Selling your home with a Realtor generally moves through six stages: hiring an agent, signing a listing agreement, preparing and pricing the property, marketing and showing it, negotiating offers, and closing. Plan on total transaction costs of roughly 8% to 10% of the sale price once commission, closing costs, and any transfer taxes are added together. The sections below walk through each stage and show where that money goes.
Hiring the Right Agent
Interview at least two or three agents before you commit. Ask about recent sales in your neighborhood, their average days on market compared to the local average, and specifically how they would market your property. Volume matters, but so does communication. An agent who closes 50 homes a year while delegating everything to assistants may not give your sale the attention it needs.
Once you hire someone, the relationship is a fiduciary one. The agent owes you loyalty, confidentiality, and a duty to act in your best interest, particularly on price and terms.1National Association of REALTORS®. Consumer Guide: Agency and Non-Agency Relationships Those duties are defined by state law and enforced through the listing agreement you sign.
Signing the Listing Agreement
The listing agreement is a binding contract between you and the agent’s brokerage. The most common form is the exclusive right-to-sell, which pays the agent a commission if the property sells during the contract period, no matter who finds the buyer. Even if your neighbor knocks on the door with an offer, the agent is still paid.
A less common alternative is the exclusive agency agreement, which lets you find a buyer on your own without owing commission. Most agents prefer the exclusive right-to-sell because it guarantees compensation for their marketing effort. Contract durations typically run three to six months and are negotiable.
Three terms deserve attention before you sign: the expiration date, the commission rate, and the protection period. The protection period, sometimes called a tail clause, extends the agent’s right to a commission for a set window after the contract ends. It covers the situation where a buyer the agent introduced during the listing period comes back later to purchase the home.
How Commissions Work After the 2024 NAR Changes
Commissions have always been negotiable rather than fixed by law. Historically, the total ran 5% to 6% of the sale price, with the seller paying the full amount and the listing brokerage splitting it with the buyer’s agent through the MLS. That changed in August 2024.
Following an antitrust settlement, the National Association of REALTORS® implemented new rules that prohibit offers of buyer agent compensation from appearing on any MLS platform.2National Association of REALTORS®. What the NAR Settlement Means for Home Buyers and Sellers You can still offer to pay the buyer’s agent, but that offer now happens off the MLS. You can also offer buyer concessions on the MLS, such as credits toward closing costs, which buyers might use to cover their own agent’s fee.
The other change: buyer agents must now sign a written representation agreement with their client before touring any home.3National Association of REALTORS®. NAR Settlement FAQs That agreement spells out exactly what the buyer’s agent will be paid and who pays it. For you as a seller, the old assumption that you’d automatically fund the buyer’s agent through a 2.5% to 3% co-op commission is no longer automatic. You may still choose to offer buyer agent compensation to attract more showings, or you may negotiate a lower listing-side commission and let buyers pay their own agent. Commission is now a more open conversation than it used to be.
Preparing the Home
Before a single photo is taken, your agent will walk through the property and recommend repairs, updates, and staging. A good agent earns their commission here by knowing which fixes actually move the price and which ones waste money.
At a minimum, address anything that will show up on an inspection report: leaky faucets, missing handrail balusters, GFCI outlets that don’t work, and HVAC filters that look original. Fresh paint in neutral colors and updated light fixtures deliver outsized returns relative to their cost. Deep cleaning, including carpets, windows, and grout, is non-negotiable.
Staging arranges furniture and décor to help buyers picture themselves in the space. In a 2025 NAR survey, nearly half of listing agents reported that staging reduced the time their listings spent on the market, and 29% said staging produced a 1% to 10% increase in the dollar value offered.4National Association of REALTORS®. NAR Report Reveals Home Staging Boosts Sale Prices and Reduces Time on Market On a $400,000 home, even a 3% bump is $12,000. Some agents include basic staging in their services. Others will recommend a professional stager at your expense.
Disclosures You Have to Make
Every state requires some form of seller disclosure, though the specifics vary. The common rule: you must tell buyers about known material defects, meaning problems that could affect the home’s value or safety. Lying by omission on a disclosure form is one of the fastest routes to a post-closing lawsuit, and courts tend to side with buyers when a seller clearly knew about a problem and stayed quiet.
For any home built before 1978, federal law adds another layer. You must give buyers an EPA-approved pamphlet about lead-based paint hazards, disclose any known lead paint issues, hand over any inspection reports you have, and allow the buyer at least 10 days to conduct their own lead inspection before the contract becomes binding.5eCFR. Subpart A – Disclosure of Known Lead-Based Paint and/or Lead-Based Paint Hazards Upon Sale or Lease of Residential Property Both parties sign a lead disclosure attachment that becomes part of the purchase contract, and you must keep a copy for at least three years.
Your agent will also pull county records to verify boundaries and surface any title issues. Have current property tax statements ready, and if the home is in an HOA, gather the fees, rules, and financial statements. Having the paperwork lined up early prevents delays once offers come in.
Setting the Price
Your agent will prepare a comparative market analysis, or CMA, using recent sales of similar homes nearby to recommend a listing price. The analysis adjusts for differences in square footage, lot size, condition, and location, and factors in current inventory and how quickly homes are moving.
Overpricing is the most common seller mistake, and it costs more than people realize. A home that sits develops a stigma. Buyers assume something is wrong with it, and you end up chasing the market down with price reductions that signal desperation. Homes priced correctly from the start consistently sell faster and closer to asking price than homes that start high and reduce later. Trust the comparable sales data even when your instinct says the home is worth more.
Marketing and Showings
Once the listing goes live, your agent enters the property data into the Multiple Listing Service, which feeds the major real estate websites where most buyers start. Professional photography matters here. Listings with high-quality photos generate significantly more online interest than those with phone snapshots, and most buyers find the home online before ever visiting in person.
Your agent handles showing requests, typically through electronic lockboxes that require verified credentials and log every visit. Open houses give a broader audience a chance to walk through during a set window, usually on weekends. Your agent collects feedback and watches for patterns. If multiple buyers raise the same objection, like an outdated kitchen or an awkward floor plan, that feedback informs whether a price adjustment or targeted improvement makes sense.
Expect disruption during this stretch. You’ll need to keep the home show-ready, leave quickly for appointments, and secure valuables and personal documents before each visit.
Reviewing and Negotiating Offers
An offer will include the proposed purchase price, the earnest money deposit (usually 1% to 3% of the offer price), the buyer’s financing details, the proposed closing date, and any contingencies. Contingencies are conditions that must be met before closing, and the most common ones cover inspection, financing, and appraisal. Each one gives the buyer a defined window to back out and recover their earnest money if the condition isn’t satisfied.
You have three options with any offer: accept it as written, reject it, or counter. Counteroffers are where most of the real negotiation happens. You might counter on price, push back on the closing timeline, exclude certain fixtures, or ask the buyer to waive a contingency. Every element is negotiable until both sides sign the same version. Once you do, the property goes under contract and the contingency clock starts.
With multiple offers, price isn’t the only factor. A slightly lower cash offer with no financing contingency may be stronger than a higher offer from a buyer with shaky loan approval. Your agent should walk you through each offer’s relative strength, including pre-approval status, timeline, and any concessions requested.
If a Buyer Backs Out
The contingency period is the most fragile part of the deal. If the inspection reveals significant problems, the buyer can request repairs, ask for a price reduction, or cancel outright under the inspection contingency. If the lender’s appraiser values the home below the contract price, the buyer can walk under the appraisal contingency, or you can negotiate to meet somewhere in the middle.
When a buyer cancels within the terms of a contingency, they get their earnest money back. If a buyer walks away for a reason not covered by a contingency, they typically forfeit the deposit to you. It cuts both ways. If you as the seller refuse to close after signing without a legal basis, the buyer can sue for the deposit, pursue monetary damages, or in some cases seek a court order compelling you to complete the sale. Once you sign, you’re obligated to follow through unless a buyer-side contingency failure gives you an exit.
Closing the Sale
After all contingencies clear, the transaction moves toward closing. The buyer will schedule a final walkthrough, usually within 24 to 48 hours of the closing date, to confirm the property is in the agreed-upon condition and any negotiated repairs were completed. If you promised to fix the roof and it’s still leaking, expect either a delay or a last-minute renegotiation.
Closing itself happens at a title company or attorney’s office, depending on your state. Roughly a dozen states require an attorney to conduct or supervise closings; the rest allow title companies. You’ll sign the deed and various settlement documents. The title agent verifies that all existing liens, including your remaining mortgage balance, are paid from the sale proceeds before anything reaches you.6Consumer Financial Protection Bureau. Review Documents Before Closing
Your mortgage payoff will be slightly more than your remaining principal because interest accrues daily. The title company requests a payoff statement from your lender in advance with a per-diem charge calculated through the expected closing date. If closing is pushed back, the payoff rises accordingly. Once everything is signed and funded, your proceeds are wired or paid by certified check after commission, closing costs, and outstanding balances are deducted. Keep the ALTA Settlement Statement the title company gives you.7American Land Title Association. ALTA Settlement Statements You’ll need it for your tax records.
What Sellers Pay at Closing
Beyond commission, sellers typically pay another 1% to 3% of the sale price in closing costs. These include title insurance (the buyer’s policy, which the seller customarily pays in many markets), escrow fees, recording fees, and prorated property taxes. Any buyer concessions you agreed to, like covering part of the buyer’s closing costs, also come out of your proceeds.
Most states impose a real estate transfer tax when property changes hands. Rates run from a fraction of a percent to over 2% in higher-cost states, and some states charge nothing. Your agent or title company can tell you what applies locally. Ask for a net sheet, an estimate of what you’ll actually walk away with, before accepting any offer. Running one takes minutes and prevents the unpleasant surprise of discovering at the closing table that your proceeds are $15,000 less than you expected.
Taxes on the Sale
Most homeowners selling a primary residence owe nothing in capital gains tax, thanks to the Section 121 exclusion. If you owned and lived in the home as your principal residence for at least two of the five years before the sale, you can exclude up to $250,000 of profit from taxable income. Married couples filing jointly can exclude up to $500,000, as long as both spouses meet the use requirement and at least one meets the ownership requirement.8Office of the Law Revision Counsel. 26 USC 121 – Exclusion of Gain From Sale of Principal Residence Those dollar limits are fixed in the statute and not adjusted for inflation.
Taxable gain isn’t just the sale price minus what you paid. Add the cost of capital improvements over the years, like a new roof, a kitchen remodel, or an added bathroom, to your original purchase price. That gives you your adjusted cost basis. Then subtract selling expenses, including commission, advertising, legal fees, and transfer taxes, from the sale price to get the amount realized.9Internal Revenue Service. Publication 523, Selling Your Home The difference between the amount realized and the adjusted basis is your gain. Routine maintenance like painting and patching doesn’t count as an improvement, though repairs done as part of a larger renovation can.
If your gain exceeds the exclusion, the excess is taxed at long-term capital gains rates. For 2026, single filers with taxable income up to $49,450 and married couples up to $98,900 pay 0% on long-term gains. The 15% rate applies to most people above those thresholds, and the 20% rate kicks in for single filers above $545,500 and married couples above $613,700. On top of that, a 3.8% net investment income tax applies to the non-excluded portion of your gain if your modified adjusted gross income exceeds $200,000 single or $250,000 married filing jointly.10Internal Revenue Service. Questions and Answers on the Net Investment Income Tax Those NIIT thresholds are also not indexed for inflation, so more sellers cross them each year.
If the sale qualifies for the full exclusion and the price is $250,000 or less ($500,000 for married sellers), the closing agent generally won’t issue a Form 1099-S, provided you sign a certification confirming the exclusion applies.11Internal Revenue Service. Instructions for Form 1099-S – Proceeds From Real Estate Transactions For higher-priced sales, expect a 1099-S even when the gain is fully excludable, and report the transaction on your return. Foreign sellers face a separate 15% withholding under FIRPTA, regardless of what they’ll ultimately owe in tax.12Internal Revenue Service. FIRPTA Withholding
If the Home Doesn’t Sell
If the listing period expires without a sale, you can walk away without owing commission. You’re free to relist with the same agent on new terms, switch to a different agent, or take the home off the market. Before anything, check the protection clause in your expired agreement. If a buyer who toured the home during the listing period comes back within the protection window and buys, your original agent may still be owed a commission.
If you plan to relist with a new agent, diagnose what went wrong first. The two usual culprits are price and condition. Showings but no offers usually means the price was off. No showings at all points to marketing or first impressions. A new agent brings fresh eyes, but no agent can fix a fundamental pricing problem if you’re not willing to adjust.