As people call for greater transparency in the real estate industry and its practices, one of the anomalies that continue to slip beneath the radar is the reporting guidelines surrounding the square footage of a listed property for sale, especially in condominium sales.
Currently, a seller can state an approximate estimate of their property’s square footage (to the best of their knowledge) and that estimate will then translate into a wide-spread range on the Toronto MLS listing for potential buyers to review. The trouble here is not only the ambiguous figure that is being used in the marketing materials but the possibility that this range is incorrect – with little to no repercussions to the seller agent if this is the case.
A condo is a housing commodity that is generally priced and traded on a price-per-square-foot basis. That is how potential buyers and their agents will ascertain a property’s value, especially in a scenario where a property is set up for multiple offers (listed at a very low price).
Why is it that when listing a condo on the Toronto MLS, it is acceptable to list a property for between approximately 500 and 600 square feet, as an example? Often many of these properties can be far less than their approximate advertised range. The purchaser may be completely unaware of the exact size or price per square foot that they are paying.
In some instances, due to the lack of guidelines, consumers may intentionally be misled. While it is the sellers’ and agents’ responsibility to ensure it is stated that the “measurements are to be verified”, this is not always explicitly stated.
Currently, there are no guidelines in place to require a seller or their sales representative to provide third-party verification of the exact square footage of their listed property. What is even more interesting is that as the sizes get larger for condos listed on the Toronto MLS, so does the range for stating square footage. As an example, anything below 1,000 square feet has a 99-square-foot spread (for example, 400 to 499 s.f.) while properties listed over 1,000 square feet move into a 200+ s.f. spread between ranges (1,000 to 1,199 s.f., for example).
Can you imagine walking into a developer’s showroom to find they are charging $1.4 million for a pre-construction condo that may range between 1,200-1,400 square feet? That would be ridiculous, wouldn’t it?
The Greater Vancouver Real Estate Board’s MLS does not utilize the square-foot “range” at all and as a result, all its listings uniformly state an explicit figure. While this figure can still be an estimate from the seller, the measurement is typically accompanied by a note as to whether the measurement needs to be verified.
As more people search for properties online and call for greater transparency, wouldn’t consumers and the Toronto real estate industry be better served by stricter guidelines surrounding the disclosure of the exact size of a property for sale? I believe we would all be better served and hope this is something we can start to see soon.