Oct 13, 2020 10:54 AM ET
iCrowd Newswire – Oct 13, 2020
How Much Should You Profit From Selling a House?
A lot of people have now become interested in selling houses for a profit. Some are doing it by themselves, while others hire real estate agents to sell for them. Not only that but buying and selling properties are trendy. And while there are homeowners who only sell their houses after a renovation, many opt to do the sale as-is.
But how much should you usually earn when selling a house? Is it enough compared to the expenses you had during the process? Are you getting paid the correct amount? It’s important to remember that your profit will depend on how you sell your property. Read on to find out exactly how much you should earn when selling your home.
How Much Should You Profit?
Remember, your profit will depend on how much you invested on a property. If you are selling a house as is without any repairs or upkeep done, you are more likely to profit more. But you have to do extra work since you need to look for a buyer that will be interested in a fixer-upper home.
If you opt for this option, your market will usually revolve around buyers who are specifically looking for fixer-upper homes or investors who purchase damaged properties for business. Selling a fixer-upper home to a cash buyer will earn you your profit right away without spending extra cash for listings.
If you are a businessman selling renovated houses, your profit will depend on how much you spend to fix or renovate the home you are going to sell. If you are not conscious of your expenses during the renovation, you will end up profiting less than what you deserve to get.
There are no fixed numbers on how much you should profit. You will be the one who will set this for yourself. If you want a more significant profit, you should plan your approach correctly. Expect that things might not go out as planned, so you better prepare a plan B for when things go south.
How to Profit More
Selling a fixer-upper is not a bad thing, per se. Surprisingly, many individuals are willing to buy outdated properties for various reasons. If you wanted to sell your fixer-upper at a higher price, a minor fix should be enough to attract buyers.
You can invest a little by improving the home’s interior design. This way, buyers will steer away from the minor issues the property has and will appreciate your interior. There are five easy ways you can do this without having to spend a lot.
For renovators, only fix what is necessary. Set a budget for the renovation and never exceed the budget. Always put in mind that even fixer-uppers can be sold without fixing. What’s most important is you will profit big on your investments.
Some of these expenses are avoidable, such as the realtor’s commission. Hiring a real estate agent will only lessen your profit due to the fees the realtor will charge you. If you would rather have the 5-6% realtor’s fee straight to your pocket, you should sell the house yourself. It’s a significant amount that will only slip away from you if you hire a realtor for a job that you can do.
Another possible expense you will encounter is the home listing fees that a listing website may charge you. Broaden your options by researching home listing websites that offer free promotion.
There are a lot of free listing websites available on the internet today. However, you have to be more creative in selling your property to guarantee a big profit in return.
Ways to Track Profit
There are ways on how to calculate net proceeds from a home sale. You can do it the traditional way, but you can also use online calculators that can give you fast results with less hassle.
If you want to do it manually, you should always consider the realtor’s commission, expenses you made during the process, remaining mortgage (if any), and any closing and additional fees during the sale.
Do not also forget to deduct taxes you need to pay when selling your property. If you are considering a pre-sale home inspection, you’ll likely have to pay $400 for the service. Note that this inspection is optional. It is your choice to have your property inspected or not.
After figuring out all the expenses you spent, deduct it to the property’s selling price. The remaining money will be your net proceeds. If you think you can manage to sell the house on your own, it is best not to hire a real estate agent since their commission fee is usually the most significant expense you have to pay.
House selling can be profitable, but only if you know how to play your cards well. Figuring out how much profit you’ll earn is very important and should be carefully considered in this business. Profit projection will help you decide the game plan that will make you earn big.