# How To Calculate Price Per Square Fee To Appreciate Home ## If there's one thing buyers and sellers will hardly agree on, it's how much the house is worth!

Sellers will want to set the highest possible price, and buyers will want to pay as little as possible. Negotiations go back and forth, with each party proposing what they consider to be solid logic to back up their offer or counter-offer. One solution that may seem like a neutral compromise is to allow the price per square foot to determine the selling price of the home. But how to calculate a price for a square foot?
Unfortunately, this is not so easy. Even when you know exactly how to calculate a price per square foot, there is room for error that can end up costing you hundreds or thousands of dollars.

### Square Foot How to calculate price per square foot

Calculating a price per square foot is a seemingly simple operation. The price of the house is divided into areas, to reach the price per square foot. For example, for a house of 2,000 square feet priced at \$ 300,000, the price per square foot is \$ 150.

Alternatively, you can use the price per square foot and area of ​​a house to determine the price. If the house is 2,000 square feet and the price per square foot is \$ 150, the value of the house will be \$ 300,000.

How to calculate a price per square foot may seem simple, but the reality is that determining the price becomes much more complicated. And even a slight mathematical error can be a difference of thousands of dollars in the estimated value of a home.

### Possible errors in calculation

When determining how to accurately calculate a price per square foot, the numbers you use in the equation must be correct. But this is not always the case. Mistakes or inconsistencies in the square footage or price per square foot can have major financial consequences.

The first, square number of the house can be determined in different ways:

Measured from the inside, using standards
ANSI

Measured by walking around the house

Measurement extracted from the photographs used for the assessment

All methods can yield a different square size. And naturally, the seller will want to use the highest number and the buyer will want to use the lowest number.

On top of the problem, two skilled professionals using the same measurement system usually come with different numbers. Even if they know how to calculate a price per square foot, there is room for error, and a few inches here or there can create huge gaps in numbers.

### Setting the price per square foot

Once the size of the house is determined, the next number to consider is the price per square foot. This number was chosen based on comparisons to neighboring houses with the same squares.

A general guideline here would be to use a 10% rule. Compare only to homes in the range of +/- 10%. So for a house of 2,000 square feet, you only compare the price per square foot with homes in the range of 1,800 - 2,200 square feet.

The cost, however, can vary greatly from house to house for a number of reasons, as buyers base their final decision on much more than just squares.

For example, take two homes in the same neighborhood, both 2,000 square feet in size. It can sell for \$ 300,000, bringing the price per square foot to \$ 150.
But maybe the second house has been renovated inside, with new cabinets and upgraded appliances. Even a renovated master bedroom bath. Or, maybe the buyers were in a hurry to move apartment, and there was no time to negotiate. So they paid \$ 330,000. For this house, the price per square foot comes out to about \$ 165.

So which number should you use? If you are the seller, you will want to use the highest price. The buyer, of course, will go with the lower number. This is one of the many reasons why it is so difficult to correctly calculate the price per square foot.

### Using an average price

Getting an average price per square foot may be the best way to use this calculation. Instead of comparing the house you are selling or buying to just one specific house, you can calculate the average of the houses in the area, and use it as a point of negotiation.

Use at least three homes of similar size, age and condition, and find the average price per square foot. This will at least give you a guideline regarding the home you are buying or selling.

### How using a price per square meter can benefit you

Despite the potential for varying numbers, knowing the price of a square foot home can still benefit you in negotiations. This is especially true when you compare it to the price per square foot in the local market.

### Selling

Knowing the average price per square foot in your market can help you price your home. If you are in a hurry to sell, for example, you could list below average to entice potential buyers. A lower than average price per square foot can help you even if your home is not new or in good conditions like others in your market.

However, be prepared to have a good reason for a listed price that is above the average price per square foot. If you have made renovations or upgrades, for example, it may be justified to set a higher price.

As buyers, you should know both the average price per square foot on the market and the price per square foot for the house you are offering. It can be a powerful bargaining chip. For example, you could point out to a seller that a house down the street with a renovated master bedroom bath sold for \$ 2 less per square foot, and lower your bid accordingly.

### Should I use the price per square foot to determine what a home is worth?

Price per square foot can be a good guideline. As a seller, you want to make sure you are not pricing your home, and may lose thousands. As a buyer, you do not want to pay above the market price, which could lose you those thousands.

On both sides of the real estate transaction, the best solution is to use the price per square foot as a starting point. From there you can add or subtract as needed, depending on other factors like house age, condition, immediate repairs required and more. The price per square foot is just one part of the pricing puzzle.

Whether you are buying or selling a home, a professional realtor can help you decide on the true value of the home before you set a price or make an offer. The service will help you choose from the leading real estate agents in your area.

### How to calculate the price per square foot for rent?

To calculate a price per square foot, you must divide the total rent for the office or store space by the total usable square areas. For example, if you rent an area of ​​500 square feet for \$ 1,500 per month, you will pay \$ 3 per square foot.

### How do you calculate cost per square foot?

In order to calculate cost per square foot, you follow the same formula as price per square foot. All you have to do is measure the length of the area followed by the width, and then multiply these two figures to get a total square foot (square meters).

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