Condo Selling 101

Closing Costs and Commission

You often hear about closing costs for home buyers, but there are closing costs for the seller's side as well.

If you use a listing agency to help in selling your condo, you will be required to pay for their services. This comes in the form of a commission on your condo's sale price. Regular brokerages generally charge between 4 and 7 percent of the final sale price. This will include the cost of listing, marketing, showing, and selling your condo.

The commission is sometimes a cause for concern for sellers because it cuts into the profit on their sale. But the alternative (For Sale By Owner) can end up costing you more in the long term. The longer a property stays on the market the more it costs the seller and the less likely it is to sell for full price.

Time and expertise have a value, and a licensed real estate agent provides both. Without an agent you are responsible for doing everything on your own. This includes marketing the listing, holding open houses, coordinating tours with buyer's agents, showing the condo, preparing all paperwork, and keeping track of what you need to make the transaction legal and binding. This will take time out of your day and require much organization and knowledge of how the selling process works. You need to be available around buyers' schedules, which can be difficult if you have a full-time job. As they say "time is money" and it will consume a lot of your time (read "money") to sell a condo by yourself.

Another important aspect of hiring a professional when selling a condo is their ability to market your property and negotiate the price. Remember, listing brokers do this for a living and have proven methods for advertising homes to capture buyer traffic. This can be done in print and on the web. Research several agencies and compare their marketing tactics. Any brokerage worth its weight will put its listings online and most have web sites now, too. Agents can provide leverage in negotiations with statistics on comparable sale prices and market trends. Along with an appraisal, the data is evidence of your condo's value and is used to substantiate its price to buyers.

Additional fees that may apply when selling a condo in your area are: property transfer tax, home inspection fee, release of mortgage, courier fee, policy of title insurance, association fee transfer, and unpaid real estate tax credit. Seller closing costs vary from state to state, so it is important to research what sellers are responsible for paying in your location.