Why Not All Square Footage is Created Equal in Park City, Utah
In Park City, some home buyers and sellers believe price per square foot is the best way to determine how much a property is worth. But this idea is more like a myth than a fact. It's a bit too simple and misses out on what really makes a house special. It's like judging a painting by size without considering the artist's skills or beauty.
In real estate, things like where the house is, its design, how well it's built, and any high-end features are important in determining a property's value. The issue is these things don't show up in the square footage. Also, what's happening in the housing market.
So, the price per square foot can give the wrong or incomplete idea about a property's real value. It's important to look at everything about a house: location, style, how new or old it is, and all the special things inside and outside of it to really understand what it's worth.
This is especially true in Park City, where homes & condos can be customized. Ultimately, the price per square foot is just one part of understanding a property's value.
Below, we discuss the four ways that unqualified price per square foot DOES NOT account for, when to use price per square foot and when not to use price per square foot.
Do you think these two properties should use price per square foot to be valued versus one another?
The two homes on the right are similar in size but have dramatically different views, architectural styles, and ages.
1. Location and the price per square foot do not fully consider if the home is within Park City limits. There is a substantial difference in median prices of single-family homes and condos from areas in Deer Valley or out on the outer edges of the Park City golfing communities. High-elevation properties on the top of the mountains tend to sell for more money but maybe less per square foot than a smaller condo.
The price per square foot for a ski home can vary three-fold. Buyers searching for ski-in-ski-out properties will pay more for excellent ski access and to live directly on a ski resort. The location of the property to ski access, Park City School District, and amenities play a factor in the property's value but are challenging to encompass in the price per square foot.
2. Views in the Park City area have some of the best views of recreation. Park City has some of the best views in the United States of recreation areas, such as the beautiful Utah ski resorts. While the buyer and seller determine a view's value, a home with superior views can be worth 20% more money.
3. Architectural style, condition of the home, and age - the more detail, the more the cost. Slab-on-grade (single-story, flat foundation), multiple-story, walk-out basements, regular basements, and split-level homes have their own cost to build. Boxy homes with little detail are much cheaper to build than those with varied roof pitches, curves, or creative footprints.
A great example of style and age is that you'll notice a price per square foot increase in Promontory if the home was built after 2013. At this time, architects and builders started using more glass and steel, which added to the construction cost.
4. Finishes. The surfaces in a home account for a significant portion of the cost to construct. This means that flooring, cabinets, counters, paint, stucco, brick, rock, etc. matter...A LOT. Here is a very simple look at the cost.
- Flooring- Carpet, stone, hardwood, laminates, and concrete vary dramatically in cost. Travertine, for example, can run from about $2.50 per square foot to over $20.
- Woodwork/Cabinets- The type of wood, stain, finish, and detail work factor into the cost. An exotic wood cabinet door can be ten times more expensive than a simple one.
- Counters- Granite is the norm today, but there are several grades of granite, and the more exotic versions can be up to seven times more expensive. Even surfaces like Formica can be very expensive.
- Paint- Multi-tone paint costs more, as do artistic finishes.
- Fixtures- Handles, knobs, plumbing, and lighting - one of the most overlooked costs in a home. For example, a single-bathroom faucet can run anywhere from $25 to $2,000.
- Windows and Doors- Windows and doors come in various qualities, sizes, functions, and energy efficiency and can easily add tens of thousands of dollars to a home's cost.
- Landscaping- One of the most expensive elements of a home. Landscaping is rarely factored into pricing. A lush backyard with a pool can add up to 50% to the cost of a small home.
- Systems- Heating, cooling, plumbing, and electrical all have a wide variety of quality and durability.
When to Use Price Per Square Foot in Park City, Utah
Even though price per square foot isn't always the full story, there are times when it's really helpful for understanding the value of homes and condos in Park City. Here's when you should consider using this metric:
- Comparing Similar Properties: If you're looking at homes or condos similar in style, age, and location, the price per square foot can give you a quick way to compare their values. It's like comparing two bags of apples from different stores to see which offers a better deal.
- Understanding Market Trends: This metric can be useful for getting a general sense of where the Park City real estate market is heading. If the average price per square foot in a particular area is going up, it might mean that the market is getting hotter.
- Budgeting for New Builds or Renovations: If you're planning to build a new home or renovate an existing one, knowing the average price per square foot in the area can help you set a realistic budget. Based on current market trends, it gives you a baseline for what you might expect to spend.
- Evaluating Property Upgrades: When selling a property, the price per square foot can help you understand how much value upgrades like a new kitchen or bathroom might add to your home. This is especially useful in upscale markets like Park City, where buyers often look for high-end finishes.
Remember, while price per square foot is useful, it’s not the only thing to consider. The location, views, architectural style, age, and interior finishes of the property all play a big part in its overall value. Always look at the bigger picture when buying or selling in Park City.
When Shouldn't I Use Price Per Square Foot?
While the price per square foot is a handy tool in many cases, there are situations where it might not be the best way to judge the value of a property in Park City. Here's when you should be cautious about relying on this metric:
- Unique or Custom Properties: If a home or condo has unique features or custom designs that stand out from typical properties, the price per square foot might not capture its true value. For example, a house with custom artwork or a specially designed garden adds value not reflected in the square footage.
- Vastly Different Locations: Comparing the price per square foot between properties in very different locations within Park City can be misleading. A home in a highly sought-after area might have a higher price per square foot than one in a less desirable location, even if they're similar in size and style.
- Major Differences in Condition or Age: Older homes might need more maintenance or renovation, which affects their value but not necessarily their price per square foot. Similarly, a newly renovated home might be worth more than an older one of the same size, but this won't always appear in a simple square footage comparison.
- When Looking at Large Properties: The price per square foot can be less relevant for very large homes or estates. These properties often have luxury features and large land holdings that contribute to their value in ways that aren't reflected in the square footage alone.
- Highly Individualized Finishes and Features: Homes in Park City with high-end finishes, like custom cabinetry, advanced home technology, or artistically crafted interiors, can have a value that the price per square foot doesn't adequately represent. These details can significantly increase a home's appeal and price but don't add to the square footage.
While price per square foot is a useful starting point for understanding property values, it's not a one-size-fits-all solution. It's important to consider the unique aspects of each property, especially in a diverse and dynamic market like Park City. Always look at the complete picture to understand a property's true worth.
Whether buying or selling a property in Park City, I am responsible for educating my clients to determine their property's value accurately. Price per square foot can be beneficial once a substantial portion of the above factors is known and when the homes, in comparison, are adequately evaluated first.
Park City home prices can fluctuate and move quickly based on limited inventory; check out our current market update to find out what's happening with real estate in Park City, Utah.
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*This article was originally posted by Derrik Carlson on Thursday, March 5, 2015, at 10:58 am and was updated on December 16, 2023.Posted by Derrik Carlson on