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Transaction Costs of Buying or Selling a Home in Iowa

Discover all transactional costs associated with buying or selling a home in Iowa!

When you buy or sell a home, there are a lot of professionals you will contract or hire to help with the process. The list includes an assessor, multiple inspectors, one to several lawyers, notaries, an appraiser, realtors and more.

Now, think about how they all get paid. Nearly all of the professionals involved with this process get paid a flat fee - except your real estate agent. Each professional that helps with the buying and selling of a home receives a designated fee that does not fluctuate based on the value of your home, while real estate agents earn a percentage based on the sale price. Let’s explore this logic.

How does a Realtor’s job change when listing a home based on the value of the home?

Does your listing Realtor provide different services based on the value of your home? No. Regardless of the price of your home, your realtor will list it on the MLS, market the home, provide you a yard sign and lockbox, show the home to potential buyers, coordinate negotiations and coordinate closing documents and contracts. Effectively, the listing Realtor’s function is the same no matter the price of the house. Yes, there are different audiences for different price ranges of homes, but the services a listing agent provides do not differ.

Who else is involved in buying and selling a home aside from the Realtor?

Many individuals or contractors need to come to a home before it is bought or sold including, but not limited to:

  • An assessor - A representative of the county that you live in who assesses your home’s value for tax purposes. The value that the assessor places on your home will be the value on which your property taxes are based. You do not need to pay an assessor  as he or she is employed by the county.

  • An appraiser - Represents your bank or lender and assesses the value of your home to help determine the loan amount the bank will provide. The appraiser is paid a fee for his or her services that is usually between $300 and $400, depending on the state you live in, but not the value of your home.

  • An attorney - In Iowa, the attorney is typically contracted by the bank or closer coordinating the sale of your home.  Generally, the fees associated with the attorney review and preparation of documents are paid based on the attorney’s hourly rate and complexity of the document review.

  • Pest inspector - Will typically need to be hired to evaluate the home before closing documents are signed. This can vary in price depending on the company you choose to conduct the inspection, but buyers pay on average $100 for a whole home pest inspection.

  • A home inspector - Will inspect the home to assess the condition of the exterior and interior of the home, as it relates to life and safety issues. This inspection is important because it prepares the buyer for what repairs mayneed to be made. A thorough home inspection will usually take two to three hours and range between $300 and $500.

  • Your bank or lender will have multiple fees that need to be paid to secure your loan. These fees can include:

    • Escrow: A deposit that is paid to a third-party holding company who oversees the closing of the home purchase and ensures the set terms and conditions are carried out. Escrow guarantees no funds or property will change hands until all of these terms have been met. Buyers will usually have to place a base fee of about $300 into escrow.

    • Credit report: The bank will run your credit report to help determine the size of the loan they will provide you with as well as the interest rate you will be charged. The credit report will cost a maximum of $30.

    • Underwriting fee: Will likely be charged by your bank to cover the administrative expenses of researching your approval rating as well as the paperwork of processing and approving your loan. The price varies based on the bank or lender you use and should be negotiated when you are discussing the terms and conditions of your loan.

  • A land surveyor may need to come to inspect the property lines that are drawn into contracts. The land surveyor will likely cost somewhere between $450 and $800.

Space Simply - Flat Fee Real Estate

Most of the professionals listed above provide the same service on your home sale regardless of the price of your home, and so does the Realtor that lists your home!  Space Simply charges a flat fee of $2,495 to list and sell your home, without sacrificing any services. In addition to the listing fee, the buyer’s agent is compensated based on the sale price of the home. Find out more about how flat fee realty works with Space Simply by contacting us at (515) 423-0899 or connecting with us online today!