Seller closing costs in Texas typically total 7-9% of the sale price: agent commissions (5-6%), owner's title insurance ($1,800-$2,200), any negotiated repair credits, HOA transfer fees, and prorated taxes/insurance. On a $300K home: total seller costs are roughly $21,000-$27,000. The largest cost is agent commissions.
Commission: 5-6%
Agent commissions are the largest seller cost, typically totaling 5-6% of the sale price. This is split between the listing agent and the buyer's agent. On a $300K home, that is $15,000-$18,000. Under the new NAR settlement rules, the seller may negotiate buyer agent compensation separately. Commission rates are negotiable.
Title Insurance: Seller Pays Owner's Policy
In Texas, the seller customarily pays for the owner's title insurance policy. This protects the buyer against title defects. The cost is based on the sale price and typically ranges from $1,800-$2,200 for a $300K home. The buyer typically pays for the lender's title insurance policy.
Repair Credits
After the home inspection, buyers may request repairs or credits for defects found. Common repair credits range from $500 to $5,000 depending on the findings. Negotiating repair credits instead of completing repairs can simplify the process, but the cost reduces your net proceeds.
HOA Transfer Fees
If the home is in an HOA, the seller typically pays HOA transfer fees and estoppel fees (a letter from the HOA stating the current status of assessments and any violations). These fees range from $200-$500 depending on the HOA. The seller must also provide HOA documents to the buyer.
Prorated Taxes
Property taxes are prorated at closing. The seller pays their share of the taxes for the portion of the year they owned the home. If you sell mid-year, you will receive a credit for taxes already paid or owe a prorated amount, depending on when taxes were due. In Texas, property taxes are paid in arrears (for the previous year).
NAR Settlement Impact on Commissions
The 2024 NAR settlement changed how buyer agent commissions are handled. Sellers are no longer required to offer buyer agent compensation through the MLS. This potentially lowers the total commission if the buyer pays their own agent directly. However, many sellers still choose to offer buyer agent compensation to attract more buyers and avoid complicating the transaction.
Summary Table
For a $300,000 home sale, estimate: Agent commissions at 6% ($18,000), owner's title policy ($2,000), repair credits ($2,000), HOA fees ($300), prorated taxes ($1,000), and recording fees ($300). Total: approximately $23,600 or 7.9% of sale price. Your agent will provide a detailed closing cost estimate before you list.
