then during the sales process, you have to conduct some remodelling work on your property, like installing a modular kitchen, wall repainting or upgrading a brand of fixtures. The remodelling process cost might go higher than you might have expected.
Brokerage
If you have land in Mannivakkam for sale, you might hire a real estate broker to help you with the property selling process. For that, you certainly have to provide him with the commission for all the services provided. The cost of selling the property goes up to a per cent or two from the actual sales price. In many cases, brokers might ask for some flat charge instead of a fixed percentage. However, the brokerage fees are decided by the broker itself.
Advertisement
If you have Mannivakkam land for sale, then you could use some paid advertising methods to find a suitable buyer. You could use the digital platform to give an ad like social media or property websites. Also, you could put an advertisement in the local newspaper or magazine. This way, you could reach out to the prospective buyer looking for a property.
Capital Gains Tax
The capital gain tax liability depends upon the time period you have held your property in question. For instance, if you are selling a property after holding it for more than two years, then you would incur long term capital gain tax. This tax is applicable to the gains made from the sale of the property. And the property that you have owned for less than two years before selling, then you would incur short term capital gain.
Foreclosure Charges
Home loan pre-payment or foreclosure is the expedited or complete repayment of the remaining loan amount through higher than the initially agreed upon equated monthly instalment. If the property in question has been attained through a home loan and you plan to pre-pay the remaining loan amount before starting the selling process, the bank may ask you to pay the foreclosure charges. Lenders charge between one and four per cent of the prepayment amount from borrowers who have taken fixed interest loans. It is advisable to read the loan document thoroughly and know the exact amount to be paid. If your Mannivakkam land price has a floating interest rate, then you are exempted from foreclosure charges.
Documentation Cost
When you sell a property, then it entails some documentation cost of when you bought a home. There are certain documents to be sorted out such as stamp duty, registration and a few others. The cost splits between the buyer and seller, but it being an expense will definitely lighten your pocket.
Window Washing
If you have land in Mannivakkam, it is advisable that clean windows may help sell the home effectively. Clean windows play a great role in increasing the entry of light inside your home and giving a brighter and clearer look. Many people don’t go for cleaning the high panels, but it generally has an effect on the personal consciousness of the buyer.
Agent Commission
Being a seller, you might not have that much luck in getting qualified buyers who are interested in the property. In these cases, the agent is brought into the picture. The agent connects the potential buyer with the sellers with a percentage commission. There are agents who just deal in the luxury apartments selling. When you go to them to sell your property, then the time taken to sell the house might be reduced. Even if you don’t want an agent to sell your property, then you could have any website or firm that you want to list your property and then sell it, which will charge a commission.
Other Closing Cost
Paying the commission to the real estate agent would be the bulk of the commission the seller is responsible for. However, there are some other closing costs that a seller has to pay, like transfer taxes that some states impose when property changes hands. If the property is a part of any homeowners association, then the association might charge a fee. However, these rules vary from state to state. Plus, the closing cost can be negotiated between the buyer and seller as a part of the contract.
Here are some FAQs that you must know!
What closing cost does a homebuyer have to pay?
Homebuyers are entitled to pay a long list of fees like mortgage origination fee, title search fee, property appraisal fee, title insurance premium and first-year home insurance premium.
Is the closing cost tax deductible?
Many of the closing costs are not tax-deductible. However, the exceptions include mortgage interest and real estate taxes. These exceptions are applicable only when the buyer or seller makes a list of item deductions when they file their tax return for the year. However, sellers can adjust their original cost to their adjusted costs basis for their home and can reduce the tax liability.
To Conclude,
Selling your home is not free. The largest expense is likely to be real estate agent commission, but a seller has to pay various other costs and fees.
