Does size matter? When the modern-day buyer is assessing the value of a property it seems to matter very much. Not so long ago buyers had to rely on estate agents’ sales particulars which provided nothing more than some room measurements, a photo or two and a generous dosage of superlatives. Nowadays the floor plan and the associated ‘price per square foot’ is the most important piece of information that a buyer relies on.
The most common question I am asked by both buyers and sellers is “what are you achieving per square foot”? Such a broad question can only be answered with a fairly arbitrary, but honest answer – in and around Kensington & Chelsea properties are achieving between £700 and £2,000 per square foot, although in some extraordinary cases properties can achieve as much as £4,000 per square foot. I’m not entirely sure such a flimsy response provides a useful insight into the concept of determining value according to space, to do this we must delve a little deeper.
We often encounter resistance from buyers, particularly European and international buyers, who analyse the asking price of the property according to the square footage. When we start to cross-examine the reliability of their information there are often key considerations which have been conveniently ‘overlooked’. First and foremost, the condition of the property must be taken into consideration, has the property been recently refurbished? If so, one should expect to pay a premium.
In the case of flats and apartments the floor level is a major contributing factor to the value; flats on first floors of period conversions almost always fetch a premium because of ceiling height, grandeur and period features. For this reason I have speculated for some years that a more accurate measure would be to calculate cubic feet rather than square feet, perhaps in time this will become common practice?
Then we must assess what areas are incorporated into the square footage, sometimes storage areas and mezzanines are included, should these be considered to be as valuable as primary living space? Other major factors such as how highly regarded the street is and the quality (and aspect) of the property’s positioning should all be taken into account. Perhaps the most surprising factor that is generally overlooked is outside space. How do you value a garden, roof terrace or balcony – we know that for many buyers these are ‘must-have’ requirements.
Finally, in my view, it is the design and layout of the space that is most crucial. In my experience 800 square feet of well configured space can provide a much better living experience than 950 square feet of badly configured space. For those of us who have been around long enough to recall selling a property before the advent of floorplans it was a simple calculation that buyers had to make … Is the property big enough? Can I live there? Will my furniture fit? Perhaps the modern-day buyer might find using these tried and tested questions a helpful sanity check.
Director – Head of Sales, Mountgrange Heritage
Posted: 10 January 2012