Weighing the True Cost of Keeping vs Selling Your Home
As a homeowner, deciding whether to keep or sell your home can be a daunting task. Understanding the true costs of homeownership is important to making an informed decision. With the right calculations, you can determine if selling your home is the better option for your financial situation. Consider the example of a $500,000 home with a $300,000 mortgage balance
Based on federal consumer protection law and HUD/CFPB public guidance · Last reviewed July 2026
The Direct Answer
To calculate the true cost of keeping your home, you need to consider all the expenses associated with homeownership, including your mortgage, property taxes, insurance, maintenance, and repairs. A good rule of thumb is to budget at least 1% of the home's value annually for maintenance and repairs.
For example, if your home is worth $500,000, you should budget at least $5,000 per year for maintenance and repairs. Additionally, you'll need to consider your mortgage payments, property taxes, and insurance costs to get a complete picture of the costs of keeping your home.
Do not forget to factor in the potential costs of selling your home, including real estate agent commissions, closing costs, and any outstanding mortgage balance or liens on the property.
Calculating the Costs of Keeping Your Home
Mortgage Payments
Your monthly mortgage payment is likely one of the largest expenses associated with keeping your home. To calculate this cost, you'll need to know your outstanding mortgage balance, interest rate, and loan term. You can use a mortgage calculator to determine your monthly payment amount.
For example, if you have a $300,000 mortgage balance with an interest rate of 4% and a loan term of 30 years, your monthly mortgage payment would be approximately $1,432.
Calculating the Costs of Selling Your Home
Real Estate Agent Commissions
When you sell your home, you'll need to pay a real estate agent commission, which is typically a percentage of the sale price. The average real estate agent commission is around 5-6% of the sale price, although this can vary depending on the agent and the location.
For example, if you sell your home for $500,000, you could pay around $25,000 to $30,000 in real estate agent commissions.
Comparing the Costs of Keeping vs Selling
Once you've calculated the costs of keeping and selling your home, you can compare the two options to determine which is the better choice for your financial situation. Consider factors such as your current financial situation, your long-term goals, and the potential return on investment for each option.
For example, if you're facing financial difficulties and are struggling to make your mortgage payments, selling your home may be the better option. On the other hand, if you're in a stable financial situation and plan to stay in your home for the long term, keeping your home may be the better choice.
Next Steps
Now that you've calculated the true cost of keeping vs selling your home, it's time to consider your next steps. If you've decided to sell your home, you'll need to start the process of preparing your home for sale and finding a real estate agent. If you've decided to keep your home, you may want to consider ways to reduce your expenses, such as refinancing your mortgage or reducing your energy consumption.
Additional Resources
If you're still unsure about what to do, consider consulting with a financial advisor or a housing counselor. They can help you review your financial situation and provide guidance on the best course of action. You can find a list of approved housing counselors on the Department of Housing and Urban Development (HUD) website.
Get a Free Home Valuation
Get an accurate estimate of your home's value to help you make a more informed decision about whether to keep or sell. Contact a real estate agent or a housing counselor for a free home valuation.
How do I calculate the true cost of keeping my home?
To calculate the true cost of keeping your home, you need to consider all the expenses associated with homeownership, including your mortgage, property taxes, insurance, maintenance, and repairs. You can use a mortgage calculator to determine your monthly mortgage payment, and you should also budget at least 1% of the home's value annually for maintenance and repairs.
What are the costs of selling my home?
The costs of selling your home include real estate agent commissions, closing costs, and any outstanding mortgage balance or liens on the property. The average real estate agent commission is around 5-6% of the sale price, although this can vary depending on the agent and the location.
How do I determine if keeping or selling my home is the better option?
To determine if keeping or selling your home is the better option, you need to consider your current financial situation, your long-term goals, and the potential return on investment for each option. You should also consider factors such as the potential costs of selling your home, including real estate agent commissions and closing costs.
Where can I find additional resources to help me make a decision?
You can find additional resources to help you make a decision by consulting with a financial advisor or a housing counselor. They can help you review your financial situation and provide guidance on the best course of action. You can also find a list of approved housing counselors on the Department of Housing and Urban Development (HUD) website.