Yes, it’s time for real estate agents to start accepting responsibility for providing accurate square footage details to all prospective buyers, other agents and to appraisers who all depend on the data they provide. No agent is required by law to measure a house. But, in most places, “if” an agent provides it, it must be accurate and that means it can’t be taken from tax records.
When an agent meets with a seller to provide a CMA, they can’t do their job properly without knowing the true square footage of the home. We live in a price-per-square-foot world and the vast majority of real estate agents use a price-per-square-foot formula to calculate a home’s value.
While they all understand this simple formula, they are not taught the importance of quality information. Far too many agents (and home buyers and sellers) believe the myth that the local tax department provides the “Official Record” of their home’s square footage. They believe even if the information is wrong, it’s probably not enough to impact the value. Wrong! I can’t stress that enough. 100% wrong. It obviously depends on your location housing styles and ages, and other factors such as home with upper levels and basements (which are the worst offenders). After studying this topic for over fifteen years, I have thousands upon thousands of examples that show just how many and how large the square footage errors are in public records. And remember, the tax department does NOT need precise square footage details. A few lazy Realtors® started using the square footage in tax records in the early nineties and it spread like wildfire.
What it causes is over and under priced homes, low appraisals, and cheats consumers out of millions upon millions every year. Yet the National Association of Realtors® continues to ignore this problem and could easily fix it with one new rule. One rule that requires all Realtor® members to provide accurate square footage details, based on a nationally mandated measurement standard, into every MLS listing. Consumers are currently at the risk of the state they live in, their local MLS system, and their individual agent’s knowledge on this subject.
Maybe this lawsuit in California (Horiike vs Coldwell Banker) will help draw more attention to this matter and bring other attorneys into the action. For right now, until the legal community holds real estate agents liable for providing inaccurate square footage, consumers will continue to get cheated every day. It’s time to bring about a change.
MLS systems all across the country are riddled with inaccurate square footage details, and those details hurt buyers and sellers. Also, any automated valuation model can only be as accurate as the square footage details. They all seem to use the same information from the local tax department. If you use a formula that only uses two numbers and one of those numbers is wrong, all your valuations are also going to be wrong. If $5,000, $10,000, $30,000, $50,000 and much more doesn’t matter to you, go ahead and trust computerized valuations.
However, for a six percent fee, you would make sure your agent measures (or has your home measured) BEFORE they ever calculate a price. Otherwise you can be assured you will be leaving money on the table.
Interesting perspective. First of all, no. It is NOT realtors I work for. I work for banks making loans to home buyers. I am not one of your vendors. Before the growth of online tax records in the nineties as you mentioned, all agents measured and had someone else measure every house. It was part of their job for that six percent commission (Prices go up and agents get a raise, right?). You can hire someone to measure the house even if you know nothing about it. I believe their is no excuse for an agent using tax records and the errors in that data can change prices dramatically. I have about 18 years worth of evidence to show it. And, it’s not the tax department’s job to measure a house to get the information a realtor needs. If you’re going to call shame on me you should know what you’re talking about.
I agree with HMS and I am an real estate agent in southwest Florida. Recently I informed an agent of her inaccurate information of the square footage of her listing. She has included 625 sf ft 3 car garage as living sq ft because of it being air conditioned. She pulled the info from property tax office and it is wrong. Also it is a waterfront home and she has in the mls 70 ft when it is actually 56 ft. That info was not pulled from tax office. The tax office has online measure abilities for the public and easily you can measure linear feet. Even though she has been alerted, she refuses to make the change, thereby hurting the potential buyer and possibly hurting the seller by a possible lawsuits against the seller and the agent for concealment and or conspiracy to commit a fraud for an advantage monetary for seller and agent.
It happens far too often. Thanks for sharing!