Square Footage - Buyer Beware!

[Anonymous]

Finally found a home I wanted in the neighborhood I wanted. Listed at 1950 sq ft  and 269k but it felt a little small. Negotiated a price based on fair market value. 30yr old home. Offered $131 a sq ft. $255k. Seller countered $137 a sq ft. $267k. We agreed.

Problem is home was listed as 1950 sq ft. While looking over disclosure HOA docs I see the house is listed as 1650 sq ft.  Seller says no its 1950.  Had to have inspector go out and measure and he said ballpark is closer to 1650 sq ft but until he did the map he couldnt say for sure.  Still in option so I send the buyer a new offer. I go up to $140 a sq ft. $231k.  Seller counters at 265k. He said he was offended that we adjusted the offer based on the 300 sq ft loss! How about I'm offended you tried to pass off a 1650sq ft house as a 1950 sq ft house.

In my research I discovered I was lucky i discovered the discrepancy during option period. Buyers beware. Measure homes you are looking at before you get too far in the process.

I'm so bummed it didnt work out but there is no way I could have committed to that price. It would have been discovered during appraisal later but only after more time and work had been put into it.

Anyone been thru anything like this?

[Revelate]

Yuck.  I assume you asked why there was such a disparity?

Out of curiosity what was the size on the appraisal?

[Anonymous]

Just received the inspector report. He came up with 1450 sq ft! Owner acted suprised. No explanation but not willing to adjust price. Still in option period so I said if the seller was not willing to budge on price I was not paying for an official appraisal. Asked seller for a copy of his appraisal but he couldnt get a hold of anyone at his title company.

Seller honestly believed that the size of the house has no bearing on the price.

[Anonymous]

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@Anonymous wrote:
Just looked over the report the i spector sent a d he came up with 1450 sq ft! Owner acted suprised. No explanation but not willing to adjust price. Still in option period so I said if the seller was not willing to budge on price so I was not paying for an official appraisal. Asked seller for a copy of his appraisal but he couldnt get a hold of anyone at his title company.

Seller honestly believed that the size of the house has no bearing on the price.

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Yeah, most sellers are just plain greedy. When all guidelines are basically price per sq ft, why wouldn't they think it has any bearing on the worth?

I don't know about where you are, but here the property appraiser is onlne and you can look up any property. I would assume it would be accurate. Maybe you can check for the next house you find.

[Anonymous]

That added to the confusion. The county tax record on file had  house listed as 1950 sq ft too. Clearly a mistake on someone's part.

[StartingOver10]

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@Anonymous wrote:

Just received the inspector report. He came up with 1450 sq ft! Owner acted suprised. No explanation but not willing to adjust price. Still in option period so I said if the seller was not willing to budge on price I was not paying for an official appraisal. Asked seller for a copy of his appraisal but he couldnt get a hold of anyone at his title company.

Seller honestly believed that the size of the house has no bearing on the price.

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Some comments:

• It is not unusual for sellers' to rely on tax data for their sq footage size - and tax rolls are notorious for having incorrect sq footage.  There is an entire community located about 10 minutes south of me where ALL of the homes have the wrong size on the tax rolls by about 500 sf. The property appraisers office has the homes showing more than what they have in reality. Do NOT assume tax data is accurate because it isn't. The only way to know is to have the home professionally measured.
• You can hire an appraiser to come out and measure your home without hiring the appraiser to do a full blown appraisal. It is significantly less expensive but will get you the actual size of your home.  There are other measuring services too. 
• The statement I highlighted in blue makes no sense to me at all.  Title company's don't maintain appraisal copies, and it is completely off base to think that they do. Lenders maintain a copy of the appraisal but its relevance for value diminishes over time. The seller would have an appraisal from the last time he financed the property and that appraisal should show the measurements and the size. The value would be out of date unless the appraisal was commissioned and completed recently. But that wouldn't change the size at all. 

For the last statement:  welcome to my world (I'm a Realtor).  It is one of the misconceptions we have to fight all the time with some sellers.  They don't know or don't care about size when they are comparing "comps" which are in no way comparable. They also don't compare condition, location or view   This happens when a seller is looking for a certain dollar amount - regardless of the property they are actually selling.  Sometimes it indicates financial distress - 

[DallasLoanGuy]

county had mine wrong.... they had it too small. 

i didnt complain until time to sell.... ;-)

then I made sure the listing included the correct sq ft in bold letters.

had no problems and we closed like clockwork.

[Anonymous]

What difference does the square footage make and to whom?

My home is listed on assessor's records as 650 square foot.

I think the house is more like 2400 square feet by outside dimensions.

Did I necessarily get a copy of the appraisal last time I refinanced?  I'm good at keeping papers, but didn't find that looking.

Thank you.

[StartingOver10]

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@Anonymous wrote:

What difference does the square footage make and to whom?

My home is listed on assessor's records as 650 square foot.

I think the house is more like 2400 square feet by outside dimensions.

Did I necessarily get a copy of the appraisal last time I refinanced?  I'm good at keeping papers, but didn't find that looking.

Thank you.

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Square footage is one of the factors used to determine value - along with other items. In any given marketplace it is unlikely that a 650 sf home is equal to a 2400 sf home. 

However, not all square footage has the same value. It varies from neighborhood to neighborhood and there are other influences too such as condition, location, view. In some markets if sq footage is added without a building permit it negatively impacts the value of your home. This is market specific. 

You should have received a copy of your appraisal from the lender when you refinanced. Most of the time the appraisal is emailed to you.  Appraisals are only good for a limited time period - usually 6 months. The older they are, the less relevance they have to today's market value. If you look at the valuation you will see that it says $X with an effective date of y.  

[Anonymous]

Umm square footage is important to most buyers as it tells us how much living space we are purchasing. Outside square footage means nothing to me as it includes non-living space. We needed at least 1700 square ft of living space for our family so we didn't even waste time looking at listing with small square footage listed.

Also it is a useful tool for comparing costs if two are pretty close after checking them out. For instance we liked 2 homes one was 1498 square ft for 175,000 and one was 1976 fsq ft for 160,000. One was nearly new but the what decided it was 1. Layout and 2. Square footage.