Title Tip: 2019 Data Shows How Texas Ranks on Closing Costs
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Recently released national closing cost data showed that in 2019 average closing costs remained flat despite an increase in home prices. The average closing costs in Texas was $3,744 with an average sales price of $274,163.
The average closing costs in Texas was 1.75 percent of the sales price. That put Texas ranked 28th in the country for closing costs based on the percentage of the sales price.
Consumers Can Shop Around For Closing
The closing cost data, announced by ClosingCorp, calculated the cost of title insurance, appraisals, settlement fees, recording fees, surveys, and transfer taxes. We don’t have transfer taxes in Texas. If we exclude those transfer taxes, Texas still ranks 28.
The states with the highest average closing costs, excluding taxes, were Washington, D.C.; New York; Hawaii; and California. That is a reflection of both closing costs and average sales prices being high. If you look at the highest closing by state based solely on the percentage of sales price, the highest states were Pennsylvania; Delaware; Washington, D.C.; and Maryland. Their percentage averaged more than double the closing costs in Texas.
In most states, consumers can shop around and compare closing costs like they would a mortgage loan or homeowner insurance. Title insurance rates often vary based on several factors such as the purchaser’s credit scores or amount of their down payment. The escrow, legal, and closing fees can even vary from county to county within a state.
Title Insurance in Texas
In Texas, the cost of title insurance is set and regulated by the state. All Texas title companies are required to charge the same for a title policy. The debate comes up every few years that Texas title insurance should be unregulated. The argument is usually that the free market and more competition would help reduce the cost to the consumer. The Texas Department of Insurance actually lowered title insurance rates in September 2019. For now, the system seems to be working well for our state.
