From the paired sales example, what is the implied market value per square foot for building size?

From the paired sales example, what is the implied market value per square foot for building size?

• A. $100 per square foot
• B. $50 per square foot
• C. $200 per square foot
• D. $0 per square foot

Answer: (B)

In paired-sales analysis, you isolate the effect of building size by comparing two similar properties that differ mainly in size. The value change tied to size is found by dividing the price difference by the size difference, giving the market value attributed to each extra square foot. If that calculation yields fifty dollars, it means the market assigns about fifty dollars to every additional square foot of building area, with all other factors held constant. The other options would imply no value for extra space or a much larger per-square-foot premium, which doesn’t align with what the paired sales data show.

In paired-sales analysis, you isolate the effect of building size by comparing two similar properties that differ mainly in size. The value change tied to size is found by dividing the price difference by the size difference, giving the market value attributed to each extra square foot. If that calculation yields fifty dollars, it means the market assigns about fifty dollars to every additional square foot of building area, with all other factors held constant. The other options would imply no value for extra space or a much larger per-square-foot premium, which doesn’t align with what the paired sales data show.