By Brent Baker | September 21, 2026

Here’s the number that actually matters when you sell: not your list price, not the Zestimate, but what hits your account after closing. And in a market like Sioux Falls — where prices have climbed and new construction is going up in every direction — a lot of sellers anchor on a headline number that’s thousands of dollars higher than what they’ll really walk away with.

Let’s fix that. Below is exactly how your net proceeds get calculated, what each cost runs in South Dakota (with notes for the southwest Minnesota side of the market), and how to estimate your own number before you ever list.

Start with the sale price, then subtract the real costs

Your net proceeds are simple math: sale price, minus selling costs, minus your remaining mortgage balance. The costs are where sellers get surprised, so let’s walk through them in the order they show up on your settlement statement.

Real estate commissions. This is the largest line item. In South Dakota, total commissions averaged about 5.61% of the sale price in 2026 — split roughly between the listing side and the buyer’s side. Since the 2024 National Association of REALTORS® settlement, buyer-agent compensation is negotiated separately rather than posted automatically in the MLS, so what you offer a buyer’s agent is a genuine conversation now, not a fixed number. Commissions are always negotiable, but for planning purposes, budgeting 5–6% total keeps you realistic.

Owner’s title insurance and closing fees. In our market, the seller customarily provides the owner’s title policy that protects the buyer, and the closing itself runs through a title company (a handful of transactions here still use an attorney). Title insurance typically runs around 0.5% of the price, plus a few hundred dollars in title search and closing service fees.

South Dakota Real Estate Transfer Fee. South Dakota keeps this refreshingly cheap: $0.50 per $500 of value — exactly $1.00 per $1,000, or 0.1% of the price. On a $525,000 home, that’s about $525. On a $1,000,000 sale, it’s $1,000. The seller customarily pays it, and it’s collected at closing.

Prorated property taxes. South Dakota property taxes are paid in arrears, so at closing you’ll typically credit the buyer for the portion of the year you owned the home. Depending on your closing date, this can be anywhere from a few hundred to a few thousand dollars.

Recording fees and miscellaneous. Small but real — deed recording and document fees usually total under $100.

A worked example on a $525,000 Sioux Falls home

Say you’re selling an existing-construction home in a well-established part of town for $525,000. Here’s a realistic estimate:

• Commissions (about 5.5%): $28,875
• Owner’s title insurance (about 0.5%): $2,625
• Title/closing service fees: $400
• SD Real Estate Transfer Fee (0.1%): $525
• Recording and document fees: $75
• Prorated property taxes (varies by closing date): $1,500–$3,500

That’s roughly $34,000–$36,000 in total selling costs, or about 6.5–7% of the price. Your net proceeds before mortgage payoff land near $489,000–$491,000. If you still owe $250,000 on your loan, you’d walk away with roughly $240,000.

Push that same math up to a $750,000 home and your costs scale to about $46,000–$50,000, leaving net proceeds near $700,000 before payoff. The percentage actually shrinks slightly at higher price points, because fixed fees like recording and transfer costs don’t grow much.

Why the Zestimate almost always overstates your net

Automated valuations estimate market value — they don’t subtract a single dollar of selling costs, and they can’t see the condition of your specific home. In a growing market, that gap gets wider, not narrower.

Two things drive the real number in Sioux Falls right now:

1. New construction is setting the pace on finishes. With builders active across the metro, resale sellers are competing against fresh product. Homes that show well and are priced right are still moving — Sioux Falls sellers received about 98.6% of their original list price recently, and well-prepared homes sell in under a month. But a home priced on hope rather than comparable sales sits, and every price reduction eats directly into your net. If you’re weighing your home against brand-new inventory, my guide on selling against new construction in Sioux Falls breaks down how to position on value rather than chase the builder’s spec sheet.
2. Inventory is still tight, but it’s not 2021. Months of supply has hovered around 3.3 — a balanced-to-seller’s market, not a frenzy. That means pricing precision matters. Getting the list price right the first time is the single biggest lever on your final net, which is exactly why I start every listing with a comparative market analysis rather than an online estimate.

What about capital gains?

Good news on the tax side: South Dakota has no state income tax, so there’s no state-level capital gains tax on your sale. On the federal side, if the home was your primary residence for at least two of the last five years, you can typically exclude up to $250,000 in gain if you’re single, or $500,000 if you’re married filing jointly. Most Sioux Falls sellers fall well within that exclusion — but if you’ve owned a long time in an appreciating market, or you’re selling an inherited or investment property, the rules change. That’s a conversation worth having with your tax professional before you list.

The southwest Minnesota side of the market

Because our market reaches into southwest Minnesota, the transfer cost works differently across the state line. Minnesota charges a State Deed Tax of $3.30 per $1,000 of price (0.33%) — more than three times South Dakota’s rate. On a $500,000 Minnesota home, that’s about $1,650 versus $500 in South Dakota. Minnesota also layers on additional seller disclosures beyond South Dakota’s, including separate well, septic, and other property-specific disclosures. If your home sits on the Minnesota side, build that higher transfer cost and the extra paperwork into your plan.

How to get your real number before you list

You don’t have to guess. The most accurate estimate comes from a seller net sheet — a line-by-line projection built on your actual price, mortgage balance, and closing date. It’s the same document I prepare for every seller before we talk strategy, and it turns “I think I’ll clear around X” into a number you can actually plan a move around.

Frequently Asked Questions

What percentage do you lose when selling a house in Sioux Falls?

Plan on total selling costs of roughly 6–8% of your sale price in a typical transaction, driven mostly by real estate commissions of around 5–6%. That doesn’t include your mortgage payoff or any repairs and concessions you negotiate with the buyer.

Who pays the transfer fee when selling a home in South Dakota?

The seller customarily pays South Dakota’s Real Estate Transfer Fee, which is $0.50 per $500 of value — $1.00 per $1,000, or 0.1% of the price. On a $500,000 home, that’s about $500, collected at closing by the title company.

Do I need an attorney to sell my house in Sioux Falls?

No. Most closings in the Sioux Falls area are handled by a title company, which manages the settlement, title insurance, and recording. A small number of transactions still involve an attorney, but it isn’t required for a standard residential sale.

Will I net less than my Zestimate?

Almost always. Automated estimates approximate market value and subtract none of your selling costs, so your net proceeds will be thousands of dollars lower than the headline figure. A comparative market analysis and a seller net sheet give you the real numbers.

How much are seller closing costs in South Dakota besides commission?

Beyond commission, expect roughly 1–3% of the sale price in closing costs — owner’s title insurance (about 0.5%), title and closing service fees, the transfer fee (0.1%), recording fees, and prorated property taxes that depend on your closing date.

The bottom line

Your sale price is the starting line, not the finish. Once you subtract commissions, title costs, South Dakota’s transfer fee, and prorated taxes, most Sioux Falls sellers keep somewhere around 92–94% of the price before paying off their mortgage — and pricing your home correctly against today’s new-construction competition protects more of that number than any single cost you can trim.

If you want a clear picture of your own net before you make a move, I’m glad to put together a personalized net sheet and walk you through it. It’s the kind of question I help sellers think through every week — reach out anytime and we’ll run your numbers together. For a broader look at the whole process, my practical guide to selling your home in Sioux Falls covers what happens from listing to closing, and if you’re selling an inherited home the net-proceeds math has a few extra wrinkles worth understanding.