Average Closing Costs, Excluding Taxes, Up By 10.5 Percent Year-Over-Year
ClosingCorp, a provider of residential real estate closing cost data and technology for the mortgage and real estate services industries, released its most recent closing cost data, which showed that in the first half of 2021 national average closing costs for a single-family property were $6,837 including taxes, and $3,836 excluding taxes. These were 12.3% and 10.5% year-over-year increases, respectively; whereas refinance closings costs increased marginally to $2,398, a 4.87% change from the reported 2020 average of $2,287.
ClosingCorp cost calculations include lender’s title policy, owner’s title policy, appraisal, settlement, recording fees, land surveys and transfer tax. ClosingCorp uses home price data from CoreLogic to estimate closing costs for an average home at the state, core-based statistical area (CBSA) and county levels. ClosingCorp uses ranges, rather than single values, to more accurately capture fees associated with the real transactions.
Dori Daganhardt, chief data officer of ClosingCorp, said: “To get a better overall picture of what is actually going on in a market, we analyzed data on more than 1.9 million single-family purchase transactions that ran through our ClosingCorp Fees platform in the first half of this year. We are reporting ‘market-specific’ rates and fees not just network averages charged by the most active settlement services providers in each geographic area.”
Commenting on what this means to consumers, Bob Jennings, chief executive officer of ClosingCorp, said: “In the first half of 2021, buyers faced significantly higher home prices; in June, for example, the average national price hit a new high of $373,664, and in July leading home price indices registered their highest ever year-over-year gains. Although the average home price increased by nearly $45,000, the closing costs, excluding taxes, on that property only increased by $400. In fact, closing costs as a percentage of purchase prices declined this year, going from 1.06% of the transaction in 2020 down to 1.03%. So, in addition to keeping up with high demand, the mortgage industry is doing a good job in holding down the costs it can control.”
The 2021 report shows the states with the highest average closing costs, including taxes, were: District of Columbia ($30,352), Delaware ($17,831), New York ($17,582), Washington ($13,909), and Maryland ($12,056). The states with the lowest closing costs, including taxes, were: Missouri ($2,102), Indiana ($2,193), North Dakota ($2,321), Kentucky ($2,355) and Wyoming ($2,509).
The states with the highest average closing costs, excluding taxes, were: District of Columbia ($6,523), New York ($6,300), Hawaii ($5,976), California ($5,772), and Washington ($4,803). The states with the lowest closing costs, excluding taxes, were: Arkansas ($2,071), Missouri ($2,102), Indiana ($2,193), Nebraska ($2,193) and Kentucky ($2,193).
The half year 2021 purchase and refinance closing costs reports are now available. For more information, please visit: closing.com/closingcosttrends.
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