Your home is one of your largest assets. Being prepared during the seller process can ensure you make the most of a sale. It can be a surprise to find many hidden costs arise when listing your property. Don't get caught off guard! Kellaprince Properties sets out the most common fees and expenses you can plan and budget for. In this way, you'll also be able to price your home properly for maximum profit.
Property practitioner commission
If you've hired a property practitioner to sell your property, you'll need to pay them for their services rendered. Each agency and brokerage has different rates but the standard fee is between 5-7% plus VAT. You can negotiate the percentage but keep in mind the travelling expenses, time taken for admin and paperwork, and marketing costs property practitioners pour into ensuring a successful sale.
Capital Gains Tax
When selling your house, you may be liable for paying income tax. This applies if it is your primary residence (the home you physically occupy) where the gain/loss exceeds R2 million. If you sell a second or third property (one in which you don't live), you will be liable to declare any capital gain to SARS and pay the tax on that gain.
Clearance certificates
As part of the selling process, you'll need these certificates to confirm your home meets certain standards or requirements:
Inspection and repairs
Although not compulsory, another potentially hidden cost is a home inspection. This can help you pinpoint any hidden defects before you sell. Having this done and making repairs will also give you more negotiating power since your home will be in tip-top shape. You should budget for changes from the inspection as required by your buyer. You may also choose to make adjustments to your home to prepare it for the market such as staging.
Title deed
You will be liable for costs if your title deed is lost or has errors that need to be corrected by a conveyancing attorney.
Bond cancellation
If you have a bond on your property, you'll have to pay a cancellation fee to close it. Financial institutions have different rules and charges. However, you'll likely pay upwards of R4 000 per bond and need to provide a 60 or 90-day written notice to avoid any penalties. It's advisable to send a letter before you list your property for sale so you can prevent this additional cost.
Tenant deposit
If you are renting your property to a tenant, you will need to pay them their deposit back including any interest accrued during their tenancy. You may also need to budget for any repairs required after they vacate the property.
Moving costs
While not a part of the seller process, it is still a cost you should factor in once your house closes. This can include moving furniture from your current property to the next, storage costs, and deposits on municipal services or a rental. Thinking ahead with costs will ensure you have a smooth transition once your sale concludes.
Navigate the seller process without fear
While some of these hidden costs are unavoidable, you can still plan ahead and budget accordingly. Having an experienced property practitioner by your side is indispensable in recognising and managing these expenses. Trust Kellaprince Properties' expert seller agents to help you get through this process with a smile on your face. List your property for sale today and we'll get back to you ASAP.