Price/Sqm - Houses

Here's how to estimate the price/sqm for houses.

Jumping off from Monday's post, we'll discuss the "quick and dirty" way of estimating the price/sqm of a house to determine if it's priced appropriately.

Disclaimer: This method entails various assumptions that are highly subjective. Of course, hiring a licensed appraiser will far be superior to this method.

Similar to condos, we must first separate the lot from the improvement.

1. Get the approximate price/sqm by checking "lot only" listings online. Or, if there aren't any, look for listings with dilapidated improvements in the same village/area.

Get the average price/sqm of 3 to 5 listings. As much as possible, try to use listings with similar features as the subject property (not tumbok, perimeter, located on a flooded street, etc.).

2. Then, multiply the price/sqm by the subject property's lot area to get the lot's value.

3. Deduct the lot value from the selling price to get the price of the improvement.

4. Divide the value of the improvement by the floor area to get the improvement's price/sqm.

5. Use the table below to understand whether the improvement is priced appropriately.

This is how much improvements should roughly cost:

15,000/sqm - Warehouse

25,000/sqm - basic structure (bare walls, no paint, no fixtures)

40,000/sqm - mid-end finish (finished with toilet fixtures, paint, tiles, flooring)

60,000/sqm - high-end finish (finished with high-end fixtures)

100,000/sqm - ultra high-end finish (imported tiles, top-of-the-line furniture, elevator, floor-to-ceiling glass that can withstand CAT-5 typhoon)

For example, if you've calculated 50,000/sqm for the improvement of a 30-year-old house with outdated features, then it seems the property is overpriced. If you're doing this as a seller, you may wish to reconsider lowering the price. If you're doing this as a buyer, you may use your computation to negotiate a lower price.

Typically, people who could afford a > 50 Mn property wouldn't give any value for an improvement older than 20 years due to obsolescence or aesthetics. They would rather demolish the structure and put up a new one. And, no, the "buhos" foundation doesn't add any value.