Comps and Square Footage - Posted by smilin_mark

import · February 19, 2002, 7:44am

Posted by Bob on February 19, 2002 at 14:00:23:

Would you be kind enough to send a copy to me too? Thanks.

import · February 19, 2002, 7:44am

Posted by smilin_mark on February 19, 2002 at 08:44:57:

Does anyone have a good feel for how much square footage affects the value of a home? I have full access to MLS, so I can get lots of information on previous sales. However, quite often the SF is different for the subject than for the comps.

For example, let’s say I am looking at a 750SF 2/1 home. I have four comps in the immediate area that are 1000SF 2/1 homes and they average $80,000. It doesn’t seem like the SF has a one-to-one relationship which would make the value of the subject home 80k750/1000=60k. It’s still a 2/1 home, so I would think the SF has maybe a 50% effect which would make the value of the subject home 80k(750/1000+(1000-750)/1000*.5)=70k. What do you think? How do appraisers adjust for SF differences?

By the way, I do realize that I want to find comps that are more similar than in the example, and that it is not an exact science. But what can I say, I’m an engineer, so I like formulas.

Thanks,
Mark

import · February 19, 2002, 8:15am

Re: Comps and Square Footage - Posted by ken in sc

Posted by ken in sc on February 19, 2002 at 09:15:54:

Great question. As with all appraisal questions, there is no exact answer because appraisal is not an exact science. Here is a good way for you to look at it, based on my experience as a licensed appraiser. I will use your numbers to hopefully show what I mean.

You have comps that show 1000 sqft houses selling for $80,000. Most people would say “houses are selling for $80/sqft in the area” and then multiply $80 times the 750 sqft in your house and come up with a value of $60,000 like you suggest. This is somewhat simple because it implies that the lot has no value, only the house.

A more accurate deduction from your comps would be to take out the lot value (Typically 20-25% of sales price unless golf, water, etc.) and then compute a price per foot of the HOUSE. So, if your comps sell for $80,000 and you subtract $18,000 for the lot value, then you have a value of $62,000 for the house. Divide that by 1000 sqft and that indicates $62/sqft for the house. Now, 750 sqft times $62/sqft plus $18,000 for the lot is $64,500 possible value for your 750 sqft house.

One thought I would give you. Realtors do not measure houses. The 1000 sqft comps might actually be 850 sqft houses and they just guessed 1000 sqft and put that data into the computer. Find out what the tax assessor thinks the sqft is for those comps and you may get some valuable info. On the small houses like this, I would trust the assessors sqft.

I hope this helps. Feel free to ask more if I have confused you.

Ken

import · February 19, 2002, 8:05am

Free Auto-Appraiser Spreadsheet - Posted by NCPaul

Posted by NCPaul on February 19, 2002 at 09:05:54:

I have a spreadsheet that you input the comps and it gives you an adjusted value based on the same factors used by an appraiser. Mind you this is a simplified version but works well for investor purposes. (A lender would NEVER use this grid so an appraisal will be necessary for a loan but for your refrence this is a good tool.) Let me know if you want it and I’ll e-mail it to you. You will need MS Excell to work it.

Good Luck

import · January 15, 2003, 10:24pm

Re: Free Auto-Appraiser Spreadsheet - Posted by Paul (CA)

Posted by Paul (CA) on January 15, 2003 at 23:24:38:

NCPaul, I may be a little late to the show here, but your tool sounds quite interesting and useful. Do you still have a copy that you’d be willing to e-mail me? I’m just starting in real estate and the whole comps process is frustrating me.

Thanks in advance.

Paul

import · February 21, 2002, 6:26pm

Should have sold the darn thing (NT) - Posted by Tony in MI

Posted by Tony in MI on February 21, 2002 at 19:26:24:

nt

import · February 19, 2002, 11:32pm

Me Too! - Posted by Kevin_TX

Posted by Kevin_TX on February 20, 2002 at 24:32:31:

Thanks in advance!
guthrie2@flash.net

import · February 19, 2002, 4:12pm

Re: Free Auto-Appraiser Spreadsheet - Posted by BOb

Posted by BOb on February 19, 2002 at 17:12:57:

Would you be kind enough to share that with me too at
kewlbob69@aol.com
Thanks.

import · February 19, 2002, 10:29am

Re: Free Auto-Appraiser Spreadsheet - Posted by JC (San Diego,CA)

Posted by JC (San Diego,CA) on February 19, 2002 at 11:29:27:

Paul,

How about a copy of that Spreadsheet??

Thanks,
JC

import · February 19, 2002, 10:10am

Re: Free Auto-Appraiser Spreadsheet - Posted by Gambit_NC

Posted by Gambit_NC on February 19, 2002 at 11:10:03:

Paul,
I am from NC too. Could I get a copy of your spreadsheet? THANKS!

import · February 21, 2002, 7:34pm

Maybe. . . - Posted by NCPaul

Posted by NCPaul on February 21, 2002 at 20:34:07:

Actually, that had been brought to my attention by none other than JP! The first version was not automatic at all and would have been a disaster for anybody but an appraiser to use, let alone a newbie investor! This is the third version so far. I figure I need a bit more refinement of the whole thing before it’s ready to get paid for. The investors who use it when I give it away can give me some valueable feedback-finding glitches, etc. Besides, if giving it away to 20-30 people floods the market such that there isn’t a need for the spreadsheet then there really isn’t that much of a market!

Now having said that, I never refused a charitable donation! If my wife and I can get some babysitting lined up, we may poke our heads into the bar at Convention one night-possibly looking for a charitable drink from a thankful auto-appraiser user or two!

Good Luck and thanks for the advice!