A frequent topic of debate and though it can be a simple measurement it only works if you are comparing apples to apples.
How can you compare two different things. Let's start with some extreme examples and then work our way back to reality. What is the cost per # of a Ford Taurus to a Jaguar XL? What about a Dodge Truck compared to a Ford? They are different products with different features and benefits but you would not buy based on cost per pound?
Homes are the same way. First, lets level the playing field to understand why it can be difficult to compare cost per square foot of a home.
- Lot size
- floor plans
- upgrades (ie granite)
- location
- communitiy amenities
- benefits of the home (ie pressurized irrigation)
- features of the home (fence around home (type, heighth) and landscaping (mature, how extensive)
- unseen differences like energy efficiences from insulation or quality seals in doors to windows and energy efficient HVAC.
- Age of home. Note- most new homes have warranties.
- and more
That is not to say that it is not something to measure but it has to be in context. For example if one home has 1,500 ft2 between a family room, a bonus room and formal living room and the other home has the same square footage between a family room and bonus room, cost per square foot is dissimiliar. It really only works if you compare models of very similiar homes on very similiar sized lots. If two home are so similiar, it could be a basis to make a decision or possible leverage to negotiate price for the one you prefer, especially in today'smarket.
Builders may talk about price per square foot if their competitive edge is efficiencies where they can provide more per square foot in the price like Hubble and CBH position themselves. Most builders are trying to separate their homes from the competitiion so it is difficult to compare.
The real measure is value to you! Sometimes it may be the least cost per square foot but make sure you are not losing $ somewhere else, like monthly energy bills becasue the home is poorly insulated, has leaky windows? Also, if there is a big discrepency what does that tell you? Really, what does that tell? If the homes are so similiar it may tell you the seller is more motivated but maybe not?
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Empowering Home Buyers,
Trey Langford
Founder, Building Credibility.com
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