By Matthew Gluck | Founder & Principal Broker, NestEdge Realty
Your home sells for $1.5 million. Congratulations.
But how much of that money actually ends up in your bank account?
For many Westchester homeowners, the answer is surprisingly different from the sale price. Between real estate commissions, transfer taxes, attorney fees, mortgage balances, and other closing adjustments, the amount you walk away with can be substantially less than you expect.
And while you can't control every expense, some of the biggest costs are absolutely worth understanding before you put your home on the market.
The Sale Price Is Not Your Profit
When homeowners think about selling, they naturally focus on one number: the price their home will command.
But there are three very different numbers to consider:
- Sale price: What the buyer agrees to pay.
- Net proceeds: What remains after selling expenses, mortgage payoff, and closing adjustments.
- Profit: Your financial gain after considering what you originally paid, improvements, and other relevant costs.
For most sellers, net proceeds are the number that matters most when planning their next move.
Let's look at two examples.
Example 1: Selling a Westchester Home for $1 Million
Imagine you sell your home in Chappaqua, Pleasantville, or Briarcliff Manor for $1 million.
Here's what a hypothetical closing statement might look like:
Item | Amount |
|---|---|
Sale price | $1,000,000 |
Total brokerage compensation (3%) | −$30,000 |
NYS transfer tax (0.4%) | −$4,000 |
Attorney fees (illustrative) | −$2,500 |
Other closing costs and adjustments (illustrative) | −$1,000 |
Mortgage payoff | −$400,000 |
Estimated net proceeds | $562,500 |
The home sold for $1 million, but the seller receives approximately $562,500 at closing.
That doesn't mean the seller lost $437,500. Most of the difference is repayment of the existing mortgage.
It does mean that planning your next purchase around the full sale price would be a serious mistake.
Example 2: Selling a Westchester Home for $1.5 Million
Now consider a higher-priced property.
Item | Amount |
|---|---|
Sale price | $1,500,000 |
Total brokerage compensation (2.5%) | −$37,500 |
NYS transfer tax (0.4%) | −$6,000 |
Attorney fees (illustrative) | −$3,000 |
Other closing costs and adjustments (illustrative) | −$1,500 |
Mortgage payoff | −$600,000 |
Estimated net proceeds | $852,000 |
In this example, the seller walks away with approximately $852,000.
The 2.5% compensation assumption illustrates a possible negotiated arrangement, not a standard or required rate. Actual compensation depends on the listing agreement and any separately negotiated buyer-side compensation.
The examples exclude potential capital-gains taxes, prepayment charges, unusual assessments, and location-specific transfer taxes.
Real Estate Commissions: One of the Biggest Controllable Expenses
Real estate brokerage compensation is negotiable. There is no legally mandated commission rate.
At NestEdge Realty, our typical listing-side compensation is 2%. If the seller also agrees to pay 1% toward the buyer's brokerage, total compensation would be 3%.
In transactions where NestEdge also procures the buyer, our total compensation may be reduced to 2.5%, depending on the agreement and transaction circumstances.
Consider the difference on a $1.5 million home:
Total brokerage compensation | Cost |
|---|---|
3% | $45,000 |
2.5% | $37,500 |
Difference | $7,500 |
That's $7,500 that could remain with the seller, assuming the same sale price and other transaction costs.
Of course, commission is only part of the equation. A lower fee isn't a bargain if poor pricing, weak marketing, or ineffective negotiations result in a lower sale price.
The goal should be to maximize your net proceeds, not simply minimize one line item.
Don't Forget New York's Transfer Tax
New York State generally imposes a real estate transfer tax of $2 for every $500 of consideration, equivalent to 0.4%.
For example:
- $750,000 sale: $3,000
- $1,000,000 sale: $4,000
- $1,500,000 sale: $6,000
- $2,000,000 sale: $8,000
The state transfer tax is generally a seller expense.
Certain municipalities impose additional transfer taxes. Yonkers, for example, has a separate local transfer tax, so sellers should verify the rules for their specific property.
And what about the mansion tax?
New York's additional 1% mansion tax applies to qualifying residential transactions of $1 million or more, but it is generally paid by the buyer. It should not automatically be deducted from a seller's estimated proceeds.
Other Expenses That Can Surprise Sellers
Attorney fees. Real estate attorneys play an important role in New York transactions, from contract negotiations through closing. Fees vary by attorney and transaction complexity.
Property tax adjustments. Depending on when you close and which taxes have already been paid, property taxes may be prorated between buyer and seller.
Mortgage payoff. Your actual payoff amount may differ from the principal balance shown on your most recent mortgage statement because of accrued interest and other charges.
Inspection negotiations. A buyer may request repairs or credits following inspections. These concessions can reduce your net proceeds.
Capital-gains taxes. Depending on your original purchase price, improvements, use of the property, and eligibility for available exclusions, selling may create income-tax consequences. Consult your tax advisor before assuming all your proceeds are tax-free.
The Most Important Question to Ask Before Listing
Before choosing a real estate broker, ask each candidate to prepare a seller's estimated net sheet.
That document should show the anticipated sale price, brokerage compensation, transfer taxes, estimated closing expenses, mortgage payoff, and projected proceeds.
More importantly, ask the broker to explain the strategy behind the projected sale price.
How will the home be positioned against competing listings? What improvements are actually worth making? How will the property be marketed? And how will offers and inspection negotiations be handled?
A strong sale isn't just about the highest number on the contract. It's about what remains after the transaction is complete.
Your Equity Deserves a Better Strategy
For many Westchester homeowners, their property represents their single largest financial asset.
Protecting that equity requires thoughtful pricing, effective marketing, experienced representation, and a clear understanding of selling expenses.
At NestEdge Realty, we believe sellers should receive full-service representation without automatically sacrificing more of their equity than necessary.
Before you list, understand your numbers.
It's your equity. Don't waste it.
Learn more about selling your Westchester home with NestEdge Realty.
Matthew Gluck is the founder and principal broker of NestEdge Realty, an independent real estate brokerage serving Westchester County and surrounding communities. The examples above are hypothetical and for educational purposes only. Actual expenses and net proceeds vary by property, municipality, negotiated agreements, and individual circumstances.