Net Sales Price
The definition of net sales price in real estate is the combined total cost to the buyer of a listing, excluding any auxiliary costs such as the sales fee, appraisal fee, real estate agent commission and any other supplementary costs. Net sales price differs from gross sales price in several regards in that gross sales price includes all supplementary costs, while net sales price only includes the cost paid by the buyer.
So how is net sales price calculated, and what is and is not counted while calculating it? In the following section, we’ll provide some examples of how net sales price is used as a term in real estate, and how it is calculated. Let’s begin.
Example of net sales price in real estate
Harold is a junior partner at a well established law firm. A skilled defense lawyer, Harold, or Harry as his friends call him, is as cunning as he is unscrupulous. With a bustling clientele that includes many distasteful individuals, he has amassed a small fortune and is in the market to sell his home. He finds a real estate agent and begins the process of selling his current domicile.
After some searching, Harold manages to find a buyer for his current home, a beautiful two story cape-cod style home in a quiet suburb adjacent to the city. After completing the preliminary paperwork, Harold proceeds to calculate how much he’ll receive after the sale of his home. However, misfortune befalls him.
In a twist of irony, it turns out that the real estate agency Harold chose to sell his home is as disingenuous as he is. After applying a myriad of hidden fees and costs in addition to the universal fees that must be paid after the sale of a home, Harold records a net sales price far lower than he believed he would when he began the process of selling his home.
Popular Real Estate Terms
generic name of the form used to file taxes payable to a federal, state, or local government. The tax return includes items such as gross income, deductions, tax credits, and tax due. ...
The rate at which a market can absorb additional units of supply without causing market saturation and severe price distortions. For example, during a recessionary period, many homeowners ...
(1) Method of measurement lumber using the board foot cubic measure. The board measure is used to estimate quantities and prices of lumber materials. (2) Method of estimating lumber ...
See ordinary annuity. ...
The meaning of direct costs implies such expenses that you can connect straight to a particular goods’ or service’s production, manufacturing, and preparation. As opposed to ...
Same as term graduated lease: A rental stipulation a varying rental rate. Rental rate are determined tied to periodic appraisals or an inflation or an inflation index. The provision is more ...
As a collective noun, land cost means the total cost of purchasing a parcel of land or lot with specific land use and ownership. The land cost includes the purchase price, closing costs, ...
Amount paid to a person or business for bringing the parties together in a business arrangement. The finder may also act in a consulting capacity. The fee may be a flat amount or rate, a ...
Maybe you’re studying for your real estate exam, or you heard the word from your real estate agent and didn’t know what it means. Whichever your reason, we’ll go ahead and ...
Have a question or comment?
We're here to help.