Selling your home in Florida isn’t free. Along with paying to get your home ready to sell (improvements, paint touch-ups, etc), you’ll also need to cover a variety of closing costs.
Exactly what you must pay for and how much you’ll owe varies.
What are Closing Costs?
Closing costs are the costs associated with buying a home and selling a home.
In Florida, buyers and sellers split closing costs, but it isn’t an even split.
Sellers pay the bulk of expenses, the largest of which is often the real estate commission for both realtors.
The Most Expensive Closing Cost Line Items Are Usually:
- Realtor Fees
- Title Services
- County Taxes
- State Transfer Taxes
How Much Are Sellers’ Closing Costs in Florida?
As a seller, closing costs vary. Typically, you can expect to pay 8% to 10% of the sale price of the home for closing costs.
The median sale price for a home in Florida was $399,900 in the first quarter of 2023.
If you sell a home at that price, the closing costs would be an estimated $31,992 to $39,990.
Don’t panic if you don’t have that kind of cash lying around. Most sellers don’t pay closing costs out of pocket. Instead, the costs come out of the proceeds from the sale of your home.
What Are the Home Sellers Closing Costs in Florida?
Sellers typically pay realtor commission fees, transfer tax, title insurance, and other related fees at closing.
However, no two real estate transactions are the same.
Whether an expense is covered by the buyer or seller depends on the purchase contract.
Real Estate Commission
More often than not, the home seller pays the real estate commission to the listing agent and the buyer’s agent. In Florida, realtors commonly earn 2 to 3 percent of a home’s sale price, which brings the total commission to 4 to 6 percent of the home’s sale price.
The more your home sells for, the more you’ll pay the realtors involved.
Real estate commission in Florida is negotiable. Always ask an agent about their fees during the initial hiring process so that you know what to expect.
You can find realtors with discounted fees. Just remember, you do get what you pay for. Using a discount realtor comes with a cost. Often, it means limited time and resources for marketing and showing your home.
The more the realtor stands to gain from the sale of your home, the more invested they’ll be in helping you sell your home for top dollar.
Title Search Fee
A title search checks if the home is clear with no judgments or unpaid claims.
In Florida, the buyer or the seller could be responsible for this fee. Title search fees vary.
Owner’s Title Insurance
Title insurance protects the buyer in case any issues arise with the home’s title. For example, someone else claiming ownership of the property or a contractor claiming they weren’t paid for work completed on the home before you bought it.
It’s a one-time fee that protects against any financial loss associated with title issues.
Although title insurance benefits the buyer, the seller typically pays for it. You can shop around for title insurance to save some money.
Transfer Tax (Documentary Stamp Tax)
Florida charges a property transfer tax, also called a documentary stamp tax or state deed transfer fee, when a home changes ownership. The tax covers the fee for transferring the title of the property from one person to another.
The cost is a percentage of the home’s sale price.
In Miami-Dade County, the transfer tax is 0.60% for single-family homes and 1.05% for non-single-family homes.
In the rest of Florida, the transfer tax is 0.70%.
The fee is typically covered by sellers in Florida. However, if it’s a seller’s market, you might find a buyer willing to pay the tax.
Prorated Property Taxes
If you haven’t paid any real estate taxes up front, it’s common to give the buyer a credit at closing to cover the days that you owned the home in the calendar year that you haven’t yet paid taxes for.
Fortunately, Florida property taxes are low compared to many other states.
Other Prorated Fees
Sellers often cover fees for any services or utilities they used while they owned the home but haven’t yet paid for. For example, quarterly water bills, trash or sewer bills, HOA fees, etc.
If you hire a real estate attorney, you must pay for their services at closing.
Costs vary, so if you choose to use an attorney, shop around to find one that fits your budget.
Note About Attorneys in Florida Transactions
Most Florida residential real estate transactions do not involve attorneys. Real estate agents handle the contracts, and title services handle the closing of the transaction. Hiring an attorney in Florida is completely up to the sellers discretion, but not necessary or common.
Credit Toward Closing Costs
Some sellers offer a credit to help the buyer pay for closing costs. This is more common in a buyer’s market or when selling to first-time homebuyers.
If this is part of the negotiated contract, you will take care of it at closing.
When Do I Find Out What I Owe for Closing Costs?
Your realtor should prepare a seller’s net sheet for you. This is an itemized list of all the closing costs as well as how much you will net after the sale of the home.
Buyers typically need to bring cash to closing.
Sellers often don’t.
If you have a mortgage, the money from the sale will first go toward paying that off in full. Then, your closing costs will come out of what’s left over.
If there isn’t enough left over to fully cover the closing costs, you will need to make a payment at closing.
FAQs About Seller’s Closing Costs
Do Sellers Always Pay the Real Estate Commission?
Typically yes. The standard practice is for sellers to cover real estate fees. However, you can account for this expense when pricing your home for sale.
Do Sellers Owe Anything Out of Pocket at Closing?
Typically no. The proceeds from the sale of the home often cover any remaining mortgage balance plus your closing fees. If they do not, you will need to make a payment at closing.
Who Pays the Majority of Closing Costs in Florida?
Sellers pay for the majority of closing costs in a Florida real estate transaction. The largest expense is the realtor commission fee.
How Can a Seller Reduce Their Closing Costs in Florida?
Some closing fees are set in stone, such as the transfer tax. Others are negotiable. Ways you might be able to reduce closing costs include:
- Negotiate real estate agent commission fees
- Shop around for an attorney
- Research and compare the cost for title service companies
- Ask the buyer to cover your closing costs