it is the baseline. They used to use replacement costs, but those are so extreme
these days that price per sq ft is the standard. Yes there are differences, but the biggest cost in houses is the 6 sides, not the interior or exterior stuff. I've actually heard a discussion with contractors on how the lower the price of the four walls, it was the most costly part and has the most trades mess with them. If you can reduce the four walls cost you can build a home for far less.