Buyer, You'd Better Verify

Posted by Dave Fratello on Thursday, January 10th, 2008 at 4:50am.

You'll see boilerplate language in every home listing saying "buyer to verify" all information.

And you should, though verifying some details – like square footage – won't usually occur until a deal is made and you're at the inspection stage. Then, if you've got a sharp inspector or appraiser, someone may notice that some listing data was inaccurate.

Whoever takes an interest in 528 6th St. (click for details via Redfin) had better ask for the verification up front. Because there's a pretty great discrepancy between the square footage listed when the home was built and sold 2-3 years ago and the number found in the current listing.

Right now the home is said to offer 4168 sq. ft. However, when it was sold in Feb. 2006 – one year after it was completed – the size was listed as 3321 sq. ft. Click here for the old listing info, and here for the current listing. (Click the little graphic for a snapshot of the listing; we're putting this in just in case the sq. footage changes later.)

Records held by the city of MB definitively establish the square footage at 3305. The home was newly built in Feb. 2005, and there have been no additions since then. Simply put, the 4168 sq. ft. figure is wrong – high by 25%.

To be fair to the sellers and listing agent, this 4168 sq. ft. figure is exactly what the county assessor shows. (Click graphic to enlarge; see the bottom-right portion.) Can't we trust gubmint sources for stuff like this? No, apparently not. In fact, we're told the assessor makes mistakes like this more often than we'd like to think.

How does the error affect the potential sale of 528 6th? There are some obvious answers, but here's a key consideration – the price per square foot right now looks like a relative bargain at $827/PSF. When 528 6th first hit MBC's radar (see "6th St. is Turning Over"), we compared this home against two others on the same block, each of which had a PPSF near $1,000.

If we recalculate the PPSF for this listing, which is currently asking $3.449m, it jumps to $1,044/PSF. Now it's average or a tad high, no longer the bargain. Could that affect a deal? Sure. And what if the buyer only discovers this issue after escrow begins? That's a mess.

MBC has made 2 inquiries to the listing agent, asking for an explanation of the discrepancy. No reply. Too bad. The listing needs to be fixed ASAP.
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