What Are the Average Closing Costs for Selling a Home in Denver, CO?
If you’re planning to sell a home in Denver, it’s essential to budget for closing costs, which typically range between 6% to 10% of the home’s sale price. These costs cover a variety of fees and services involved in the transaction. Here’s a breakdown of the average expenses sellers can expect in Denver and how they impact your final profit.
1. Real Estate Agent Commissions
The largest closing cost for sellers is usually the real estate agent’s commission, which averages 5% to 6% of the sale price. This fee is typically split between the listing agent and the buyer’s agent. While this cost may seem substantial, a professional agent brings expertise in pricing, marketing, and negotiating, often helping sellers achieve a higher sale price and smoother closing process.
2. Title Insurance and Escrow Fees
Title insurance and escrow fees protect both the buyer and the seller by ensuring there are no outstanding claims against the property. In Denver, title insurance and escrow fees usually range from 0.5% to 1% of the sale price. These fees cover the title search, issuance of the title insurance policy, and the escrow company’s services in managing the transaction. While buyers sometimes pay for their own title insurance, sellers are often responsible for covering the buyer’s policy in Denver.
3. Transfer Taxes and Recording Fees
Denver home sales are subject to transfer taxes and recording fees, which cover the cost of recording the sale with the county. Transfer taxes in Colorado are relatively low compared to other states, often amounting to around 0.1% of the sale price. Recording fees, which are charged to officially update property records, are generally nominal but still worth accounting for.
4. Potential Repairs or Concessions
During negotiations, buyers may request certain repairs or concessions, which can add to your closing costs. For example, a buyer may request a credit for repairs based on the home inspection findings, or you may agree to cover some closing costs as a seller concession. These costs vary but can range from $1,000 to $5,000 or more, depending on the scope of repairs or concessions needed to close the sale.
5. Other Closing Costs
Additional costs to consider include home warranty fees, prorated property taxes, and any outstanding HOA fees. Sellers may also need to pay prorated utility bills or HOA dues up to the closing date. Home warranties, often requested by buyers, cost around $300 to $600 and offer peace of mind by covering repairs after the sale. Prorated property taxes and other small fees add up, so it’s wise to factor them into your closing cost estimate.
Calculating Your Total Closing Costs
On average, closing costs for sellers in Denver amount to 6% to 10% of the home’s sale price, depending on the specific services and concessions involved. Working with a knowledgeable agent can help you accurately estimate these costs, identify areas for potential savings, and prepare for a smooth closing.
If you’re considering selling and want to better understand the financial side of closing costs, feel free to reach out for a personalized estimate based on Denver’s current market.
