Saturday, February 21, 2009

How Do We Compare Homes By Comparing Price Per Square Foot?

It is common practice in this region to compare and buy homes on a square foot basis, but that can often lead to some confusion. If you are looking at a 1,500 square foot home, for example, you can find anything from two to five bedrooms. The garage can be non-existent, or have a three car capacity. And of course there is the matter of location.

A 1,500 square foot home in Monte Carlo will cost you $6,630,000! In Dayton that can be under $150,000 today. Minden – roughly $255,000. Location does matter! Some local location aspects to consider include: a. street frontage … is yours a busy street? (If you are a Buyer, remember, busy relative to our local market, not the big city you are moving from.) b. Distance to medical, schools, and shopping.

The spectacular price per square foot they get in Monte Carlo, $4,420, is even more astounding when you consider the average home is on a very small lot, the proverbial “postage stamp” lot. In our region one can easily find a home on five acres as on a quarter of an acre. When comparing per-square-foot prices in this area one must consider the size of the lot and allowable uses. Can you have horses? Can you store your RV on your lot? Conversely, can your neighbor – not all positive answers here are positive to all people.

There are many intangibles that impact the value in a very real manner such as the C.C.&R.’s of your development, if any. Are you in a Homeowner’s Association and, if so, how is the management? Are they oppressive? Is it expensive? What government structure affects you – not only County, but TRPA? Improvement District? Regional Action Committee?, etc. All hard to measure, but definitely can add cost to your ownership, or affect the manner in which you, or your neighbors, utilize your property. This can be good, or bad, depending on the property and what your intended uses are.

Our Advice: Don’t rely simply on the numbers, it is important to interpret them. Garages aren’t included in the square footage figures, but there is certainly added value if you have a two car garage versus a carport. A 2,400 sq.ft. “toy box”, shop, certainly adds value, but it isn’t reflected in the price per square foot number unless you interpret it to understand why that home is higher priced … if it is. If it isn’t … can you spell v-a-l-u-e? New paint & carpet; granite vs. formica; landscaping vs. dirt - all must be considered and compared before making a buying or selling decision. The square foot price will get you close … your agent will get you closer by working with you to gain a better overall perspective on “true” value for a specific property.

Prices are relative to your market. A 3,500 sq.ft. home in Monte Carlo will cost you $15,470,000. It won’t cost you that much here … but how much are you going to pay … and what will you get for it? Have fun … that is the challenge of buying in our wonderfully diverse regional market. When it comes to choosing professionals to assist you with your real estate needs… Experience is Priceless! Lisa Wetzel & Jim Valentine, RE/MAX Realty Affiliates, 775-781- 5472.,

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