If real estate rule No. 1 is "location, location, location," rule No. 2 may be that not all square footage is created equal.
Many shoppers blindly trust that the size of a new home featured in an ad or brochure is accurate. But the reality is that no official industry standard exists for calculating residential square footage, nor is there widespread consensus on the correct measuring methodology.
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Some builders and agents, for example, tally a home's total footprint, including uninhabitable space (such as areas between walls), while others round off calculations to the next highest number.
Mike Zucker, who recently bought a new 4,181-square-foot home from King's Court Builders at Ashwood Creek in Naperville, was careful to ask the builder how his custom home's square footage was calculated.
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He was told that it was based on the architect's blueprint measurements, and that volume space (such as the extra space above a two-story foyer) was not added, nor was his 1,962-square-foot finished lookout basem*nt.
"The question of square footage was always confusing to me way back when," Zucker said.
What he learned after doing his homework and before buying his new home is that "some builders take a home's base and double it for the second story."
"They'll tell you you're buying a 4,000-square-foot home when you're really buying a 3,700-square-foot home in which the builder has doubled the calculations for the two-story family room," Zucker said.
Square footage "is not an exact measurement based on definable criteria. Because of this, each architect, builder and appraiser does it a little differently," said Dick Greenwood, a real estate broker and director of builder marketing for Coldwell Banker Residential Brokerage in Northbrook.
For example, Brian Brunhofer, president of Deerfield-based Meritus Homes, said his firm calculates square footage according to the BOMA (Building Owners and Managers Association) standard, the most common method used by landlords to measure office space. Like many builders, Brunhofer doesn't include the second floor of two-story volume space, garage space, porches, decks, patios, attics or unfinished basem*nt areas.
On the other hand, home appraisers such as Bruce Wittman, partner with Papineau Wittman Group in Joliet, calculate gross living area defined as the total finished, walkable and heated area above grade, as measured along the building's exterior. Completed areas below grade, such as finished basem*nts, are not included in the gross living area.
"In my market area, builders are pretty accurate in the square footage they provide," Wittman said. "Builders will sometimes include finished areas below grade in split-level or bilevel houses, whereas an appraiser can only include those areas above grade in the gross living area. In this case, the finished area below grade would be given value in a different part of the appraisal report."
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Steve Carr, president of Naperville-based Carr Building and Development LLC, said in new construction the builder or architect usually determines square footage calculations.
For resale homes, square footage is typically determined by the seller's real estate agent (who will measure the dimensions or obtain predetermined measurements from the county assessor's office) or by an appraiser, who is enlisted by the seller or, if an appraisal is ordered, the buyer's lender, Wittman said.
Regardless of how square footage is quantified, its significance and relative worth to a given buyer can be substantial. Consider that price per square foot (PPSF, the home's listing price divided by its square footage) is a benchmark metric by which many home hunters compare residences and builders.
Additionally, an incorrectly high square footage recorded by a county tax assessor may result in paying higher property taxes.
PPSF "gives you the ability to shop and compare as a consumer," Zucker said. Those values, he noted, are commonly included in resale home listings on popular sites like Zillow.com and Redfin.com., and more home shoppers are paying attention to them.
But these calculations can be misleading. A few years ago, Pete Stefani, president of King's Court Builders in Naperville, was told by a potential customer that Stefani's bid to build a home was significantly higher per square foot than a quote from a competitor, who ended up constructing the home. Stefani later learned that the other builder counted the two-story foyer and two-story family room twice.
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"If I would have counted those areas as additional square footage, my quote would have come in less per square foot," Stefani said.
Greenwood contends that the value of a PPSF calculation is overrated and irrelevant today.
"Buying a home based on square-footage costs makes no sense at all. It's like paying for a car based on weight," said Greenwood. "There are many items that factor into the price of a home that cannot be measured by square feet. A 2,000-square-foot ranch will cost considerably more to build than a 2,000-square-foot two-story, since the ranch has one foot of foundation and one foot of roof for each foot of living space."
While it's true that larger homes commonly use more materials and can, therefore, be more costly to build, Carr said that using square footage as a tool to gauge a home's value relative to others on the market must be done with great care and proper perspective.
"Architectural design is a huge factor that can affect price, sometimes more than square footage," said Carr.
"For example, a smaller home with a front porch, full basem*nt, three-car garage and roof dormers could be priced more and sell for more than a larger home with simple boxlike construction and fewer architectural details," said Carr. "Setting the sale price of a home is dependent on a multitude of factors such as location, home style, level of fixtures and finishes and, of course, total square footage."
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Indeed, the flow and "livability" of a home is of much greater value to a prospective buyer, Greenwood said.
"A home that is a perfect rectangle will live a whole lot better than a home with the same square footage but shaped like a triangle," he said.
For better peace of mind regarding square footage of the abode you have your eye on, do your homework and ask plenty of questions of the builder or listing agent, said Matthias Jans, president of Matthias Jans Architect in Wheeling.
"Ask how the square footage was determined. What methodology was used? Was the volume space calculated twice? When buyers better educate themselves, they're ahead of the game," Jans said.
Additionally, Zucker recommends asking for the home's original blueprints.
"The architect's measurements on the blueprints are probably the most trustworthy," said Zucker.
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Watch out for red flags like a floor plan size that ends in an even 100 (for example, 3,600 square feet), which could indicate upward rounding, Stefani said.
Be aware, however, that builder marketing materials and multiple listing service listings usually include disclosures in fine print that indicate the dimensions provided are approximate, Brunhofer said.
Nevertheless, if you discover that the home you bought was falsely supersized and you have the evidence to prove it, litigation could be a viable recourse.
"A buyer who purchased a home relying on the quoted square footage could, if the square footage was found to be materially and intentionally different than advertised, have grounds for remediation as provided for in the contract documents," Carr said.
