House prices: The floorplan mismeasurement scandal that’s costing homebuyers billions
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Anyone looking to buy a home has to rely on the property details provided by the seller and the estate agent to work out if it’s worth the money. However, new research has revealed that some of the details aren’t as accurate as they need to be. One company has uncovered a mismeasurement issue which could be costing buyers thousands on their new home.
Pupil, a spatial data company, uses a digital measurement tool called Spec, which produces floorplans that are 99 percent accurate to a property’s true size.
However, the company has discovered that there are huge discrepancies in the way the property industry is costing up homes that go on sale.
Pupil found that one in eight properties measured by estate agents vary by at least 100 square feet from their accurate floorplans – which could mean buyers are paying far more than a property is really worth.
The company claims that the revelation is “bigger than the PPI scandal” as floorplans in London are mismeasured by 54 square feet on average.
That’s the equivalent of the size of a small bedroom or study that’s being added to the value of the home.
The incorrect figures could be costing homebuyers £33,800 per property in the capital, based on price per square feet.
However, it could even amount to overspending by hundreds of thousands of pounds – and the cost of mis-measurement totals £119billion across the capital alone.
The findings were revealed in the company’s Risks and Costs of Mismeasurement in Residential Property whitepaper.
It’s thought that the inaccurate figures are down to outdated measuring methods being used by estate agents in a bid to save money.
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Though some properties had inaccuracies that meant the size was underestimated, the company found that in 60 per cent of cases, traditional floor plans were overstated in size.
James D Marshall, founder and chief executive officer at Pupil, said: “This scandal is misleading buyers, sellers and renters every day, leaving them tens and even hundreds of thousands of pounds out of pocket, and yet so many people aren’t aware it’s even happening.
“It’s time for some transparency and accountability within the industry.”
James said that the inaccuracies were down to photographers often including unlivable areas in floorplans, such as a low-ceilinged loft or a fireplace.
“For far too long, property floor plans have been created by photographers who are not certified and lack the appropriate equipment to produce precise measurements.
“The ‘for illustrative purposes’ guidance simply removes the duty of care to the consumer.”
“When the size of a house is measured inaccurately, the value changes and it confounds the buying and selling process; we have seen it happen too many times,” Marshall added.
The company is now calling on the industry to step up and change the way they measure floorplans.
“There is an urgent need for estate agents to standardise their measurement practices and remove “for illustrative purposes” floor plans across the industry so that people can make a more informed decision about a huge, often life changing decision,” commented Marshall.
The change would mean that buyers “get what they pay for” as the data company discovered people had been cheated into spending more due to the wrong figures.
Checking the numbers could also pay off for buyers if they don’t trust the details they’re given.
Pupil found that one homebuyer managed to negotiate a sale down by £42,000 after he had a prospective property measured using Spec’s 3D spatial technology, and found the property to be 100 square feet smaller than advertised in estate agent floorplans.
However, another homebuyer purchased a home for £2.6million after borrowing money from his bank, only to find out after the sale that the home was mis-measured by 70 square feet – or £84,000 in additional spend.
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