Home Selling Terms, Explained

What sellers need to know - pricing, listing, offers, contingencies, concessions and net proceeds.

Selling a home is a pricing and negotiation exercise wrapped in a legal transaction. The terms here explain how to price, what a listing agreement commits you to, how to compare offers and what you will actually walk away with.

The journey runs from deciding whether to sell through to settlement, with the decisions that most affect your net proceeds.

Start here

Listing Agreement
A listing agreement is a contract between a seller and their real estate agent, authorizing the agent to market and sell the property in exchange for a commission.
Comparative Market Analysis
A CMA is an agent-prepared report estimating a property's value by comparing it to similar recently sold, active, and pending listings in the area — commonly used to help set a listing price.
Seller Concession
A seller concession is money a seller agrees to pay toward the buyer's closing costs and prepaid items, credited at closing. It is used to reduce the buyer's cash to close without lowering the price, and matters because loan programs cap how much a seller can contribute and it can never fund the down payment.
Closing Costs
Closing costs are the fees and charges, beyond the down payment, needed to complete a real estate purchase or loan, such as lender fees, the appraisal, title insurance, settlement and recording fees, and transfer taxes. They are paid at closing and matter because they add substantial cash on top of the down payment.
Home Equity
Home equity is the portion of a property's value the owner actually owns: the difference between what the home is worth and what is still owed on every loan secured by it. It grows as the mortgage is paid down and values rise, and is tapped only by selling or borrowing.
Capital Gains
Capital gains are the profit made from selling a property for more than its purchase price plus improvements — potentially subject to capital gains tax, though many primary-residence sales qualify for an exclusion.

Selling a home, step by step

Each step changes what you net, not just the sale price.

  1. STEP 1

    Estimate what you would net

    Start from a realistic price and subtract the mortgage payoff, commissions, transfer taxes, concessions and repairs.

    Your decision: Does selling now leave enough for your next move?

    Seller net proceeds calculator →

  2. STEP 2

    Price the home

    Comparable sales, current competition and condition set a credible list price.

    Your decision: Price to attract several buyers, or test the top of the range?

  3. STEP 3

    Choose representation

    A listing agreement sets the agent's duties, term and compensation.

    Your decision: Which agent, what term and what services?

  4. STEP 4

    Prepare and disclose

    Repairs, staging and the seller's disclosure come before buyers see the home.

    Your decision: Which repairs pay for themselves, and what must be disclosed?

    Repair before selling calculator →

  5. STEP 5

    Compare offers

    Price is only one part: financing, contingencies, deposit and timing matter too.

    Your decision: Which offer is most likely to close at the best net?

  6. STEP 6

    Inspection and appraisal

    The buyer's inspection and lender's appraisal can reopen negotiation.

    Your decision: Repair, credit, or hold firm?

  7. STEP 7

    Settlement

    Payoffs, prorations and your share of costs are settled and the deed transfers.

    Your decision: Have you reviewed the settlement statement before signing?

All 41 terms

  • Appraised value is a licensed appraiser's professional opinion of what a property is worth, based on comparable sales, condition, and market data — used by lenders to confirm a loan amount is justified.

  • Appreciation is an increase in a property's value over time, driven by market conditions, inflation, local demand, or improvements made to the property.

  • An as-is sale means the seller won't make repairs or credits for any issues found during inspection — the buyer accepts the property in its current condition, though they typically can still inspect and walk away under a contingency.

  • Assessed value is a local government's estimate of a property's worth, used to calculate property taxes — often lower than market value and updated on its own schedule, not tied to a sale.

  • An AVM is a software-based estimate of a property's value generated from public records, tax data, and recent comparable sales — fast and free, but less precise than a licensed appraisal.

  • A bumpable buyer has a contract contingent on selling their current home, but with a "bump" (kick-out) clause that lets the seller keep marketing the property and accept a stronger, non-contingent offer if one comes along — bumping the first buyer unless they remove their contingency within a set window.

  • A buyer's market occurs when available inventory outpaces buyer demand, typically giving buyers more negotiating power, longer days on market, and more price flexibility from sellers.

  • ClosingBasic

    Closing is the final step of a real estate transaction, where the buyer signs loan documents, funds are disbursed, the deed is recorded, and ownership officially transfers to the buyer.

  • Closing costs are the fees and charges, beyond the down payment, needed to complete a real estate purchase or loan, such as lender fees, the appraisal, title insurance, settlement and recording fees, and transfer taxes. They are paid at closing and matter because they add substantial cash on top of the down payment.

  • Comparable sales, or comps, are recently sold properties similar to a subject property in location, size, age, condition and features. Appraisers, agents and investors adjust comps for their differences to estimate the subject property's market value or, for a renovation project, its after-repair value.

  • A CMA is an agent-prepared report estimating a property's value by comparing it to similar recently sold, active, and pending listings in the area — commonly used to help set a listing price.

  • Contingent describes an offer or home sale that depends on conditions being met, such as a satisfactory inspection, loan approval, an appraisal at or above the price, or the buyer selling another home. If a condition fails, the buyer can usually cancel; a non-contingent offer gives those protections up.

  • CTG is the abbreviation many MLS listing systems use for Contingent status: the seller has accepted an offer, but the sale still depends on conditions such as inspection, financing or appraisal. The exact codes, and whether a contingent home can still be shown or take backup offers, vary by MLS.

  • Curb appeal is how attractive a property looks from the street — landscaping, exterior condition, and first impression — often the first factor influencing a buyer's interest before they even step inside.

  • Days on market is the number of days a property has been actively listed for sale, from listing date to going under contract — a key indicator of how a property is performing relative to the local market.

  • Depreciation is a decrease in a property's value over time — from market conditions or physical wear — or, for investors, a tax deduction that spreads a rental property's cost over its useful life.

  • End BuyerAdvanced

    In a wholesale real estate deal, the end buyer is the final purchaser — typically an investor or owner-occupant — who buys the property from the wholesaler, as opposed to the wholesaler who briefly controls the contract in between.

  • FSBO describes a home sale where the seller lists and markets the property directly, without hiring a listing agent — potentially saving on listing-side commission, but taking on the agent's pricing, marketing, and negotiation work themselves.

  • Home equity is the portion of a property's value the owner actually owns: the difference between what the home is worth and what is still owed on every loan secured by it. It grows as the mortgage is paid down and values rise, and is tapped only by selling or borrowing.

  • Home staging is preparing a property for sale by arranging furniture, décor, and layout to appeal to the widest range of buyers, typically to help it sell faster and for a stronger price.

  • iBuyerBasic

    An iBuyer is a company that uses automated valuation and quick due diligence to make a cash offer directly on a home, often closing in days rather than weeks — trading a typically lower sale price for speed and certainty.

  • An "in lieu of repairs" credit or cash payment is money a seller gives a buyer at closing instead of actually performing repairs identified during inspection, letting the buyer handle the work themselves after closing.

  • A listing agreement is a contract between a seller and their real estate agent, authorizing the agent to market and sell the property in exchange for a commission.

  • Listing price is the price at which a property is offered for sale — a starting point for negotiation, which may end up higher or lower than the final sale price.

  • Market value is the price a property would likely sell for in the current market, given normal conditions and a willing buyer and seller — distinct from appraised value or assessed value, which are formal estimates for specific purposes.

  • Net proceeds are what a seller actually walks away with after a sale, once the sale price is reduced by the mortgage payoff, agent commissions, closing costs, and any seller concessions.

  • A UK property listing marked "no onward chain" means the seller isn't simultaneously buying another property to move into, so the sale doesn't depend on — and can't be delayed by — a purchase further up their own chain.

  • PendingBasic

    A pending listing has an accepted offer with all contingencies satisfied, moving toward closing — typically the last status before a sale is finalized.

  • Price per square foot is a property's price divided by its total livable square footage, used to compare properties of different sizes within the same market.

  • Pro RataAdvanced

    Pro rata means dividing a shared cost or income proportionally — based on ownership percentage, square footage, or time — rather than splitting it equally.

  • ProrationsIntermediate

    Prorations are the day-by-day splitting of costs — like property taxes, HOA dues, or rent — between a buyer and seller at closing, based on how many days each party actually owned the property during the billing period.

  • A right of first refusal gives a specific party — often a tenant, co-owner, or neighbor — the option to match any offer a seller receives before the seller can sell to someone else.

  • Sale price is the final, agreed-upon price a buyer and seller settle on for a property, which becomes part of the public record and future comparable sales data.

  • A seller's agent, or listing agent, represents the seller's interests — pricing the home, marketing it, and negotiating with buyers on the seller's behalf.

  • Seller ConcessionIntermediate

    A seller concession is money a seller agrees to pay toward the buyer's closing costs and prepaid items, credited at closing. It is used to reduce the buyer's cash to close without lowering the price, and matters because loan programs cap how much a seller can contribute and it can never fund the down payment.

  • A reverse contingency flips the usual arrangement: instead of the buyer's purchase depending on selling their own home, the seller's ability to close depends on finding and closing on their own replacement property.

  • A seller's disclosure is a legally required document where a seller reports known material defects or issues with a property, such as past water damage, structural problems, or environmental hazards.

  • A seller's market occurs when buyer demand outpaces available inventory, typically leading to higher prices, faster sales, and less room for buyer negotiation.

  • Settlement is another term for closing — the final step in a real estate transaction where ownership legally transfers and remaining funds are exchanged.

  • Short SaleIntermediate

    A short sale is a sale where the lender agrees to accept less than the full mortgage balance owed, allowing a financially distressed homeowner to sell and avoid foreclosure — the lender must approve the sale price and terms in advance.

  • A property under contract has a legally binding purchase agreement in place between buyer and seller, though the sale hasn't closed yet.

Common mistakes

  • Pricing from what you need to net rather than from comparable sales.
  • Comparing offers by price alone and ignoring financing and contingencies.
  • Spending on renovations buyers will not pay for.
  • Forgetting transfer taxes, concessions and repairs when estimating proceeds.

Practical examples

A higher offer can net less

An offer $5,000 higher that asks for an $8,000 credit and has a financing contingency with a tight appraisal can net less, and be riskier, than a slightly lower offer with a large down payment.

Price reductions cost time

Overpricing usually leads to more days on market and a later price cut, which can leave a seller below where a correct initial price would have landed.

Comparisons and common questions

Calculators and guides

Frequently asked questions

How much will I make from selling my house?

Your net proceeds: the sale price minus the mortgage payoff, agent compensation, transfer taxes, concessions, repairs and other closing costs. Estimate each before you list.

Do I pay tax when I sell my home?

Often not on a main home: if you meet the ownership and use tests, up to $250,000 of gain ($500,000 for married couples filing jointly) can be excluded. Larger gains and other properties can be taxable.

Should I accept the highest offer?

Not without comparing net proceeds. Look at net proceeds after concessions and the likelihood of closing, which depends on financing, contingencies and the buyer's deposit.

Sources: Publication 523, Selling Your Home (Internal Revenue Service). Last reviewed .

Explore more of the glossary

Definitions are provided for general educational purposes and are not financial, legal, tax, or real estate advice. Rules vary by transaction and location - verify important decisions with qualified professionals.