Mar 4, 2011
I was up late last night looking around my desk trying to find the secret to the universe or at least, real estate. I am not one that really likes convention. Most of the time I try and figure out a new or just different way of looking at things. For example why do we look at price-per-square-foot and not price-per-bedroom? Bedrooms at least have legal occupancy limits. Why not cubed feet (volume) of a home, that would directly relate to heating and cooling. Why square-feet? That information is often inaccurate anyway.
I have long since wondered why the real estate industry uses price-per-square-foot (p/sqft). That is as arbitrarily as saying price per bedroom. We are certainly not talking about $/sqft it cost to build it. Price per bedroom in many ways makes more sense. Most if not all home buyers know how many bedrooms they need. One maybe smaller than another but if it is still a bedroom who cares. If ($/sqft) worked 3, 4, and 5 bedroom homes would all have the same $/sqft. Now before you call me crazy, I understand that a 3 bedroom home is not a good comparable for a 4 bedrooms home or a 5 bedroom home, but they should be.
Most municipalities have occupancy limits on homes that specifically mention bedrooms. Lets say the rule in your area state no more than two adults per bedroom. So a family of 4 would need two bedrooms. Any thing over that is just gravy. Sure the kids can have their own rooms if we can afford it. Do you want the outdoor kitchen or your kids to share a bedroom? So, I must look for homes that have at least two bedrooms. So we should know how much bedrooms cost.
At this point every house has a kitchen, living room, den, ect.. Those are all kind of standard items that you have to have if you buy a house. What really is only different is number of bedrooms and bathrooms. So I ask the question why price-per-square-foot, what do you think? Comment below and let me know if you think I am crazy or maybe onto something.
About Ed Neuhaus
Broker and founder of Neuhaus Realty Group. I started working in real estate as soon as I could push a lawnmower and help clean up investment properties for my parents. Investing in real estate has always been a passion and now I have turned that passion into a way to help others. Buying and selling homes for others is just one way I think I can make the world better. No sales pressure, no gimmicks, just an honest work ethic gets the job done. Let me know how I can help you. Give me a call today at 512.366.3720
