What is the impact of a home's square footage on value?

Square footage is one of the most important factors in home value. In general, larger homes sell for more, but the relationship is not linear. The value per square foot typically decreases as homes get larger. Finished basements, garages, and porches are often valued at a lower rate than above-ground living space. Buyers pay the most for the first 1,500 to 2,500 square feet of functional living space.