How much money do you lose selling a house is not one national percentage. On a $250,000 Michigan sale, a 5.5% commission plus state and county transfer tax comes to $15,900 before the mortgage payoff. That leaves $234,100 of the price, and only if no other seller charge is added.
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The loss people mean is usually the gap between the price on the purchase agreement and the check at closing. Commission and transfer tax are the two pieces you can estimate from the price alone. A full list of other selling costs lives on the Michigan home selling cost guide. This page walks one example only.
How Much Money Do You Lose Selling a House in One Example
Start with the contract price. Subtract a commission if you pay one. Then subtract the transfer tax the county collects when the deed is recorded. What remains is not your final check. It is the amount left before the lender payoff and any other charge tied to that house.
Use $250,000 because it is easy to scale. A 5.5% commission is $13,750. Michigan’s state real estate transfer tax is $3.75 for each $500 of value, which is $1,875. In a county that charges 55 cents per $500, the county tax is $275. Together those three lines are $15,900, or 6.36% of the price.
| Line. | How it is figured. | Amount. |
|---|---|---|
| Contract price. | The example sale price. | $250,000. |
| Commission. | 5.5% of $250,000. | $13,750. |
| State transfer tax. | $3.75 for each $500 of value. | $1,875. |
| County transfer tax. | $0.55 for each $500 of value. | $275. |
| Left before payoff. | Price minus the three lines above. | $234,100. |
Change the commission and the loss changes with it. At 5% the commission is $12,500 and the same taxes still total $2,150, so $14,650 comes off the price. At 6% the commission is $15,000 and the three lines total $17,150. The tax lines do not move when the commission does.
A fraction of $500 still counts as a full $500. On a price of $250,100, the state tax uses 501 increments, not 500. That is $3.75 more than the even $250,000 figure. Round up before you treat the worksheet as final.
What the Michigan Transfer Tax Adds
The state rate is set by statute, not by the listing. MCL 207.525 levies $3.75 for each $500, or fraction of $500, of the total value transferred. The Michigan Department of Treasury says the seller or grantor is responsible for that state tax. It is paid through the county when the deed is recorded.
County tax is a separate charge. MCL 207.504 sets it at 55 cents per $500 in a county with a population under 2,000,000. Wayne County’s Register of Deeds states the same split in plain numbers: county tax of $0.55 per $500 and state tax of $3.75 per $500. Macomb County publishes the matching formula, sale price times 0.0075 for the state share and times 0.0011 for the county share.
On $250,000 that is $1,875 to the state and $275 to the county, or $2,150 combined. On $300,000 it is $2,250 and $330, or $2,580. Oakland, Wayne, and Macomb are each under 2 million people, so the 55-cent county rate is the one that applies in those three counties. A county of 2 million or more can go as high as 75 cents per $500. None of the three Metro Detroit counties is in that group.
Some transfers are exempt, and a buyer can pay the tax on the seller’s behalf. Do not assume either one. Read the deed and the settlement statement. If a line is missing, ask the title company which party is writing the check.
Why the Price Is Not the Check
The $234,100 figure answers a narrow question. It is what remains after one commission and the two transfer taxes. It is not cash in hand. The lender is paid from that remainder if a mortgage is still on the house. A tax proration, an association charge, or a lien can come out of the same pot. None of those amounts can be guessed from the sale price.
That is why two sellers with the same price can leave with very different checks. One may owe little on the loan. The other may owe nearly the whole price. The commission and transfer tax in the table stay the same. The payoff does not. Ask the lender for a current payoff, then subtract it after the lines above.
Repairs, staging, and months of holding costs are a different question. They depend on the house and on how long it sits. They are not in this example. If you need those ranges, use the cost guide rather than stretching this worksheet.
A cash sale can change which of these lines you pay. It does not change the math of a line you still owe. If a written offer says the buyer pays the commission or the transfer tax, that line comes off your loss. If it does not, leave the line in. Who pays which cash-sale charge is covered in the Michigan cash-buyer closing cost guide.
How to Run Your Own Number
You can rebuild the table with your price in four steps. Keep the result labeled as “before payoff” until a title company gives you the rest.
- Write down the contract price, not a hoped-for list price.
- Multiply that price by the commission rate in your listing or buyer agreement. If there is no commission, use zero.
- Divide the price by 500 and round up to the next whole number. Multiply by $3.75 for the state tax and by $0.55 for the county tax in Oakland, Wayne, or Macomb.
- Subtract those amounts from the price. Then subtract the mortgage payoff and any other charge the title company lists.
Here is the same method at $300,000 with a 6% commission. Commission is $18,000. State tax is $2,250. County tax is $330. The three lines total $20,580, and $279,420 is left before payoff. The tax share is still $2,580. Only the commission moved.
If you are comparing a direct sale with a listed sale, put the same price on both sides and change only the lines the written offer removes. A lower offer price can still leave more after commission if that commission is zero. The only way to see it is to finish step 4 for both paths. For a Metro Detroit cash offer, start at the Michigan cash sale page and ask for the net in writing.
What This Example Does Not Decide
This worksheet does not say what a buyer will pay for a specific house. It also does not estimate capital gains tax. A principal residence, a rental, and an inherited house can be taxed differently, and that question belongs with a tax adviser and the closing documents.
It does not list staging, repair bills, title insurance, attorney fees, or monthly holding costs. Those belong on the cost page. It does not explain probate or an after-death sale. And it does not tell you whether a cash offer is higher or lower than a listed price. It only shows how commission and Michigan transfer tax reduce one stated price.
Bring the table to the title company and ask them to replace every example line with the figure from your file. If a line in your contract is different from 5.5% or from the 55-cent county rate, their number wins.
Scale the Same Three Lines
Once the method is clear, the useful next step is to see how the loss moves when only the price changes. Keep the commission at 5.5% and keep the county rate at 55 cents per $500. The tax is a fixed share of price. The commission is too, at a fixed rate. The dollar loss still grows because both are tied to a larger number.
At $150,000, a 5.5% commission is $8,250. State tax is $1,125. County tax is $165. The three lines total $9,540, which is the same 6.36% as the $250,000 case. Left before payoff: $140,460. A smaller price does not create a smaller percentage. It creates a smaller dollar gap that can still matter if the loan balance is high.
At $200,000, commission is $11,000. State tax is $1,500. County tax is $220. The three lines total $12,720, and $187,280 is left before payoff. At $400,000, commission is $22,000. State tax is $3,000. County tax is $440. The three lines total $25,440, and $374,560 is left before payoff. Each of these is an even $500 price, so no rounding step was needed.
Now change only the commission, using the $250,000 price again. At 4%, commission is $10,000 and the taxes stay $2,150, so $12,150 comes off and $237,850 remains before payoff. At 5%, $14,650 comes off. At 6%, $17,150 comes off. A one-point commission change on this price is $2,500. The transfer tax does not absorb that point. It sits on its own line.
Sellers sometimes fold the tax into a vague “about 8 to 10 percent” and stop. That range can be true once repairs and holding time are added, but it hides the part you can compute tonight. On this worksheet the known part is 6.36% at a 5.5% commission. At a 6% commission the same taxes push it to 6.86%, or $17,150. Label every other cost as unknown until the title company prices it.
A second trap is using the list price. If you later accept $240,000 on a $250,000 list price, redo the table. Commission at 5.5% becomes $13,200. The price is an even multiple of $500, so state tax is $1,800 and county tax is $264. The three lines are $15,264, and $224,736 is left before payoff. Using the old $234,100 figure would overstate the remainder by $9,364. Most of that gap is the lower price. The rest is the lower commission and tax.
Write the four lines on paper before you compare offers: price, commission, state tax, and county tax. Then leave a fifth blank line for the payoff. If one offer removes the commission, put zero there and do not also invent a higher net somewhere else. If an offer is $15,000 lower and commission-free, run both sheets. The lower price can still leave more before payoff. It can also leave less once the loan is subtracted. You will not know which until both sheets are finished.
Keep the sheet next to the purchase agreement, not in place of it. The agreement controls the commission and any credit. The statute controls the state rate. The county rate here is the 55-cent rate for Oakland, Wayne, and Macomb. Your file controls the payoff. The sheet only makes those three sources visible in one place.
If a concession changes the price, rerun the sheet on the reduced price. A $5,000 seller credit on a $250,000 contract is a new price for your own estimate only if the deed value changes. Ask the title company which figure the transfer tax uses. Then apply the commission rate to the figure in your agreement. Do not subtract the credit twice.
Round only at the $500 step, and only upward. A price of $250,001 uses the same 501 increments as $250,100. The state line becomes $1,878.75 and the county line becomes $275.55. The extra is small. Leaving it off still makes the worksheet look more exact than the statute allows.
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Frequently Asked Questions
How much money do you lose selling a house at $250,000 in Michigan?
In this example, a 5.5% commission is $13,750 and state plus county transfer tax is $2,150. That is $15,900 off the price, leaving $234,100 before the mortgage payoff and any other seller charge.
Does the county tax change between Oakland, Wayne, and Macomb?
No. Each of those counties is under 2 million people, so the county rate in MCL 207.504 is 55 cents per $500. Wayne County and Macomb County both publish that county share alongside the $3.75 state share.
Is the amount left after commission the check I receive?
No. Subtract the lender payoff and any proration, lien, or association charge the title company lists. Two houses at the same price can produce very different checks.
Can the buyer pay the Michigan transfer tax?
Yes. The seller or grantor is legally responsible, and the tax can still be paid by the buyer on the seller’s behalf. Look at the purchase agreement and the settlement statement rather than assuming it.