I do a fair amount of compiling and reporting of sales statistics for homes in the Tucson Foothills. I show how many homes have sold in one month, one quarter, a half year or year, and compare that to the same period in the previous year.
I compare average and median sale prices from year to year, show DOI (days of inventory) by price range, and generally try to present a comprehensive here's the numbers picture of what's happening with home sales in the Tucson Foothills.
But for some reason I've barely ever touched on one of the most commonly used measurements for determining the market price of homes. $/sf.
$/sf
$/sf is a handy rule of thumb guide to how much homes should be selling for in a particular subdivision or for a particular type of home within a certain area. And we're accustomed to using $/sf.
It's just like going to the butcher and buying meat.
Prime filet is $14.99/lb. You want 10 pounds, that'll be $149.90.
You only want 5 pounds, it's $74.95. Chopped chuck on the other hand is $2.99/lb.
It's usually not quite that simple with homes, but $/sf is a good place to start for a quick rule of thumb guide to prices.
Maybe the average sale price in the subdivision is $1,120,460,
and the home you're looking at is priced at only $890,000.
Does that mean it's a bargain. Not necessarily.
If the average $/sf of homes sold in the subdivision is $247.15,
just multiply that by the square footage of the home you're interested in - which happens to be one of the smaller homes in the subdivision, and listed for $890,000, or, $276.48/sf vs. the average $/sf of $247.15 X 3219 sf = $795,575 - and you have a quick reference of where that home falls on the price spectrum for that community.
In theory it works no matter how big or small the home is. Though all other things being equal, smaller homes within a subdivision generally cost more $/sf than larger ones.
In this example you might be paying for a small filet and getting a sirloin, or there may be a very good reason why that home is at the upper end of the $/sf costs in that community.
Nevertheless, you now have something to go on, and some investigating to do. What, if anything, justifies that price -
new high-end kitchen and baths and new flooring, larger lot, more privacy, better views, all of the above, ..., none of the above.
In most subdivisions in the Tucson Foothills there are many things that can make a home worth substantially more or less than it's neighbors.
But if the price doesn't make sense, you now have a very clear and strong negotiating point to make with the seller.
$/sf, it's kind a like $/lb, Don't pay for filet and get sirloin.
Next on my agenda is to follow up with some $/sf costs for different subdivisions in the Foothills.
see thefoothillsToday.com
to search for and learn more about Tucson Foothills Homes
