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How is square footage determined in a home? Who actually measures the home? These are questions that buyer may have about homes as they shop around.

Since the square footage is a measurable fact about a home, it can be used to base value or purchase price for the home. Certainly it is one of the factors that the tax assessor uses to determine the value of the property. So, where does this number come from?

The listing broker will need to disclose how that data was determined and also, they will be held liable for its veracity. The rule requires the listing licensee to accurately represent measurements in writing and will probably be done in the same manner as the federally mandated lead-based paint disclosure is today. Most listing brokers will leave copies of the disclosure in the home for interested parties to examine. In any case, the disclosure should be made before the buyer makes an offer.

The disclosure will indicate if the agent themselves measured the home, if the information was from an appraisal, building plans or other source, and when these measurements were taken. The measurements must be taken using a commonly accepted standard such as the American National Standards Institute, HUD and Fannie Mae.

Square footage is determined by using the exterior measurements. Often this can be the root of the problem if the person measuring doesn't take into consideration two-story rooms, staircases or irregular floor plans. It is common to see the square footage measurements on a two-story (without cantilevers) to be the same for the main and upper level, when in fact the upper square footage should reflect a reduction in square footage for the staircase. Certainly the square footage should be further reduced if the home has a two-story foyer. With many homes today selling for $125 per square foot (or more), a 150-square-foot mistake can mean the difference of $18,750 in value.

The listing agent must use a reliable source for these measurements, an example of potentially unreliable source would be in new construction; often the room sizes are rounded off top the next highest number. Also, our multi-list system rounds to the nearest foot. The listing agent is responsible for "indications pointing to obvious and significant mismanagement by others." For example, if the agent is using the measurements from an appraisal that is several years old and the seller has made a substantial addition to the home subsequent to this appraisal, then the agent should make the appropriate adjustments in square footage and room measurements.

In the past, many brokers added wording to the contract indicating that the buyer should verify the square footage if it is important to them, but a new law will not allow brokers to "disclaim" the measurement and square footage. Verification of these items is a safeguard for the buyer. However, it does not let the listing broker off the hook.

In addition, if the listing agent has a "seller agency" listing agreement with the seller, it may be prudent for the seller to ask for and sign the same measurement disclosure. In the seller agency agreement the seller has liability for what the broker says about the home including square footage and measurements.


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