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Hidden Selling Costs That Eat Your Profit
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Don’t Forget the Exit Costs

Most new investors obsess over acquisition numbers. They sharpen their pencils, run the comps twice, double-check the rehab budget, calculate holding costs, and feel like mathematical heroes when the spreadsheet turns green.
And then—they forget the final punch in the ribs waiting at the closing table:
Exit costs.
They’re the silent killers of ROI, the financial equivalent of missing the last stair in the dark. You think you’re on stable footing… until you’re not.
What Are Exit Costs?
Exit costs are everything you pay when you sell the property:
Real estate agent commissions
Seller-paid closing costs
Title fees and transfer taxes
Attorney fees
Loan payoff fees
Prorations
Required repairs or concessions
Staging or last-minute touch-ups
Home warranty (if offered)
The mysterious “miscellaneous” line items no one explains convincingly
Real Estate taxes (this is the one I forgot about most often in the early years)
Investors often ignore these until it’s too late because exit costs feel less immediate than rehabbing a sagging kitchen floor.
Why Investors Miss This Stuff
Because once the rehab is done, they feel done.
But selling has its own economics.
If your flip shows $25,000 of projected profit but you forgot about $18,000 of exit costs, congratulations—you’ve just earned $7,000 for six months of sweat, stress, and discovering which walls were load-bearing after all.
As Ben Franklin put it:
“Beware of little expenses; a small leak will sink a great ship.”
Or as my Uncle Jerry used to say:
“Puppies become dogs.”
Exit costs are small leaks with sharp teeth.
How to Estimate Exit Costs Quickly
You don’t need a specialist or a protractor. Just assume:
8–10% of ARV disappears at closing.
Roughly:
5–6% commissions
1–2% closing fees
1–2% miscellaneous
Build this in from day one and you won’t get blindsided.
One More Thing Professionals Should Know
Several states now require brokers to provide a net-to-seller closing disclosure—a handy document showing exactly what the seller will walk away with.
It’s great for homeowners.
But for you?
That disclosure should never be a surprise.
It should simply confirm what you already accounted for.
True professionals never discover their net profit at the closing table.
They knew it before they ever signed the listing agreement.
The Smart Investor’s Move
Always ask:
“What will it cost me to get out of this deal?”
New investors think about buying.
Experienced investors think about buying and selling.
Seasoned professionals think about both at the same time.
Account for the exit.
Protect your ROI.
And let the amateurs learn about exit costs the painful way.
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