Price Per Square Foot? Better take a Closer Look

     One common mistake buyers  make when considering a home purchase, whether pre-owned or brand new, is to judge the home  by price per square foot.  And when our local Multiple Listing Service created a field for price per square foot on its listing form, allowing buyers to search online specifically by price per square foot, the same they would for  number of bedrooms and type of garage,  it did  a disservice to both buyers and sellers.  Price per square foot does not take into consideration whether or not the home has a two-story entry or great room, vaulted or cathedral ceilings or the three different ways stairwells are often measured.  Some appraisers count only the first floor area of the stairs; some count both floors, and others don’t count any. Plus, newer homes frequently have higher ceilings.  Builders have been creating vertical space by raising the ceiling height of the first floor from eight feet to nine or ten, creating vertical space.  Price per square foot doesn’t take into account any of these factors.

     Then, there is the issue of counting square footage in a condo.  Technically, a full service condo is interior paint to interior paint. In other words, you’re buying the interior air space of your condo.  However, we have site condos where the condo is enveloped in an air space around the exterior.  Those condos, which can include single family homes built as condos, measure outside wall to outside wall.  Some developers will identify  square footage exterior wall to exterior wall with a simple disclaimer as to how they measured, creating even more confusion, when trying to judge market value by square footage alone.

     Home designers use different software, some of which measures square footage exterior to exterior and some which  measures only the interior of the rooms. The MOA values a building permit based upon the square footage of the plan submitted.  However, that may also not be totally accurate because the builder may have decided thirty years ago while on site to cantilever the upstairs back wall and not report it to the MOA.  That square footage stays with the home for its lifetime.

     All these different ways to measure square footage ends up on the MLS form and then is divided into the asking price.  A buyer searching online  may reject a property as being unfairly priced based on the cost per square foot when in reality, how the measurements were created for each property are different.   Today, virtually all buyers shop online before ending up with a realtor or at an open house.  It is not unusual for realtors to hear, ”This home seems larger or more spacious than I thought” or  “It’s smaller than I imagined.”  That could be due to inaccurate measurement 30 years ago, software design differences or an appraiser’s opinion on how to value stairwells and yet that price per square foot has now gone out to the world, i.e. Point to Point, Zillow, Trulia, realtor.com, Homes and Land, Homefinder.com, Yahoo.com, and a plethora of other sites. The Alaska MLS  form has limited space for additional comments on property amenities.  Sellers, who are the backbone of MLS and the reason for its existence, should insist this field be taken off the form.  It is a disservice to them and the buyers who are searching www.alaskarealestate.com.