How Much Are Closing Costs in California? A Seller’s Breakdown

Selling your California home should be exciting, but closing costs can take a significant bite out of your profits. These fees often surprise many homeowners at the final check, creating unexpected financial stress.

At Osborne Homes, we’ve helped thousands of California sellers avoid these surprises entirely. With over 15 years of experience and 3,000+ transactions completed, we buy any homes in any situation throughout California. In this article, we’ll explain what closing costs include and how you can avoid them completely by selling as-is to Osborne Homes.

What Are Closing Costs in California?

Closing costs in California for sellers typically range from 8% to 10% of the home’s sale price, while the actual closing costs (excluding agent commissions) average around 2.70% of the home’s purchase price. Many sellers focus solely on their home’s sale price, only to be surprised when their actual take-home amount is much lower after closing costs are deducted.

For perspective, with California’s median home value of $769,405, sellers may pay $62,000 to $77,000 in total closing costs. The difference between expecting $500,000 and walking away with significantly less can seriously impact your plans for your next home or other financial goals. The largest portion typically comes from real estate agent commissions, which average 5.18% in California.

Use our California closing cost calculator to estimate your specific costs.

California Closing Costs Breakdown

Closing costs in California can significantly impact your final profit. Below, we break down the most common seller-side fees so you know what to expect and where you might be able to save.

Real Estate Agent Commission

Real estate commission is typically the largest closing cost for California home sellers. According to the 2025 average real estate commission report, the current rate in California is 5.18%, usually split between the listing and buyer’s agents, though this rate is negotiable. You may have more room to negotiate in competitive markets or if you expect a fast sale.

Following the 2024 NAR settlement, buyer’s agents must now negotiate their fees directly with buyers before a contract is signed. This shift could reduce the seller’s obligation to cover the buyer’s agent commission, depending on how negotiations play out. Some sellers are also turning to discount brokerages or flat-fee realtors as lower-cost listing options.

Escrow Fees

Escrow companies in California oversee the closing process by collecting funds, handling paperwork, and ensuring both parties meet contractual obligations. Fees vary based on the sale price and escrow provider, but are often split 50/50 between buyer and seller.

Title Insurance & Search

Title insurance protects the buyer from future claims against the property, while a title search ensures there are no existing liens or ownership issues. In California, sellers typically pay for the owner’s title insurance, with costs typically ranging from 0.5% to 1.0% of the home’s sale price.

Transfer Tax

California charges a documentary transfer tax based on the property’s sale price. Most counties charge $1.10 per $1,000 (or 0.11%). However, some cities impose additional local transfer taxes, which can significantly increase your final cost. For example, Los Angeles has a tiered system, with transfer tax rates increasing for properties above certain thresholds.

Property Taxes (Prorated)

Sellers are responsible for property taxes up to the closing date. California local governments levy property taxes on property owners, with a typical property tax rate of 1.1%. The exact amount owed will depend on your closing date and whether any taxes have been prepaid.

Natural Hazard Disclosure

Under California Civil Code 1103, sellers must provide a Natural Hazard Disclosure (NHD) report for most home sales. This report outlines risks such as floods, wildfires, or earthquake zones that affect the property. The report typically costs home sellers $50 to $150, depending on the length and provider, with standard residential reports ranging from around $70 to $100.

HOA Fees (If Applicable)

If your home is in a homeowners association, you’ll face several HOA-related costs at closing. These costs only apply to properties governed by an HOA and can include transfer fees, prorated dues, and document preparation fees. HOA transfer fees generally range from $100 to $500, with most falling in the $200-$250 range, though HOA disclosure fees can cost $200 to $600 depending on the complexity of the documents required.

Optional Costs

Additional costs that can increase your total include home warranties, pre-sale inspections, staging services, and various repairs or improvements. While optional, these can add to your closing costs.

4 Ways to Save on Closing Costs: Seller Tips

Don’t let closing costs eat into your hard-earned equity. These four strategies can help you reduce expenses and keep more money in your pocket when selling your California home.

1. Negotiate Agent Commissions

Standard commissions aren’t set in stone. If you’re selling in a hot neighborhood or expect a quick sale, you may have room to negotiate your listing agent’s commission rate. Every percentage point saved on a $500,000 home keeps $5,000 in your pocket.

Some sellers explore discount brokerages or flat-fee services, though these often provide more limited services than full-service agents.

2. Compare Escrow and Title Services

Not all title and escrow companies charge identical fees. Take time to compare rates from several providers; you might save hundreds or even thousands on a high-value property. Request written quotes and fee schedules before committing.

Remember that in California, buyers and sellers can negotiate who pays for which closing costs, sometimes splitting certain expenses.

3. Avoid Unnecessary Extras

Be selective about optional services that add to your closing costs:

• Pre-listing inspections
• Extensive staging services
• Cosmetic repairs with minimal ROI
• Extended home warranties

Focus your investments on repairs and improvements that genuinely increase your property value or address issues that would derail a traditional sale.

4. Consider Selling As-Is to Reduce Costs

For many California homeowners, selling as-is to a direct buyer eliminates most traditional closing costs entirely. This approach removes:

• Agent commissions (typically 5-6% of sale price)
• Staging and prep costs
• Repair negotiations or credits
• Multiple closing fees and complications

Selling a house in California as-is works particularly well for inherited properties, homes needing substantial repairs, or situations where time and convenience matter more than maximizing the final sale price. Direct buyers typically handle the simplified closing process and cover most associated costs.

Note: You’ll still be responsible for property tax and county transfer tax, but these minimal costs pale in comparison to traditional sale expenses. While direct buyers typically pay around 80% of market value, sellers often net similar amounts after factoring in eliminated commissions, repairs, and closing costs.

Avoid Closing Costs by Selling to Osborne Homes

Want to avoid thousands in closing costs and skip the headaches of a traditional home sale? Osborne Homes buys California properties as-is with our proven 3-step process that delivers speed, simplicity and certainty. With 15+ years of experience and 3,000+ successful transactions, we handle any homes in any situation throughout California.

Our simple process: Contact Us for a no-obligation consultation, we’ll complete a Home Assessment, then Close & Get Paid in Cash on your timeline. No commissions, no repairs, no surprises – just a guaranteed sale with complete transparency.

Sell Your House Fast

FAQs: California Closing Cost Questions

Here are answers to the most common questions California sellers have about closing costs.

What is the Formula for Calculating Closing Costs?

Simple Formula: Real Estate Commission (Home Value × 5.18%) + Other Closing Costs = Total Closing Costs. 

Seller closing costs in California vary significantly based on your specific situation, property value, and negotiations. The largest cost is typically real estate commissions, but many other fees contribute to your total costs. Learning how to calculate closing costs in California helps you budget properly for your sale.

Can You Negotiate Closing Costs?

Yes! Almost every closing cost is negotiable to some degree. Commission rates, title insurance premiums, and escrow fees can often be reduced through negotiation. In seller’s markets, you may even convince buyers to cover some costs typically paid by sellers.

What is the Rule of Thumb for Calculating Closing Costs?

California real estate professionals typically advise sellers to budget for various selling costs, including both closing costs and agent commissions. The exact amount depends on your specific situation, property value, and local market conditions.

Are Closing Costs Tax-Deductible?

Some selling expenses may be tax-deductible, particularly those related to preparing your home for sale or marketing expenses. However, most closing costs are considered part of your home’s cost basis rather than deductible expenses. Consult with a tax professional for guidance specific to your situation.

Can I Avoid Any of These Costs When Selling As-Is?

Absolutely! When selling directly to Osborne Homes, you avoid ALL closing costs except the legally required property tax and transfer tax (which are minimal). You won’t pay any escrow fees, title insurance, commissions or repair costs.