Illustration of house with closing costs totals.

5 Fees and Costs to be Aware of When Buying a House.

by Greg Stidham, REALTOR®

Purchasing a home is possibly one of the biggest financial decisions you will make in your lifetime. As you start your hunt, don’t forget there will be other costs associated with your purchase that many buyers don’t notice until they are in escrow.

Here are 5 fees and costs to keep in mind as you begin to budget.

1) Title services.

Title services encompass the transfer of the title from the seller and a thorough search of the property’s records to help ensure that no one else will show up with a claim to the property. Who pays the escrow fee and closing costs can vary with each transaction and are often negotiated for a better purchase offer. Additionally, you may be required to buy title insurance which will protect the lender if you are getting a loan. An owner’s policy may also need to be purchased to protect YOU, the new owner.

Closing costs could become pricey, even if you share them with the seller.

Closing costs can range anywhere from $2000 and up. Closing costs are often based on the value of the home so make sure to budget for them before you submit the offer.

2) Home inspections.

This is a crucial step in the home buying process. I recommend you always inspect the home you are buying.

The findings that come during the inspection process can help you negotiate price and repairs. Generally, you can expect to pay between $300 to $500 depending on the size and construction of the home. Other inspections that may be needed include: sewer lateral, chimney, and an arborist for trees. If you need all four of these, the cost could be between $900 – $1500 for all.

Inspections are good. Make sure to budget for them.

3) Appraisal fee.

Before getting a loan, you will likely be required to get an appraisal of the home to determine its estimated market value. Some lenders cover this fee while others ask the buyer to pay it. The appraisal will be conducted by a third-party company and the cost can be anywhere between $300 and $1,000, depending on the size of the home.

4) HOA fees and dues.

If you are searching for a condo or townhouse, you probably want to budget for HOA dues. Some detached home communities may also have HOA dues.

Normally, these dues are monthly and you will need to budget long term as well. These dues are used for general maintenance and updates to areas like pools, parks, and more. Typical HOA fees range between $200 and $600 in my market.

In escrow, there may also be one-time HOA fees.

These fees are often negotiated in the purchase contract. Sellers might agree to pay some of these fees, but you, the buyer, may need to pay some of them. Make sure to budget between $200 – $1000 for your share of these fees in escrow.

5) Taxes.

The taxes each buyer pays at the closing table differ, but it is not uncommon for it to be up to two months’, or more, of prorated taxes. Additionally, there may be taxes for the transfer of the home title. Who pays the transfer tax is also a negotiable item in most purchase contracts. I recommend buyers budget an additional $500 to several thousand to cover these taxes.


Thank you for taking time to read this blog post. My goal is to help make the home buying and selling process as stress free as possible. If you are in the Northern California communities of Davis and Woodland or the greater Sacramento area, please contact me. You deserve to work with a real estate agent that cares about you and is looking out for your interests.

You can also read this blog post at Greg’s Coldwell Banker website.