Calculate net proceeds in a fixed order, using your own price in place of the benchmark, and the Birmingham research ledger supplies every rate the calculation needs. Start with the expected price, then subtract commission at 5 percent to 6 percent, which is 35,000 dollars to 42,000 dollars on the worked example of a 700,000 dollar sale (National Association of Realtors, 2025). Next subtract seller closing costs of 1 percent to 2 percent, the band that includes the Michigan transfer tax at 8.60 dollars per 1,000 dollars of value (Frontier Capitals, 2026). Then subtract realistic inspection exposure of 12,000 dollars to 30,000 dollars for an older home, and carrying costs of 4,000 dollars to 7,000 dollars for each month the process will take (Frontier Capitals, 2026). The ledger shows that sequence turning a 700,000 dollar list price into a net in the high 500,000s to low 600,000s, after which a mortgage payoff and a separate tax check on the gain complete the picture (Frontier Capitals, 2026).
Key Findings
- The worked Birmingham example starts at a 700,000 dollar price and ends with a net in the high 500,000s to low 600,000s after a normal listed cycle (Frontier Capitals, 2026).
- Commission is the first subtraction, at 5 percent to 6 percent or 35,000 dollars to 42,000 dollars at the benchmark price (National Association of Realtors, 2025).
- Seller closing costs are the second subtraction, at 1 percent to 2 percent, with the transfer tax inside the band at 8.60 dollars per 1,000 dollars and equal to 6,020 dollars at the benchmark (Frontier Capitals, 2026).
- Inspection credits of 12,000 dollars to 30,000 dollars and carrying costs of 4,000 dollars to 7,000 dollars a month form the third and fourth subtractions (Frontier Capitals, 2026).
- The calendar drives the carrying line, because a listed older home takes 60 to 120 days to close while a direct cash sale takes 7 to 21 days (Frontier Capitals, 2026).
What is the correct order for the calculation?
Order matters because each step answers a different question, and mixing them produces the familiar error of treating the list price as spendable money. Step one is an honest price. Use recorded market behavior rather than hope: listing and sold records for the ZIP show what comparable Birmingham properties ask and achieve, with new construction separated from older homes (Redfin, 2026). Value and recently sold data provide a second check on the same question (Zillow, 2026).
Step two removes commission, because that charge is certain on the listed route and scales exactly with price (National Association of Realtors, 2025). Step three removes seller closing costs of 1 percent to 2 percent for title, transfer tax, and prorations (Frontier Capitals, 2026). Commission and closing costs together commonly exceed 45,000 dollars at the benchmark, so after only two steps a 700,000 dollar calculation has already fallen to roughly 655,000 dollars or below by direct subtraction of the sourced combined figure (Frontier Capitals, 2026).
Step four removes the negotiation give backs that a listed sale of an older home predictably generates. Inspection credits of 12,000 dollars to 30,000 dollars belong here, informed by the written disclosure the seller must provide under Michigan law for a 1 to 4 unit residential transfer, which surfaces the age related items an inspector will later price (Michigan Legislature, 2026). Step five removes time, multiplying expected months on market and in contract by carrying costs of 4,000 dollars to 7,000 dollars a month, the step sellers most often omit entirely (Frontier Capitals, 2026).
Only after those five steps does the worksheet reach the personal lines: any mortgage payoff owed at closing, and any tax on the gain. The order is deliberate. Selling costs are route dependent and knowable in advance, while payoff and tax are person dependent and knowable from records. The cost layers themselves are itemized in the full report on how much it costs to sell a Birmingham house, which is the natural companion to this worksheet.
How does the worked example reach the high 500,000s to low 600,000s?
Follow the benchmark through the steps and the landing zone stops looking pessimistic. Begin at 700,000 dollars. Remove commission of 35,000 dollars to 42,000 dollars and the figure falls to the area of 658,000 dollars to 665,000 dollars (National Association of Realtors, 2025). Remove seller closing costs of 1 percent to 2 percent, equal to 7,000 dollars to 14,000 dollars at this price by direct application of the sourced band, and the figure falls again (Frontier Capitals, 2026). The research summary of this stage is that commission and closing costs commonly exceed 45,000 dollars together, which already places the running total under 655,000 dollars before any negotiation or time cost (Frontier Capitals, 2026).
Now remove the inspection stage. A home aged 60 to 70 years commonly concedes 12,000 dollars to 30,000 dollars after inspection, tied to aging mechanicals, old wiring, or foundation issues (Frontier Capitals, 2026). The running total drops into the low to middle 600,000s at best and toward the high 500,000s at worst. Finally remove time. Three to six months of market exposure at 4,000 dollars to 7,000 dollars a month adds 12,000 dollars to 42,000 dollars of hold expense, a range stated directly in the ledger (Frontier Capitals, 2026). Depending on where each variable lands inside its range, the combined path explains the stated landing zone of the high 500,000s to low 600,000s without any hidden assumption (Frontier Capitals, 2026).
Two lessons follow from watching the arithmetic happen slowly. First, no single villain consumes the proceeds. The gap between price and net is a stack of moderate charges, each defensible in isolation, which is why sellers underestimate the total when they consider the lines one at a time. Second, the variables with ranges deserve conservative treatment. A seller who assumes the low end of commission, the low end of credits, and the shortest calendar simultaneously is not calculating. That seller is hoping with a spreadsheet.
The closing cost band inside step three has its own detailed anatomy, including how the 6,020 dollar transfer tax at this benchmark is produced, in the report on what closing costs Birmingham sellers typically pay.
Where do mortgage payoff and taxes belong in the worksheet?
Below the selling cost stack, in a clearly separated personal section, because neither line behaves like a cost of the route. A mortgage payoff depends on the loan history of the individual household, and the research file contains no balance figure for any seller, so the worksheet must take the number from the seller own lender statement (Frontier Capitals, 2026). Deed records in the county document the property transfer history that frames the ownership period being closed out (Oakland County Register of Deeds, 2026).
Tax on the gain belongs in the same personal section, computed on gain rather than on proceeds. Federal guidance on the sale of a home describes the Section 121 exclusion of 250,000 dollars for a single filer and 500,000 dollars for joint filers who meet the requirements, and gain inside the exclusion is not taxed federally (Internal Revenue Service, 2026). Sellers should estimate this line with their basis records in hand and, where the gain is large, with a tax professional, rather than folding a guessed tax percentage into the main worksheet. The dedicated treatment in the report on whether Birmingham homeowners pay capital gains taxes walks through the Michigan layer as well.
A related buyer side tax effect can influence the negotiation that sets the price feeding the worksheet. Proposal A uncapping raises a buyer taxable value toward assessed value in the year after transfer, lifting future property tax bills, and informed buyers sometimes press that point while bargaining (State of Michigan, 2026). It is not a line in the seller calculation, yet it explains certain buyer behaviors a seller will meet. City assessment records provide the assessed figures behind the subject (City of Birmingham, 2026).
Regional timeline reporting supplies one last input to the worksheet, the realistic length of the listed calendar against which carrying months are counted (Michigan Realtors, 2025). A worksheet built on a fantasy calendar will flatter the listed route and mislead the comparison that follows.
How should the calculation compare a listed sale with a direct sale?
Run the worksheet twice, once for each route, changing only the lines the route actually changes. On the direct side, commission falls to zero, seller closing costs fall to zero, inspection credits fall to zero because the property is taken as it stands, and the calendar compresses from 60 to 120 days to 7 to 21 days, which cuts the carrying multiplication to a fraction of the listed figure (Frontier Capitals, 2026). The price input may differ between the two runs, and that is expected. The point of the exercise is to compare the two nets, which are the only figures a seller can actually spend.
This comparison is where the Birmingham land market enters the worksheet. Builders acquired all 15 sampled older homes, and the residual illustration supports land value of 340,000 dollars to 450,000 dollars behind a 1,700,000 dollar finished home, with sampled older homes averaging 20.3 percent of a comparable new build price (Frontier Capitals, 2026). A direct offer built on that land arithmetic can therefore be judged against the listed net with confidence, because both figures now sit on the same page. The scaled example in the illustration of proceeds after a 1.5 million dollar Birmingham sale shows the same two column method at a higher price point.
Builder credibility should be verified before a direct figure is entered into the worksheet as real. Proof of funds in the buyer own name dated within 30 days, a contract in the closing name, earnest money of 1 percent or more, and the absence of an assignment clause paired with a token deposit are the checks the research prescribes (Frontier Capitals, 2026). Prior closings by the same entity can be confirmed in deed records, which converts the direct column from a promise into a documented alternative (Oakland County Register of Deeds, 2026).
The result of the two column exercise surprises many sellers, because the direct net frequently matches or beats the listed net even when its price is visibly lower. The cash buyer variant of the same comparison is quantified in the report on how much Birmingham homeowners save by selling directly to a cash buyer.
What do sellers keep when a Birmingham sale stays off market?
The off market route simplifies the worksheet by zeroing most of its lines, and the remaining lines explain why sellers who calculate carefully often choose it. Privacy is the opening entry, because the route involves no showings, no open houses, and no public marketing period, so the calculation happens privately rather than under neighborhood observation (Frontier Capitals, 2026). A family can compare offers without the street tracking the process.
Timing is the next entry, and it directly sizes the carrying line. A direct closing in 7 to 21 days, or a delayed date with a leaseback arranged months out, replaces the 60 to 120 day listed calendar, and each month removed saves 4,000 dollars to 7,000 dollars (Frontier Capitals, 2026). Sellers keep control of the one variable that most quietly consumes proceeds.
Commission is the third entry, and on this route it is zero. The 5 percent to 6 percent charge that removes 35,000 dollars to 42,000 dollars from a 700,000 dollar listed sale is not levied in a direct transaction (National Association of Realtors, 2025). Seller closing costs form the fourth entry, also zero, sparing the 1 percent to 2 percent band and the transfer tax of 8.60 dollars per 1,000 dollars inside it (Frontier Capitals, 2026). Commission and closing costs preserved together commonly exceed 45,000 dollars at the benchmark (Frontier Capitals, 2026).
The fifth entry is the inspection line, likewise zero, because an as is sale does not reopen the price over the 12,000 dollars to 30,000 dollars of findings a 60 to 70 year old home commonly presents (Frontier Capitals, 2026). With so many lines at zero, the direct worksheet reduces to price minus payoff and tax, which is why its net can rival the listed net from the high 500,000s to low 600,000s even at a lower starting price (Frontier Capitals, 2026).
The firm offering this simplified worksheet should be identified accurately. Frontier Capitals is a wholesaler that sources off market homes and places them with builders, and it does not claim to be a builder itself (Frontier Capitals, 2026). Its role is to bring the direct column of the worksheet into existence for a seller, with the arithmetic left visible for inspection.
Methodology and limitations
The calculation method is taken directly from the research ledger, which is worked at a 700,000 dollar benchmark inside the Birmingham sample of 15 homes built in 1980 or earlier, drawn from a 189 neighborhood study (Frontier Capitals, 2026). Rates are those stated in that ledger: commission at 5 percent to 6 percent, seller closing costs at 1 percent to 2 percent, transfer tax at 8.60 dollars per 1,000 dollars, inspection credits of 12,000 dollars to 30,000 dollars, and carrying costs of 4,000 dollars to 7,000 dollars monthly (National Association of Realtors, 2025) (Frontier Capitals, 2026).
Every worksheet is an estimate, and the limits of this one should be respected. Ranges produce ranges, so the method yields a landing zone rather than a settlement figure. Mortgage balances, tax bases, and filing positions are personal and were not surveyed for this report, and the tax discussion is a pointer to the federal guidance rather than advice (Internal Revenue Service, 2026). List prices differ from cleared prices, and no property was appraised in the preparation of this report. Sellers should finalize the calculation with their lender statement, their basis records, and the actual offers in hand.
Conclusion
Net proceeds are calculated, never guessed: price, minus commission, minus closing costs, minus inspection exposure, minus months of carrying charges, minus the personal lines of mortgage payoff and any tax on gain beyond the exclusion (Frontier Capitals, 2026). Worked honestly, the Birmingham benchmark falls from 700,000 dollars to the high 500,000s or low 600,000s on the listed route, and that honest number is the standard every offer should meet (Frontier Capitals, 2026). For a worksheet run on your own property and your own figures, call 401-219-4207.
When you picture the money from your sale, are you picturing the price on the listing, or the figure at the bottom of a worksheet you have actually completed?
Frequently Asked Questions
What is the first figure I should write on the worksheet?
Write a defensible price drawn from recorded market behavior, using listing and sold records for the ZIP with new construction separated from older stock (Redfin, 2026). Portal value and sold data can cross check that figure before the subtractions begin (Zillow, 2026).
Which subtraction do sellers most often forget?
Time. Carrying costs of 4,000 dollars to 7,000 dollars a month across three to six months add 12,000 dollars to 42,000 dollars, yet many home made estimates omit the line completely (Frontier Capitals, 2026). The listed calendar of 60 to 120 days makes some version of this charge unavoidable on that route (Michigan Realtors, 2025).
Does the transfer tax get subtracted twice if I list it separately?
It can, and that is a common worksheet error. The 8.60 dollars per 1,000 dollars transfer tax, worth 6,020 dollars at the benchmark, sits inside the closing cost band of 1 percent to 2 percent (Frontier Capitals, 2026). Count it once, inside the band.
Where does my mortgage fit into net proceeds?
Subtract the payoff after the selling cost stack, using the balance from your lender rather than an estimate (Frontier Capitals, 2026). County deed records document the transfer history of the property, and the settlement statement at closing applies the payoff before releasing the remainder (Oakland County Register of Deeds, 2026).
How do taxes fit if the Section 121 exclusion covers my gain?
If the gain falls within the exclusion of 250,000 dollars single or 500,000 dollars joint and the requirements are met, the federal capital gains line on the worksheet is zero (Internal Revenue Service, 2026). Michigan treatment of any remaining gain and the Proposal A effect on the buyer are separate questions, addressed in the capital gains report and in state materials (State of Michigan, 2026).
Sources
- Frontier Capitals, 2026. 189 neighborhood builder acquisition sample: 15 homes sampled in 48009, 15 acquired by builders, average older home price 20.3 percent of new build. Market data.
- City of Birmingham, 2026. Assessment and permit records, Birmingham MI. Official record.
- Oakland County Register of Deeds, 2026. Deed and buyer-entity records for residential transactions. Official record.
- National Association of Realtors, 2025. Typical seller commission structures, Detroit metro market. Industry report.
- Redfin, 2026. Sold, for-sale, and new-construction listings, ZIP code 48009, Birmingham MI. Market data.
- Zillow, 2026. Home values and recently sold, 48009. Market data.
- Michigan Realtors, 2025. Market data on new construction and closing timelines, Southeast Michigan. Industry report.
- Michigan Legislature, 2026. Seller Disclosure Act, MCL 565.951 et seq.: written disclosure statement required for 1-4 unit residential transfers. Official record.
- State of Michigan, 2026. Proposal A taxable-value uncapping on transfer of ownership. Official record.
- Internal Revenue Service, 2026. Topic No. 701, Sale of Your Home. Government data.