Question: Why does closing cost so much?

Answer: State and local governments have discovered that real estate transfers are wondrous opportunities to tax with little political responsibility.

If a politician says that taxes should be raised, the individual may well be out of work when elections next roll around. But, if real estate transfer taxes are raised, the game changes because many of those impacted by the higher tax will move elsewhere -- and thus they cannot vote against the politician.

The result is that transfer taxes and "stamps" often amount to thousands of dollars per transaction -- income which is enormously profitable to states and local communities.