Question 1

What is a good price per square foot?

Accepted Answer

There is no universal answer because price per square foot varies dramatically by location. The national median is roughly $150-200 per square foot, but major metro areas like San Francisco or New York can exceed $800/sqft, while rural areas may be $80-120/sqft. Compare the price per square foot of a property to similar homes in the same neighborhood to determine if it is a good deal.

Question 2

Does price per square foot include the garage or basement?

Accepted Answer

Typically, price per square foot is calculated using livable (or finished) square footage only. Garages, unfinished basements, and attic space are usually excluded. However, listing practices vary by region, so always verify what is included in the square footage number. A finished basement may or may not be counted depending on local MLS standards.

Question 3

Why do smaller homes have a higher price per square foot?

Accepted Answer

Smaller homes often have a higher price per square foot because certain fixed costs like the kitchen, bathrooms, HVAC system, and roof are spread over fewer square feet. A 1,000 sq ft house still needs a full kitchen and at least one bathroom, just like a 2,500 sq ft house. The land value is also spread over less interior space. This is sometimes called the 'small home premium.'

Question 4

Can I use price per square foot for commercial properties?

Accepted Answer

Yes, price per square foot (or per square meter) is widely used for commercial real estate including office space, retail, and industrial properties. Commercial properties are also often quoted in annual rent per square foot. For example, Class A office space might lease for $40-60 per square foot per year depending on the market.

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