Sellers

When you sell your home, you can’t expect to take home all of the sale price. There are many fees to pay – commissions, taxes and miscellaneous and they can take out up to 7% of the sale price.

How do you determine your net profit? When you receive an offer, your real estate agent will give you a Seller’s Estimated Net Proceeds worksheet, which will give you an idea of all the costs that will be deducted when you close.

Here are some of the costs that could are usually deducted from the sale price. They may vary depending on yoru state.

• Mortgage payoff balance.
  They can include your own home loan, second mortgages and home equity lines of credit.  
• Loan payoff fee.
  Some lenders charge an administrative fee to pay off your loan.
• Lien release document.
  If you need to pay for a contractor, court judgments or for property taxes, you’ll need to settle them first before you could close the sale.
• Prepayment penalty.
  Ask your lender if you’ll need to pay for a prepayment penalty if you pay for your loan early.
• Recording fees.
  If you previously loaned on the house, you’ll need to pay this fee to show that you’ve paid for it already.
• Commissions for agents.
  This is the fee you pay to both your agent’s brokerage and your agent’s brokerage. Usually this takes off 6% from the sale price. This amount is split by the two brokerage and they are in charge of paying each agent.
• Notary fees.
  You pay a notary to confirm your identity and verify the documents.
• Escrow fees.
  The escrow serves as a third party. An escrow ensures that the money is protected while negotiations and processing of necessary documents are still ongoing. You could split the escrow fee with the buyer.
• Title search fees.
  Before the sale of a home could be finalized, a title company does a search on public records to verify if the property is free from any issue and can be sold.
• Seller concession. 
  You and the buyer might agree to the price of a house but the buyer asks for a 3 percent closing cost concession.  3% is given back to the seller to pay for the closing costs.
• Repairs.
  If repairs are necessary, you’ll need to set aside a portion of the sale to spend for it. Sometimes it’s the buyer who requires it and sometimes, the lender.
• Home warranty.
  There are times when the buyer asks the seller to pay for a home warranty which offers protection for the buyer’s first year in the house.
• Termite letter. 
  Some states require this. It indicates that the house is free from termites.

There may be more costs not mentioned here. It’s best to ask your real estate agent so you can anticipate and prepare for it.

The outside of your home is the first thing that buyers will notice. It’s what gets them interested in your home. If you’re thinking about improving your home, you’ll be getting your money’s worth if you do a good job on the exterior.

According to Remodeling Magazine’s 2009-10 Remodeling Cost vs. Value Report, six out of the top ten remodelling projects were all related to outside improvements. The report surveys realtors across America. Based on the report, even a simple move like replacing a steel door for about $1200 can recoup more than 120% of your investment when you sell the house. An attic bedroom which costs $49,350 yielded $40,990. It brought back about 83% of what was invested. Adding a deck returned about 80% of the cost.

One of the primary reasons why people invest in outdoor improvements is that it doesn’t cost much and the investment will surely pay off. Usually, exterior improvements costs less than $15,000 but it can do a lot for your home’s curb appeal. Curb appeal is important because it holds the key to selling your home. Midrange outdoor projects in the report’s top 10 are a deck addition, vinyl siding replacement, wood and vinyl window replacements and steel and fiberglass door replacements.

Another reason for exterior improvements is energy efficiency. Plus, homeowners can get tax credits for weatherizing their houses under the American Recovery and Reinvestment Act. Improvements like upgrading windows, roofs and siding can be counted towards it. In the process of doing this, homeowners are also making their houses marketable.

It’s also a good investment to improve your kitchen and bathroom, but don’t spend too much. A small kitchen remodelling in a midrange house that costs $21,410 can yield about $16,775 or about 78 percent of its cost when you sell. If you decide to do a major renovation that costs $57,215 you can expect to recover $41,260 or 72 percent.

In an upscale home, a major kitchen remodelling at $111,800 can give you about 63 percent of your investment while a bathroom costing $52,300 would give you a little more than 61 percent.

Improvements in a home office or sun room can only yield about 50 percent of construction costs.

Buyers in general are more attracted to houses with fireplaces. They give a warm and cozy feel. They usually become the centerpiece of a room. Fireplaces add to the aesthetic appeal of a house.

They also keep houses warm during cold times. Even though there are already other possible sources for heat, it can still come in handy when there is no power during storms.

There are other states like California where a house a house needs to have a fireplace in order to be sold. But Gopal Ahluwalia, director of research for the National Association of Home Builders, says, “you probably don’t need one more than three days a year.” He says, “lifestyle is guided by the conditions of the economy. When you have money left over, you want to spend it on things you don’t need.”

Now that houses have become expensive and people are looking for ways to be cost-effective, are houses with fireplaces still popular? Is it worth the investment? According to experts, a fireplace can be paid for over time in a 30-year mortgage. And there are lower interest rates available.

Kira McCarron, marketing director of Toll Bros, which builds luxury houses in almost 20 states says, “The concept of fireplaces has changed. The shift from masonry to prefab designer boxes has put fireplaces in bathrooms, dining rooms and bedrooms, as well as living rooms and family rooms.” You can even find fireplaces on walls of entertainment rooms, below big-screen televisions, “so that you have your choice of what you want to see,” she says.

This is all made possible by technology. Now we have gas fireplaces because it is already possible to vent gas outside through a wall without a traditional chimney. Flexible pipes allow gas to go to the units. Usually houses have both – a wood fireplace in the living room and gas on the other rooms.

Burning wood can cause health and environmental problems. According to the U.S. Department of Energy, wood-burning appliances and fireplaces can release large quantities of air pollutants like nitrogen oxides, carbon monoxide, organic gases, and particulate matter. They can cause serious health problems particularly to children, pregnant women and those with respiratory problems. These chemicals have properties similar to cigarette smoking that are associated with cancer. Many areas consider smoke from wood burning as one of the major cause of air pollution.

Because of the availability of vent-free fireplaces, homes can now enjoy having several units instead of just one. However, vent-free appliances also come with safety concerns. In fact some states ban the use of vent-free fireplaces. And even in states where it can be used, some county government prohibit its use.

According to the U.S. Department of Health and Human Services the key to reducing health risks linked to vented and unvented heating appliances is proper maintenance.

Contractor John Burke puts a priority on safety when he installed a vent-free fireplace in his house. “There had to be a constant supply of fresh air in that house to guarantee safe operation,” Burke says. “Fortunately, the house was old and drafty, and there was never an issue.” The unit he bought came with a carbon monoxide monitor and an oxygen-depletion sensor. Once the level of oxygen in the room reaches a dangerous level, the fire turns off immediately.”Never leave a gas fireplace running when you aren’t in the room,” Burke says. “And make certain that you shut it off when you go to sleep for the night.”

Usually a gas fireplace costs between $600 to $3,000, excluding installation. Electric fireplaces usually cost between $1,200 to $1,500, but you can expect it to generate enough heat to take the edge off one or two rooms.

When you have an older house, you’ll have a problem with chimney lining, says developer Mark Wade. He rehabs older city homes. Home inspectors suggest that stainless-steel liners be installed in old chimneys. However, it will cost a lot. A stainless steel installed from fourth floor to the basement typically cost $3,000 for about 1 1/2 hours’ work.