When pricing a duplex to sell, the biggest mistake many Realtors who don’t specialize make is calculating value based on the number of finished square feet in the property.
That makes sense with a single family home. After all, if two properties have exactly the same number of bedrooms, bathrooms and garage stalls and are in similar condition, isn’t a bigger house worth more than a smaller one?
What about a duplex?
Well, if you have a big duplex with two one bedroom units in it that rent for $800 a month each, and a total of $19,200 a year, is it worth more than a slightly smaller duplex where each unit rents for $900 a month and a total of $21,600?
Finished square feet only impact duplex value in two circumstances. First, if the size of the either results in the owner being able to charge more rent, then the property generates more revenue and is therefore, worth more.
In the second case, if the duplex would appeal to an owner occupant and therefore, a larger sized unit might be perceived as more desirable.
In neither case, however, should the duplex’s value be determined the number of finished square feet by the average cost per square foot comparable properties in the area have sold for.