When you are thinking about selling your home, you’re probably thinking about how much money you are going to make from the sale of your home. You are likely not thinking at all about how much it is going to cost you to sell your home. After all, a house is supposed to be an investment that grows in value and makes you a profit, right? Yes, your home sale will still give you a lot of money, but there are some hidden costs to selling your home that people often overlook. Here are three hidden costs of selling your home.

Commissions

The first hidden cost of selling your home is the commissions owed to your real estate agent. If you are working with a real estate agent to sell your home, which most people do choose to do, then you are going to have to pay that agent a commission, calculated as a percentage of the sales price of your home. The good news is this is not an upfront cost to the sale of your home, it will simply come out of the revenue you make from the sale of your home.

Repairs and Maintenance

Another hidden cost to selling your home that you need to be prepared for is repairs and maintenance work before selling. It is almost always a good idea to invest a decent amount of money into doing repair work and maintenance to get your house into perfect condition before selling. You can sell your home for cash as-is, but failing to disclose issues can get you into trouble. It is better usually to simply fix major issues and minor issues with your home before selling, it will help you get a better price and stay out of any potential legal trouble.

Taxes

The final piece of the cost puzzle when selling your home is taxes on your home sale. Many people do not realize that they may have to pay a pretty major tax bill on their home sale. The good news is, for most home-sales there is no capital gains tax. As long as your profit is less than the IRS threshold (250k for single filers, 500k for married filing jointly) you don’t owe any tax. If, however, you profit outside of this deduction, you will owe capital gains tax on that amount. This can cost you an extra few thousand dollars depending on how large your profit is.

There are a lot of costs that come with selling a home. The best way to prepare for them is to simply know about them in advance. Make sure you are aware of and budget for these three costs of your home sale.

Check out this article on what to do to prepare for an open house!