What Do Potato Chips and Price Per Square Foot Have in Common?

I’m going to say something slightly controversial:

Price per square foot is overrated.

Let me explain it with potato chips.

The Chip Test

Imagine you’re at the store.

• A 14 oz bag of chips costs $4.79.
  That’s 34¢ per ounce.

• An 8 oz bag costs $3.99.
  That’s 49¢ per ounce.

Same brand. Same flavor. Same ingredients.

But the smaller bag costs 44% more per ounce.

Why? Because smaller quantities almost always carry a higher unit price.

Now let’s bring this into real estate.

The Real Estate Version

Picture two homes in the same neighborhood.

Home A
4 bed, 3 bath
2,000 sq ft
$800,000
= $400 per sq ft

Home B
2 bed, 2 bath
1,200 sq ft
$650,000
= $541 per sq ft

Same neighborhood. Similar finishes. Similar condition.

Yet the smaller home has a much higher price per square foot.

Does that mean it’s overpriced?
No.

It means unit pricing changes with size.

Why Price Per Square Foot Can Mislead You

Price per square foot is a quick reference tool. But it’s not a valuation strategy.

It doesn’t account for:

• Location within the neighborhood

• Lot size

• Layout and usability

• Natural light

• Upgrades and condition

• Street desirability

• View or proximity to amenities

And here’s the big one:
The first 1,000 square feet of a home are more valuable than the last 1,000.

Kitchens, bathrooms, and primary living areas carry more weight than marginal extra space. That’s why smaller homes often show a higher price per square foot.

When Is Price Per Square Foot Useful?

I use it only when comparing two properties that are nearly identical:

• Similar size

• Same neighborhood

• Similar lot

• Similar upgrades

• Same property type

Even then, it’s my final comparison factor — not my starting point.

The Bottom Line

Price per square foot is like price per ounce on a bag of chips.

It gives you context.
It doesn’t give you value.

If you price your home based only on price per square foot, you risk overpricing or underpricing — and both can cost you real money.

If you’re curious what your home is actually worth in today’s market, I’m happy to break it down properly — not just by the math, but by the story your property tells.

Because real estate isn’t sold by the ounce.