Square Footage Value?

I have recently felt almost crazy due to buyers in the $500k to million +  range wanting to rely primarily on square footage pricing  information taken from online estimators to determine an offer price.  Hello!  Square footage doesn’t take into account condition, setting, view, the quality of materials used, construction details, workmanship, or lot size!  But, even more significantly, square foot pricing doesn’t reflect the functional value of those square feet — the usability of the space — its utility or suitability for a given person’s lifestyle.  A 4000 square foot home with a 500 square foot living room might look like a great buy based on square foot cost (and bring down the square foot value of all the smaller homes in the neighborhood); but — unless the buyers’ lifestyle includes frequent parties with 50 or more people to fill that space — of what real value is it?  Using the square foot cost of such a floor plan as a decision-making tool for looking at a 2600 square foot home is likely to be quite inappropriate.  On the other hand, would a small highly efficient floor plan’s square foot cost offer relevant information in determining the value to a giant living room that is only fully utilized once or twice a year?  The measuring stick must be based on an occupants’ actual preference and needs, with some consistency of viewpoint, to be relevant.  The value of square footage, of size, must take into account the specific lifestyle and aesthetics of the individual — so that one is comparing apples with apples, not apples with oranges. In the final analysis, for a value calculation based on “comparables” to be meaningful it must take into account a multitude of variables  — which Zillow and other automated online value predictors do not do.

Speaking of value predictions: in coming years I think we’ll see decreasing consumer demand overall for large square footage trophy houses and an increasing demand for home design that supports function and utility — that serves the actual day to day life activities of its occupants.  As conspicuous consumption becomes less admirable and as energy and resource efficiency becomes more valued, homes that are more energy efficient, which take advantage of natural heating and cooling cycles, will triumph in the marketplace and homes that incorporate massive spaces which serve little everyday purpose will loss popularity and therefore market value. In fact, I believe that this has already begun to happen.  I see compact and efficient floor plans constructed with architectural details embracing basic functionality in form frequently winning out over grandiose mini-mansions with pointless non-load bearing Grecian columns and Romanesque archways.

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