Selling a property, what to consider?

[Shaolin]

Hi all,

I'm looking to sell one of my investment properties and am looking to calculate my breakeven price to know how much I should at least sell it for.

What I don't know with 100% certainty are the fees associated with a sale.

Say I put my property on the market for $300,000 and I didn't put 20% down on the property when I bought it.

I think I have to consider the following:

Closing costs (Lawyer fees)
GST
Realtor fees (if I decide to go with one)

Are there anything else I'm missing?

Does anyone know what the closing costs are for a property?

Realtor fees I believe are 7% on 1st $100,000 and 3% for the remaining correct?

So with a $300,000 example, the breakdown will be

Realtor fees 10% - $7000+$6000 = $13,000
GST 5% - 15,000
Remaining Closing Cost to consider - ???

So as of right now, the cost of sale would be $28,000 with a $300,000 example.

Can anyone help me out with the rest of it?

[navdeep]

i dont think you need to pay GST i might be wrong

[cet]

You may need to update your real property report if any improvements have been made that will have affected it.
Any penalties for paying out your mortgage early if you are

[roopi]

Originally posted by navdeep
i dont think you need to pay GST i might be wrong

Realtor Fees do require GST as well.

Also consider if their is a penalty for your mortgage. Lawyer fees will range from $750-$1100.

[Tik-Tok]

Originally posted by roopi


Realtor Fees do require GST as well.

Also consider if their is a penalty for your mortgage. Lawyer fees will range from $750-$1100.

Yes, but he's calculated 5% gst on the selling price of the house.

There may be tax payment required as it's a revenue property, but it won't be on the whole amount, just the difference between the inital buying price and his selling price.

[ercchry]

realtor fees (negotiable, but you are correct in thinking its going to be 7/3%) gst is only on this bit
cap gains (up to 20% of the sell price minus original purchase price and expenses)
mortgage penalties (this is dependent on what product you have)
lawyer fees (less than purchasing, but still a bit)
updated real property report (only if any changes have been made, ie. you put up a fence where there was none before, this is ~$1k if i remember right)
pay up taxes for the year if you are on tipp
cleaning fee, chances are if it was an income property before you will need to get a pro in to clean it. our buyers wrote this into the contract actually when we did this last.

[avishal26]

Sale price: $300,000

Lawyer fees: $~1,000

RPR update: $750 (if you contact the original surveyor who did the first RPR - not sure if this even applies to an apartment...)

Realtor fees: $13,000 + GST = $13,650

Cleaning / Moving: $2,000 approximation

Hopefully no mortgage penalty

If original purchase price = $250,000, then you are looking at $10,000 in capital gains tax (20% x $50,000 price difference).

Total costs: $1,000 + $750 + $13,650 + $2,000 + $10,000 = $27,400

Net = $272,600

[ercchry]

Originally posted by avishal26
Sale price: $300,000

Lawyer fees: $~1,000

RPR update: $750 (if you contact the original surveyor who did the first RPR - not sure if this even applies to an apartment...)

Realtor fees: $13,000 + GST = $13,650

Cleaning / Moving: $2,000 approximation

Hopefully no mortgage penalty

If original purchase price = $250,000, then you are looking at $10,000 in capital gains tax (20% x $50,000 price difference).

Total costs: $1,000 + $750 + $13,650 + $2,000 + $10,000 = $27,400

Net = $272,600

i'd calculate cap gains AFTER you factor in the closing costs... but yeah... close enough

[Shaolin]

Thanks guys for all your help!

[ganesh]

Originally posted by ercchry


i'd calculate cap gains AFTER you factor in the closing costs... but yeah... close enough
No Capital gain if that is your primary.

[JordanLotoski]

Originally posted by avishal26
Sale price: $300,000

Lawyer fees: $~1,000

RPR update: $750 (if you contact the original surveyor who did the first RPR - not sure if this even applies to an apartment...)

Realtor fees: $13,000 + GST = $13,650

Cleaning / Moving: $2,000 approximation

Hopefully no mortgage penalty

If original purchase price = $250,000, then you are looking at $10,000 in capital gains tax (20% x $50,000 price difference).

Total costs: $1,000 + $750 + $13,650 + $2,000 + $10,000 = $27,400

Net = $272,600


Pretty close, he might be able to update his RPR for less, 500-600 as well as cheaper legal fees.

[ercchry]

Originally posted by Shaolin

I'm looking to sell one of my investment properties ...



Originally posted by ganesh

No Capital gain if that is your primary.

good thing we are working with all the info :thumbsup:

[ganesh]

Originally posted by ercchry





good thing we are working with all the info :thumbsup:

My apologies I didn't see that.

[gwill]

Ugh a big one is carrying costs and staging. Last thing you want to do is list when you have renters in there and who knows how long it takes to sell when you do list. I just did that with my one property and it was a pain in the ass. Had my property listed with my renters for 2 months hoping to avoid carrying costs but it Didnt work out as planned so i staged it. Day after staging i had an offer on it before i even had photos of the place on MLS.