Average closing costs in South Dakota

When buying a home in South Dakota, it’s important to factor in all upfront expenses, including closing costs, so you can plan accordingly. Closing costs cover the administrative and professional services required to finalize a home sale. Buyers and sellers both contribute to these costs, and the final amount varies based on the property, loan type, and local factors. Understanding closing costs early can help you save and budget with confidence.

Key takeaways:

• Closing costs in South Dakota average about 3.73% of the home’s purchase price for buyers.
• Common buyer expenses include lender fees, home appraisals and inspections, and title insurance.
• Sellers typically pay real estate agent commissions, prorated property taxes, title fees, and deed preparation costs.
• Many closing costs — including lender charges and certain third-party services — may be negotiable or reduced by comparing providers.

How much are closing costs in South Dakota?

With the median home sale price around $320,100, a buyer in South Dakota can expect to pay roughly $11,917 in closing costs, which equals about 3.73% of the home’s purchase price. These expenses include lender-related fees, title insurance, appraisal and inspection costs, escrow services, and applicable taxes that are paid at closing.

Closing costs may vary across South Dakota depending on county-level recording fees, local tax rates, and service provider costs. Planning for these differences can help buyers estimate their total cash needed at closing more accurately.

What affects closing costs in South Dakota?

Several factors can affect how much you’ll pay in closing costs in South Dakota, including:

• Where you’re buying: County-level recording fees, taxes, and insurance rates can differ across the state.
• The home’s price: Percentage-based fees increase as the home’s purchase price rises.
• Your loan type: FHA, VA, USDA, and conventional loans all have different fee structures and insurance requirements.
• Title and escrow services: Costs depend on provider rates and the complexity of the title work.
• Taxes and recording fees: Local transfer taxes, prorated property taxes, and recording costs vary by jurisdiction.
• Prepaid costs: Includes homeowners insurance, prepaid interest, and escrowed taxes.

Understanding these factors helps South Dakota buyers estimate their total cash to close and budget more effectively.

Are closing costs in South Dakota above average?

Nationally, closing costs typically range from about 0.4% to 3% of a home’s purchase price. Based on the Lodestar’s average national sales price of $438,236, typical national closing costs can fall between roughly $1,750 and $13,150. With an average buyer cost of 3.73%, South Dakota sits near the higher portion of this national range.

Overall, South Dakota’s closing costs closely align with national norms. To learn more about the closing process and how fees are calculated, review what happens when closing on a house and how transfer taxes may influence your total costs.

What do South Dakota’s closing costs include?

Closing costs in South Dakota cover the fees and services required to finalize a home purchase. Some expenses are connected to the loan process, while others relate to inspections, insurance coverage, and administrative tasks needed to complete the transfer of ownership. Knowing what each fee includes can help buyers budget more confidently.

• Lender-related fees: Includes application, origination, underwriting, and credit check fees, along with any charges tied to a mortgage rate lock.
• Appraisal fees: Required to verify the property’s value; learn more in home appraisal.
• Home and pest inspection fees: Covers inspections to identify structural or pest-related issues. Review a typical home inspection checklist for details.
• Title search and insurance: Confirms legal ownership and protects against title defects or liens. Learn more about title insurance.
• Survey fees: Verifies lot boundaries and easements, which may be required for rural properties.
• Courier and recording fees: Covers document delivery and official county recording.
• Notary fees: Ensures signatures on closing documents are legally valid.
• Prepaid items: Includes upfront costs for homeowners insurance, property taxes, prepaid interest, and homeowners insurance fees when applicable.
• Private mortgage insurance (PMI): Required for buyers putting less than 20% down.
• Attorney fees: Charged if legal services are used during closing.
• Mortgage discount points: Optional fees paid upfront to reduce the interest rate; learn more about mortgage points.

Together, these costs ensure the home purchase is completed accurately and securely. Your Loan Estimate and Closing Disclosure break down each fee so you know exactly what to expect at closing.

Who pays closing costs in South Dakota?

Both buyers and sellers in South Dakota share responsibility for closing costs. While certain fees are typically paid by one party, many items can be negotiated depending on the terms of the sale.

Closing costs for buyers

Buyers in South Dakota generally pay most lender- and property-related fees. These expenses support the loan process and ensure the property is properly inspected, valued, and transferred. Common buyer closing costs in South Dakota include:

• Loan application and origination fees
• Home appraisal and inspection
• Title search and lender’s title insurance
• Prepaid expenses
• Recording and notary fees
• Attorney fees (if used)
• Mortgage discount points

These costs help protect the buyer and lender throughout the transaction. Planning for them early can help buyers avoid surprises at closing. For more tips on preparing financially, review first-time home buyer expenses to save for.

Closing costs for sellers

Sellers in South Dakota also pay their own closing costs, some of which overlap with buyer expenses. The largest seller expense is typically the real estate agent commission, though other fees may apply. Common seller closing costs in South Dakota include:

• Real estate agent commissions
• Owner’s title insurance and title-related fees
• Prorated property taxes and HOA fees
• Deed preparation and recording fees
• Attorney fees (if used)
• Outstanding mortgages and liens
• Seller concessions

If you’re selling while still paying off a home loan, learn more in can you sell a house with a mortgage.

How to reduce your closing costs in South Dakota

Some closing costs in South Dakota — including title insurance, recording fees, property taxes, and prepaid interest — are fixed, but buyers often have flexibility in other areas. With careful planning, many buyers can reduce their total cash needed at closing.

• Research home buyer assistance programs: South Dakota Housing offers programs that provide down payment and closing cost assistance to eligible buyers. USDA Rural Development loans are also widely available throughout the state and may help reduce upfront costs for qualifying buyers.
• Shop around for a lender: Comparing loan estimates from different lenders can help you identify lower fees and more favorable terms. For guidance, review how to choose a mortgage lender.
• Negotiate seller concessions: Depending on local market conditions, sellers may be willing to contribute toward closing costs. Learn more about negotiation strategies in seller concessions.
• Consider a no-closing-cost mortgage: Some lenders allow buyers to roll closing fees into the loan amount or adjust the interest rate slightly to reduce upfront expenses. See how this works in no-closing-cost mortgage.

While not every fee is adjustable, understanding which closing costs are negotiable can help South Dakota buyers identify meaningful opportunities to save.

FAQ on closing costs in South Dakota

Does South Dakota require paying for a real estate attorney?

No, South Dakota does not require buyers or sellers to hire a real estate attorney. Closings are typically handled by real estate agents, title companies, and escrow professionals. Some buyers still choose to work with an attorney in more complex transactions. Learn more about real estate attorneys.

When do South Dakota buyers find out their closing costs?

South Dakota buyers receive an estimated breakdown of closing costs early in the mortgage process. Lenders issue a Loan Estimate within three business days of application. A Closing Disclosure is provided at least three days before closing with final figures. Reviewing both documents helps ensure accuracy.

When and how will I pay my South Dakota closing costs?

Closing costs in South Dakota are typically paid on closing day. Buyers usually pay by cashier’s check or wire transfer to the title company handling the transaction. Your Closing Disclosure will outline the amount due and payment details. Learn more about the closing timeline.

How can I save up for South Dakota’s closing costs?

Closing costs in South Dakota average about 3.73% of the home’s purchase price. Buyers can save by setting aside funds regularly, using tax refunds or bonuses, and exploring assistance programs through South Dakota Housing. For more savings strategies, visit how to save for a house.

Are South Dakota’s closing costs deductible on my taxes?

Most closing costs in South Dakota aren’t tax deductible, including appraisal fees, title insurance, and recording charges. However, some expenses — such as mortgage interest paid up front and prorated property taxes — may qualify for deductions. Homeowners who itemize may also deduct ongoing mortgage interest and property taxes. Learn more in are closing costs tax deductible and tax deductions for homeowners, or consult IRS Publication 530 and Tax Benefits for Homeowners.

The bottom line: Prepare your finances for South Dakota closing costs

Closing costs in South Dakota typically average around 3.73% of the home’s purchase price, covering expenses like lender fees, title and escrow services, insurance, taxes, and recording costs. Buyers and sellers both contribute to these costs, and the total can vary based on location, loan type, and negotiations. Knowing what to expect — and where you may have flexibility — can help you plan ahead and avoid surprises. If you’re preparing to buy a home in South Dakota, consider getting preapproved to start the mortgage process with confidence.