The realty transfer tax is often the single largest line item at a Delaware closing. Understanding how it works ahead of time helps buyers and sellers budget with no surprises.
The rate: 4% total
Delaware's realty transfer tax is generally 4% of the purchase price, made up of a 2.5% state portion and a 1.5% county or municipal portion.
Who pays?
The 4% is most commonly split 50/50 between buyer and seller — about 2% each — though this can be negotiated in the purchase agreement.
First-time homebuyer exemption
Qualifying first-time Delaware homebuyers are exempt from 0.5% of the state's portion on the first $400,000 of the purchase price — a savings of up to $2,000 on the buyer's side.
An example
- On a $500,000 home, the total transfer tax is $20,000 (4%).
- Split evenly, that's $10,000 each for buyer and seller.
- A qualifying first-time buyer saves 0.5% on the first $400,000 — $2,000 — bringing their share to about $8,000.
You can run your own numbers, including the first-time buyer toggle, with the transfer tax calculator. Always confirm the final figures with your closing attorney or title company.