Square Footage and The Appraiser
- April 24th, 2017
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One of the most important factors in deciding on the selling price of a home is square footage. In estimating a selling price of a property, a lot of realtors refer to the tax records for their cost per square foot calculations, but did you know that most Tax Assessor records are not 100% accurate? There are many reasons for this, such as additions, inaccurate building plans or changed plans, but the main reason is that the square footage is usually estimated for tax purposes using a variety of factors. You might be thinking, why does all this matter to me? The tax records should be close enough, right? Think about it this way, let’s say you pick up the tax records from the assessor’s office and find that a home you’re selling is recorded to be 2,300 square feet. The average comps in the area are $100 per square foot, making the home appraise for $230,000. Then let’s say someone makes an offer of $225,000 that the owner decides to take because the house has been sitting on the market for several months. The sale of the home is in progress and everything is running smoothly. The appraiser then takes measurements of the home and finds it to be 2,100 square feet. This is a difference of 200 square feet. It’s a huge error, but not uncommon. Now, because the home appraises for $210,000, which is $15,000 less than the selling price, the buyers have to decide whether or not they want to purchase a home under those circumstances. Because buying a home appraised less than the selling price affects different aspects of financing, the buyers are likely to revoke their offer. This could’ve been easily avoided by having the home measured before the initial calculations. If this has ever happened to you as a realtor, you know the devastating effects that can have both on your reputation and your bottom line, not to mention the seller. Relying on an accurate appraisal is imperative to your success and the future of your business. So if you or your clients need an appraiser to make sure that the reported square footage is correct, feel free to call our team at Aspen Appraising. We help you, help them.