How important is price per square foot when comparing properties in the same neighborhood?
Well, it is important to consider price per square foot because it is a factor in the appraisal process. Your lender requires your property to appraise for at least your loan amount and often, your purchase price. The appraiser will use price per square foot as a part of their valuation process so it helps to buy a place that is in alignment with other comparable properties. That said, it is NOT the most important factor in San Francisco home valuation. Unless you are buying in a building or type of building with a lot of similar units (think new construction or lofts), price per sq foot is not that useful. In the San Francisco real estate market, so few homes are exactly alike. Even homes on the same block with the same square footage can have radically different market values. Things like floorplan, natural light, occupancy (will be it delivered vacant or subject to tenants’ rights), condition, location in the building (top floor, garden level, etc) and even how the wind blows on you
