Buyers foot for thought.

It was marketing maven, Louise Sunshine, who coined the phrase 'All square feet are not created equal,' and how right she was.

Depending on the method of measuring used, home buyers could be paying up to a 25% premium for non-livable space, according to the city's brokers.

Barnet Liberman, an investor in 122-unit condo conversion, Rutherford Place at Stuyvesant Square in Manhattan, recently came to understand just how tough it is to maintain integrity in the real estate business.

For almost a year, the condominium has been deliberately selling the honest methods they use to measure square footage of new condominiums, setting the tape measurer on the interior wall on one end of the apartment and extending it to the other end of the interior of the room. For anyone who has taken elementary school math, this seems the proper way to measure square footage.

Yet, for developers grappling for precious space in this crowded city, there are other ways to measure. For nearly 20 years, some have chosen to measure new condominiums by beginning foot count on the building's exterior of buildings, at the base of the glass window, masonry, or brick--and ending at the opposite side of the building's exterior.

For the past five years or so, others have been measuring square footage based on even more illusory methods--calculating "gross square footage" by throwing the space of outside areas like the terrace or common areas in the building itself, such as the hallway, elevator, or lobby, into the count.

These practices are all legal and have become so common that recently, a sophisticated client viewing an apartment at Rutherford Place made executives rethink their honest measuring methods. The client was almost sold on the condo, but the price per square foot seemed too high and he worried he might have a problem reselling. When the broker explained other ways square feet could be measured, the client was more willing to buy the apartment.

As a result, Rutherford Place representatives recently decided to conform to the unsettling practices of the industry, and hired a surveyor to re-measure beginning and ending at the exterior of the apartments.

"The king's clothes are beautiful, I have now recognized how beautiful the silk is that the king is wearing," Liberman said, referring to the children's book The Emperors New Clothes where all of the people in a village imitate their neighbors by deceiving a king into believing he is wearing fine clothes when he is actually not.

Developers must clearly state the method of measuring square footage they are using in the buildings offering plan, which must be pre-approved by the Attorney General's office. Yet they may use any method they choose. Beyond that, there are no legal standards or industry guidelines they must adhere to.

This lack of standards can cause an uninitiated consumer to be lead to believe they are getting more space than they actually are. For example, a space which is actually 960 s/f as measured from interior wall to interior wall can be listed as 1,080 s/f measured by the exterior wall method, and 1,200 s/f measured using space from common areas outside the apartment.

Perhaps more importantly, consumers may actually get a raw financial deal. Condominium costs are calculated exclusively through square feet where the calculated price is divided by the square footage of the interior. The larger an interior space is, the lower the price per square foot becomes. When square feet are tallied according to less obvious methods, the price per square foot inside the condominium may seem lower than it is in reality.

Using the previous example, a consumer purchasing a unit measured according to the second method, may pay a 12.5% premium for non-livable space. A consumer using the third method may pay a 25 % premium for non-livable space.

"One building might have an artificially low square footage simply because the actual square footage is suspect," explains Jonathan Miller, president and CEO of Miller Samuel Real Estate Appraisers, Inc.

Liberman is not the only one disenchanted with the standards. Across the board, professionals expressed frustration with the lack of standards for measuring square feet. Some noted the wide swing of square feet reported by architects, agents, developers and others in listings for a single condominium, from different sources over a number of years.

"I don't see any defense for it," Miller said. "For the life of me, I can't come up with a reason why consumers are essentially being mislead."

In response to a number of lawsuits over square footage, some brokers have stopped quoting square footage altogether. Others has chosen to err on the side of caution for ethical reasons.

Luxury brokerage Brown Harris Stevens never does its own condominium measurements, and only quotes measurements when they are written into the building's offering plan.

"We are very careful," said Ruth McCoy, executive vice president and managing director of sales at Brown Hams Stevens. "We're selling apartments, not square footage. We do not have the expertise to measure. We wouldn't do that unless there was some amazing governing body out there that came up with a standard of measurement."

The Corcoran Group has three different ways it checks square footage. First, the brokerage turns to the condominium's offering plan. If the building is an older building, the firm may turn to the original floor plan in the select register. Square footage counts of these apartments can be calculated using any method, but are more likely to be measured from interior to interior. If neither of these methods work, architects are called in to measure each room in the apartment for sale to calculate the net usable space.

"I personally believe we should use the net footage from inner wall to inner wall," said Susan Renfrew, managing director of the Corcoran Group. "That's the actual space. It doesn't help a client who wants to know if their couch will fit in the apartment, how many square feet the exterior wall is."

Nevertheless, Renfrew said the trend for developers measuring new buildings, particularly condominiums has veered towards using the exterior to exterior method. And brokers selling new condos often get their count directly from the offering plan.

"Frankly, I think we brokers just expect that (exterior to exterior count) to be what we get when we are selling condos," Renfrew said.

In today's market, where professionals are not seeing the kind of sales or appreciation that have driven them in previous years, in order to keep competitive, even those who have tried to fight these trends are finding themselves compromised.

"For years we have been making this argument about measuring interior to interior. I thought we were so articulate and clear about what those measurements meant," Liberman said. "It turns out, we were wrong."