If you’re buying a home, the listing likely includes the square footage, a key selling point. But if you make an offer that’s accepted and you’ve moved onto the home appraisal step in the process, you might be shocked to find out that the appraiser‘s square footage is different from what’s on the listing. What gives?
Square footage, you may recall, is calculated when you measure how much floor space there is in a home. At its simplest, you multiply the length of a room by its width, then total the rooms together. So how can two different pros come up with different numbers?
While this could sound like someone is fudging the figures, there are some perfectly logical reasons why the square footage measured by an appraiser would differ from what’s on the listing. Here’s why this happens—and how to handle it.
Why your square footage on an appraisal differs from the listing
The difference often comes down to official “living space” versus the total space of the house, says Harold Huggins, a real estate agent with Harold H. Huggins Realty in Burtonsville, MD.
An agent may calculate square footage based on how much living space there is—in other words, areas of the home that are heated such as the kitchen, bathrooms, bedrooms, and so on.
The appraiser, on the other hand, evaluates the total value of a home. That means calculating square footage that includes everything, even an unheated basement, attic, and other nonliving spaces.
This inclusive number should have been recorded by the local municipality when the home was built, says Sandy Straley, an agent in Layton, UT. That’s because it’s used for tax purposes.
How home additions are factored into square footage
Sometimes agents rely on the very same tax record numbers that appraisers do to find square footage. But even then, there could be a difference between the listing and the appraisal, says RJ Winberg, a real estate agent from Orange County, CA.
“This usually happens when someone decides to enclose a patio, finish a garage, or even add on to the existing structure to increase the amount of interior living area without first obtaining the proper permits,” Winberg explains.
If a homeowner skips the permitting process, the local taxing municipality won’t know that there’s additional square footage. That means it won’t be reflected in the property records.
This is why appraisers will also do their own measurements of the property, and they may note a square footage discrepancy. This could end up costing the seller, he warns, as the taxing authority may come back and demand the property owner have the work inspected and permitted, or reverse the work and bring the home back to its original condition.
What should you do if you notice square footage differences?
If you notice a difference in the square footage between the listing and the appraisal, don’t hesitate to speak up.
If you’re a buyer, you may have the right to renegotiate the price or cancel, Straley says. To determine if you can do that, check with your real estate agent, who will know about laws in your state that may give you some wiggle room.
If you’re a home seller and you have some square footage that hasn’t been appraised, now’s the time to call your local municipality to see if a more accurate number can be updated on your records. You don’t want to be caught misquoting that square footage when the appraiser shows up. You may be subject to paying some permitting costs or making some fixes, but extra square footage will likely be worth it in the long run.
After all, “more space is valuable to most buyers,” Winberg notes.
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