The Number on the Contract Is Not the Number in Your Account
Most sellers know their sale price. Fewer have worked out what's left after the mortgage payoff, commission, concessions, and closing costs. The gap between those two numbers is where sellers get surprised, and it's easy to calculate before you ever list.
Here is a full walk-through using a realistic Austin example.
A Worked Example
These are illustrative figures for a $450,000 sale with a $280,000 mortgage payoff and a closing in early October. Your numbers will differ, and a written net sheet for your own home is the only reliable version.
Sale price: $450,000
Mortgage payoff: -$280,000
Agent compensation (illustrative 5% total): -$22,500
Seller concession toward buyer's costs: -$6,000
Property tax proration (seller's share): -$6,060
Owner's title policy: -$2,800
Repair credit after inspection: -$3,000
Home warranty offered to buyer: -$600
HOA resale certificate and transfer fees: -$400
Escrow and settlement fees: -$500
Recording and miscellaneous: -$300
Total costs, excluding payoff: $42,160
Estimated net proceeds: about $127,840
Those selling costs equal roughly 9 percent of the sale price. About $6,000 of that is property tax you would owe regardless, so the true cost of selling in this example is closer to 8 percent. A rough planning range of 7 to 10 percent is realistic once everything is counted.
Line by Line
Mortgage payoff. The balance on your loan plus interest accrued through closing. Ask your lender for a payoff statement rather than relying on your last statement balance.
Agent compensation. Compensation is negotiable and set by agreement. Since the 2024 industry settlement, buyer-agent compensation is no longer advertised on the MLS, so how it's handled is something to discuss before you list. Every 1 percent on a $450,000 home is $4,500, which makes this the line most worth understanding.
Seller concessions. In a market with homes averaging well over 80 days on market, buyers commonly ask for help with closing costs or a rate buydown. Concessions reduce your net dollar for dollar, so decide in advance how much you're willing to give.
Property tax proration. Texas property taxes are paid in arrears, so at closing you credit the buyer for the portion of the year you owned the home. For a home taxed around $8,100 per year, a closing in early October means you cover roughly 273 days of that bill.
Owner's title policy. In the Austin area, the seller customarily pays for the owner's title policy. Texas regulates the premium, and on a home this price it often runs in the range of $2,500 to $3,000.
Repair credits. Inspection requests are common. Budgeting a realistic amount keeps a negotiation from surprising your net.
HOA and miscellaneous fees. If your home is in an HOA, you typically pay for the resale certificate and transfer fees. Settlement, escrow, and recording fees are smaller but real.
What Texas Does and Doesn't Charge You
Texas has no state income tax, and there's no state transfer tax on a home sale, which keeps this list shorter than in many states.
Federal capital gains are a separate matter. If the home was your primary residence for at least two of the last five years, a significant portion of your gain is typically excluded, up to $250,000 for a single filer and $500,000 for a married couple filing jointly. Whether you owe tax depends on your purchase price, improvements, and holding period, so confirm with a tax professional.
How Price Changes Move Your Net
A price reduction doesn't cost you dollar for dollar in lost proceeds, but it comes close. At a 5 percent compensation rate, cutting your price by $10,000 reduces your net by about $9,500. That's why pricing correctly from the start matters. A home that sits and takes several reductions often nets less than one priced accurately on day one, because of the accumulated cuts and the extra months of carrying costs.
What Else Reduces Your Real Take-Home
The net sheet covers closing, but your actual position also includes the cost of carrying the home while it's listed (mortgage, taxes, insurance, utilities), moving costs, any repairs and prep you do before listing, and what you plan to spend on your next home. If you're buying again, your net proceeds drive your next down payment, so the accuracy of this estimate affects your whole plan.
How I Approach It
Before you list, I prepare a net sheet at several price points, so you can see how your proceeds change at your target price and at a more conservative one. I build in realistic concessions and repair credits instead of assuming a perfect sale, and I update the estimate as offers come in, so you can compare offers on what you'd net, not just the headline price.
That last point matters. A higher offer with a large concession request can net you less than a lower, cleaner offer.
Common Mistakes
Sellers assume the contract price is what they'll receive. They forget the property tax proration, which can be several thousand dollars. They budget nothing for concessions or repair credits in a market where both are common. And they compare offers by price alone, instead of by net.
FAQ: Net Proceeds When Selling
Q: What percentage of the sale price do sellers usually lose to closing costs?
A: A rough planning range is 7 to 10 percent, depending on compensation, concessions, and prorations. A written net sheet gives your specific number.
Q: Do I pay a transfer tax when I sell in Texas?
A: No. Texas has no state transfer tax on home sales.
Q: Who pays for the title policy in Austin?
A: The seller customarily pays for the owner's title policy, though this can be negotiated in the contract.
Q: Is agent compensation fixed?
A: No. It's negotiable and set by agreement between you and your agent.
Q: Will I owe capital gains tax?
A: It depends. Many homeowners qualify for a substantial exclusion on a primary residence, but your purchase price, improvements, and holding period matter. Confirm with a tax professional.
Q: When do I actually receive my money?
A: Typically on the day of funding, once the sale closes and records, usually by wire.
Knowing your net before you list lets you price with confidence, evaluate offers on what they actually put in your pocket, and plan your next move with real numbers. I prepare a written net sheet for every seller before listing, with scenarios at multiple price points.
If you're thinking of selling, let's calculate what you'd actually walk away with.
(512) 217-3961
[email protected]
— Maria Aguirre
Mi Casa Agency | Keller Williams Lake Travis
