The square footage of a home is important when buying or selling a home. It has to be accurate when the home is listed in the Multiple Listing Service (MLS), as the size of the house contributes to the price.

Square footage contributes to the valuation of a home, so an accurate measurement helps when pricing a property for sale. Without an accurate measurement, a seller could overstate the size of the home to increase the value.

Real Estate agents need to know how to measure the square footage of a house or, at the very least, verify public information.

How to Measure the Square Footage of a House

There are a few different ways to determine the square footage of a home. With most home purchases involving a mortgage lender, the importance of the appraiser’s square footage measurement is usually significant.

When conducting a real estate appraisal, an appraiser must find the home's square footage, as the property's size is closely linked to the value.

The American National Standards Institute (ANSI) has guidelines Fannie Mae uses to determine the square footage. Appraisers will use these guidelines to find the liveable space in a home.

Not all parts of the home will be included in the measurement. Only heated rooms finished as living spaces and above ground are measured. The outside dimensions of the home are used to calculate this area.

Without measuring the square footage of a home, there are other ways to find the size. The tax records will show the square footage, often how a real estate agent finds the figure.

However, this record can be wrong, so it is important to verify the size independently. Some buyers will do this as part of their due diligence.

How to Calculate Square Footage

To get the square footage of a home using the exterior measurements, you multiply the figures. If there are two stories, you then multiply by two. So if a home measures 42 feet by 35 feet, the square footage would be 1,470. If the home has two stories, it would be 2,940 square feet.

While this is a straightforward example, things can get very complicated. If the home has sloped roofs, not all of the space will necessarily count toward the overall size.

A room under a sloped roof has to measure over 7 feet from the floor to the ceiling for more than half a room. Any space under 5 feet because of the sloped ceiling will not count as liveable space.

Other parts of the home might also not be counted toward the home’s square footage. Rooms like porches, sunrooms, and breezeways don’t count if there isn’t any heating. Basements will not count toward the overall square footage, as they are below ground.

Some MLS boards allow agents to show basements as part of the "gross living area" so potential buyers understand there is more living space.

Is Price Per Square Foot a Good Way to Assess Value?

It is easy to focus your attention on square footage when looking at the prices of homes. Though the price per square foot is important, many other factors contribute to the value and might be a larger factor.

If the home's living space is the only thing considered when judging the value, other things that could be more important will be overlooked. The age of the home, its condition, features, location, and more all contribute to the price a home can sell for.

The Importance When Selling

When an appraiser uses the sold prices of similar homes to assess the value, they are usually only looking at homes within 20% of the square footage of your home. Using homes outside this range would be difficult to justify, regardless of the other factors.

You also don’t want to overstate the size of your home when selling. If the home appears larger than it is, it will be shown to buyers looking for more space than your home.

Misrepresenting the size could lead to the buyer starting legal action against you if they later find out the home is smaller than claimed.

Final Thoughts

Accuracy when assessing the size of the home is important when deciding the price. But it is only one factor contributing to the price and shouldn’t be considered in isolation.

It can be tempting to overstate the square footage when you sell, but this is a mistake. It will be discovered at some point, and this could cost you.