ANSI Measuring Standard Required in 2022

ANSI Measuring Standard Required by FNMAOn December 15, 2021, Fannie Mae announced that it will be adopting ANSI Measuring Standard in 2022.

Appraisers will be required to use the Square Footage-Method for Calculating: ANSI® Z765-2021 (American National Standards Institute®) Measuring Standard for measuring, calculating, and reporting gross living area (GLA) and non-GLA areas of subject properties for appraisals requiring interior and exterior inspections with effective dates of April 1, 2022 or later for loans sold to Fannie Mae.

For more information, watch this video and check out this fact sheet.

 

Here are some items for appraisers to consider when using the ANSI standard

  • Measurements are taken to the nearest inch or tenth of a foot, and the final square footage is reported to the nearest whole square foot.
  • Staircases are included in the GLA of the floor from which they descend.
  • Basement is any space that is partially or completely below grade.
  • The GLA calculation does not include openings to the floor below, e.g., two-story foyers.
  • Finished areas must have a ceiling height of at least 7’. In a room with a sloping ceiling, at least 50% of the finished square footage of the room must have a ceiling height of at least 7’ and no portion of the finished area that has a ceiling height of less than 5’ can be included in the GLA.
  • If a house has a finished area that does not have a ceiling height of 7’ for 50% of the finished area, e.g., some cape cods, in conformance with the ANSI  Standard, the appraiser may put this area on a separate line in the Sales Comparison Grid with the appropriate market adjustment. The report will be  ANSI-compliant and also acknowledge the contributing value of the non-GLA square footage.

What if comparable sales are measured differently?

GLA for properties in local MLS systems and assessor records may not be ANSI-compliant. The appraiser may not know what method an MLS listing or assessor used to calculate the GLA. Through research and their knowledge of the local market, appraisers determine if the GLA provided through alternate sources should be adjusted. The adjustment process does not change the requirement to report subject GLA to the ANSI standard.

Does following ANSI even reflect the market? Perhaps, adopting the ANSI standard will make the description of the subject property more precise. However, how is this going to help if Realtors, assessors, builders and architects are not measuring by the same standard? Will this create a false sense of accuracy? Will there be a lot more discrepancies once the ANSI measuring standard is used by appraisers for the subject property while the comparable sales are measured by a different measuring standards. And how do we apply the ANSI measuring standard on exterior-only appraisals, desktops, hybrids and 2055s?
 

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77 Responses

  1. Scott Taylor on Facebook Scott Taylor on Facebook says:

    Measure all you want but unless you are going to pay me another $1,000 a job to go measure all my comps and make sure I have access to all comps then this is a bunch of bs. Apples to apples people.

    9
  2. Avatar CJK says:

    The funny thing is FNMAs computer reviews judge use partly based on what the Assessor has for the size. I had one in which all of the comparables were Tri-Levels. The Assessor called one a two-story, one a ranch and one a split-level. So, the size and style were different for all of them when in reality they were basically the same style house. I had a comment in my report explaining this, but FNMAs computer cannot read the comments. So, I received a lower rating on the review because of the incorrect Assessor data.

    I sometimes wonder why do we even need a sketch in our reports if no on even looks at them? FNMA does not really want appraisers anymore they just need form fillers, they want everything to be the same that is why they are redoing the forms, it will make it easier for the computer to read. Appraisers will now be called “data entry specialists.” Our function will be to feed the computer, feed the computer, feed the computer. 2 – 3 more years and I am done with the BS. After 38 years I am starting feel it. It is no longer fun.

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  3. Avatar Jesse L says:

    The appraiser defines the scope of work per USPAP. Hard stop. Disclose, disclose, disclose.

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  4. Chuck Minzenberger on Facebook Chuck Minzenberger on Facebook says:

    The county records in the areas I work in do not state which method they use. I’ve always used the ANSI standard when measuring and used my best judgment on the comps, so no change for me. It’s a good thing the GSEs have finally state unequivocally what they want on this issue

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  5. Avatar JC says:

    Does this mean that FNMA CU appraisal review process will no longer require appraisers to comment on why their gla is different from the public records/assessors gla?

    CU error code FRE1001: The gross living area for the subject property ([GLA] sf) varies by more than [X]% and [Y] sf from public records ([GLA] sf). Please confirm the reported gross living area for the subject property is accurate and adequately supported.

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  6. Virgil Gleason on Facebook Virgil Gleason on Facebook says:

    ANSI has been the standard as long as I can remember, and I started in 1984. Looks like someone is late to the party.

    1
    • Lane Leppink on Facebook Lane Leppink on Facebook says:

      Virgil Gleason that’s exactly the thought going through my head. If Realtors and appraisers and assessors were using a DIFFERENT standard, what would it have been? Since the beginning of time, ANSI was the standard.

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      • Avatar CJK says:

        In my market most Realtors use whatever the Assessor has even if it is incorrect. They have a comment in the MLS that says the buyer needs to measure the house. How many buyers’ agents help the buyer measure the house? On occasion a Broker knows something is off so they will pay me to measure the house for them. But for the most part they do not care. In some listings it says the PR was used, but when I check with the PR the numbers are not even close.

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      • Avatar Brian says:

        Do you honestly think that many county assessors use ANSI standards? I would bet that the vast majority of the assessed calculations are wrong, maybe not by much but they are not compliant with these standards. So how then are you to apply GLA adjustments if that home has not been measured to ANSI standards?

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  7. Avatar Cobra says:

    “The appraiser may not know what method an MLS listing or assessor used to calculate the GLA. Through research and their knowledge of the local market, appraisers determine if the GLA provided through alternate sources should be adjusted.”

    No I won’t be adjusting someone else’s data and be liable for it? Not happening!

    4
  8. Avatar Seneca says:

    So nothing has changed. It’s the way I’ve been doing it for 30 years

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    • Avatar JC says:

      So how do you apply ANSI on a drive-by? How do you measure a 2 story foyer / family room, and how do you know if a cape cod finished areas have a ceiling height of at least 7’ when you are not doing an interior inspection?

      5
      • Avatar Seneca says:

        You don’t.

        “If the appraiser is unable to adhere to the ANSI Standard, the appraiser will provide the code “GXX001 –” in the Additional Features field on the appraisal form and must explain why compliance was not possible.”

        You just add a comment for drive-bys and comparables that it’s not possible without a full inspection.
        Let Fannie Mae sort it out.

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      • Avatar Chris says:

        There are comments in ANSI handbook specifically addressing 2055s and new construction

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    • Avatar don says:

      Some of the houses are older than 30 years Did they RE measure with the standardization?, or what. I know do you?

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  9. Tim Lane on Facebook Tim Lane on Facebook says:

    So, we are now to be going around measuring homes for a drive-by? I don’t think so. My life is worth more than this job.

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  10. Avatar CJK says:

    I have a question about comparables

    If the MLS says one thing and the Public Record says something different which one, do you use? Also, if you know that they are both incorrect what do you do? In some markets buyers do not consider a lower level with above grade windows to be a basement. However, the PR might have it as a ranch with a basement, as a two-story, as a bi-level with both levels together, and sometimes as a bi-level with the levels separated. Why does FNMA believe that the PR with its old and incorrect data must be superior to the appraiser who just looked at the property and included current photos and a sketch?

    Which is more important reporting the market’s reaction or complying to FNMA dictates. If the market says both levels (on a bi-level with above grade windows) should be together but FNMA says they want the levels separated for the appraisal which one is in compliances with USPAP? I just had a tri-level with all 3 levels fully above grade, the PR called the lower level a basement. FNMA used the PR for the review and said that I might have an overvaluation. This was totally bogus; the photos clearly show that the LL was not a basement. So, was I in compliance with USPAP by reporting the 3 levels together? If I came before the state board, what would they use? Would they hit me over the head with FNMA guidelines, or would they say good job, you report what you see?

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  11. Avatar E Brown says:

    I can’t ever remember coming up, in 30+ yrs, with the exact sq ft of MLS or Tax Assessor records. Realtors here only use what Assessor states. Unless they are using basements or rec rooms that have no interior access. Then it’s All In !

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  12. Using the assessor’s standard does not equal using their measurements. Some in this thread seem to conflate those. Using the same standard of measurement for comps and subjects is what is sought. Using one standard for subjects, and another for comps is not credible. Period.

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    • Avatar CJK says:

      So, are you going to personally measure all of the comparables with the same standard that you used to measure the subject? Have fun with that let us know how that turns out for you.

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  13. Avatar E J Brown says:

    So, you figure Realtors & Assessors are going to have to measure each listing to ANSI standards ? I don’t think so.

    I guess they’ll have to take some meaningful education.

    1
  14. Avatar CJK says:

    I sometimes wonder if the people at FNMA know what the hell they are doing. LL-2015-02, page 7 clearly states that “Fannie Mae currently does not have, and has never had, a limitation on a single-line item adjustment.” Last week FNMAs computer review said that one of my line-item adjustments was above 10%. So, which one is it? I had a comment in the report about the adjustment, but FNMA does not read the report before they give a warning to the lender and a low score to the appraiser.

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    • Baggins Baggins says:

      CU 1-5 risk ratings are going to jump. It will bring even more flags for inconsistent comps modeling. I’ll fail to provide bracketing size, excess comparison by size alerts will be constant. This is the most idiotic proposal I’ve seen in 20 years of real estate. One size does not fit all. What about a large bi level with a full basement? Shall I report a 2 level basement where basement is twice the size of agla credited space?

      Every single report if dealing with garden level will now spark probably at least 10 new EO risk alerts on both the appraisers review software and the lenders. If the goal is to slow appraisers down, confuse consumers, and provide reasons for more regulatory complaints, FNMA hit a home run with this one.

      Question; Do you think zillow, trujilla, and every other data aggregate in this country will apply that standard as they auto map auto import existing assessors data? Will the VA panel adopt this standard? Will HUD also adopt this? NAR? Listing agents? Unlikely. This is interference with professional standards and commonly held performance expectations. Someone at FNMA needs to be fired immediately.

      4
  15. Avatar GB says:

    Complete theft of housing value. Many homes have bedrooms in their older style cape homes where the ceilings are less than 7′. My house for example is a 1.75 story home and has 2 bedrooms on the 2nd floor with a ceiling height is 6′ 9″ and is approx 1750 sf. I have just lost 750 sf of living area in my 1940’s cape and 2 of my bedrooms. Now I have a 1-bedroom house. This is insane, since 1940, my house has been a 3-bedroom, den, kitchen, dining room and living room house, now I have only 1 bedroom? How do I know if the comp I am using has that extra 2″ to make it a 7′ story? Guess my home is going on the market before April. Can’t afford to lose my square foot or bedrooms to this stupid new rule. We have entire houses built in the 1800s and 1700s that don’t even have a single story that has 7’… then what? A non-square foot home? I guess it will no longer conform to Fannie Mae? What a nightmare! I thought people hated me now… wait until I tell them they have no bedrooms and their GLA is half the size.

    4
    • Baggins Baggins says:

      This will create systemic deficiencies in FNMA CU data, excess stipulation and revision clarification requests. If assessors and builders routinely omit stairs data.

      Model matches will not be model matches anymore. Full 1004 service will result in different agla sizing statements. Repeat service will have us magically stating different sizes.

      The previous FNMA standard was something with market standard and best logical reporting for uniform results.

      For people whom think this is no big deal, consider yourself fortunate. There are entire counties where ANSI does not apply. I run a customary simple sketch to verify; ‘generally accurate assessment records’.
      We have entire neighborhoods that consist of only bi and tri level homes, some with actual basements, others not. Garden level is agla state wide in Colorado! They built hundreds of thousands of homes with garden level and equivalent above grade quality for sump pits, water tables, soil conditions along with structural stability concerns, and energy efficiency reasons in the high country. They are often priced marketed and sold equivalent to 2 story units. ‘Typical’ reporting is garden level as agla. Am I supposed to speculate how much agla to cut out of comparable bi’s and tri’s, attribute that to basement and adjust it at a different cost basis? Garden level can literally consist of 1/3rd to 1/2 of the homes total size!

      4
      • Avatar don says:

        Years ago my mentors paced off the size of both the subject and the comps. Our Governor was petitioned and supported county wide publication of Records for Counties over a Million. Realtors used to compete in guessing the size, several tried to include the overhang. Lots of stuff happened, It’s better now, but it still takes effort.

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  16. Avatar Truett Neathery says:

    SO, appraisers now will have to hang their hats on comparables that were 1. Stepped off by an agent. 2. What the owner said. 3. Calculated from an erroneous sketch. Sounds like applying science to an essentially emotional buyer and seller experience !!

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    • Avatar don says:

      My mentors were appraising in the 1940’s were you. Are you among the WOKE where you base an argument on contradictions and absurdness? Most truths have contradictions, many liars won’t include a basis because they fear or are too lazy to allow others thoughts

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  17. Avatar Richard Troyer says:

    I have used the ANSI standard for 18 years and it is an excellent way of standardizing measurements. I have completed many 2000 field review reports and am apalled at lazy appraisers who copy the tax records measurements. We are to be credible in our reports and this is a good step in the right direction. There has been too much variation in SF measurements of properties due to laziness and inconsistent measuring standards. I was an estimator for commercial general contractors and know that incorrect measurements can cost someone a lot of lost money, especially as a contractor.

    1
    • Avatar Brian says:

      So how do you adjust for GLA knowing that the comparables have not been measured to the same standard? Say the difference is only 200 sf, at $50 that is still 10 grand and a 200 sf difference or a $50 adjustment are pretty small!

      1
  18. Avatar Mark Anderson says:

    Realtors and home builders developed ANSI standard. Ask a realtor what it is and you will get a blank stare. Fannie allows variance for walkouts. Assessor and realtors in my market consider finished walkouts as gla. Apples to apples.

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  19. Baggins Baggins says:

    Hi Don. Thank you. Please educate me on the terms; ‘paced off’, and per below Mr Neathery’s statement of ‘stepped off’. Are those the same terms? Never heard that before. Please explain.

    Private size records sounds like an insurmountable challenge. In CO we generally have easy access to assessors size and they’re reliable the majority of the time. I’m concerned about ansi in CO because half of all my homes appraised are bi’s or tri’s if in the sf det housing segments.

    I think the bi level with full basement (3 total floor levels) is a good example of how ANSI is going to cause more problems than solutions. Am I to report two basement levels and adjust them each with a different basis? (the garden basis matching agla because it is agla per ‘the market’ & ‘common approaches by assessors realtors and buyers’, and then the lower cost typically associated with actual basements.)

    In CO suburbia I never bothered with ansi and it’s not very common to see other appraisers using it either. Such an inflexible approach would have every single comp falling outside of bracketing size against my subject, even if they are model matches, since I’d use assessor & MLS data for comps, but would use ansi for subject which would be an entry contrary to assessor and contrary to the mls listing. Even private sketch requests for pre listings would fall outside of FNMA ANSI dictates so even sketches won’t match if those are present which is getting common for agents to upload either a prelist or builder spec floorplan. The FNMA appraisers sketch will never match what could be a total of 4 or even 5 different other data sources; assessor, mls current & previous, pre list sketch, known builder floorplan data.

    It is going to confuse everyone and they won’t understand why I’m using such a nonsensical approach, apparently refusing to be on the same page as everyone else. This inflexible rule stinks of incompetency. (see links I posted at top of this conversation thread for the traditional more sensible alleviation work arounds we have enjoyed up to this point in time.)

    I read a hundred pages on this just recently, including annoying AF threads. I can see why some support the standard but it just does not make sense from a perspective of seeking to achieve lower risk scores and fewer automatic underwriter tool alerts in areas with prolific multi levels. The common standard for the past 60 or so years has been to report garden partially below as agla space. Multi levels are overwhelmingly common in the 60’s to 2000’s stock in CO.

    What is normally an internal EO review alert count as low as 8 or 10 in my Alamode software and lenders review software will jump to like 20+ because I’ll get fire alerts for all comps out of range, excess size differences, failure to bracket size, excess size comparison differences, and depending on how I adjust basement, other excess net/gross adjust alerts. What was a 1 FNMA risk score will become a 3 constantly if not worse. This is such a short sighted dictate from a reviewers and risk management perspective. I guess just memorize this and repeat ad nausea with disclaimers; GXX001.

    I’ll have to try and push everything through ‘true’, and if they don’t accept it, will have to include screen prints of my grid prior to ANSI rule meddling and rev requeists. Providing at least a clear illustration I did not intend to submit an apparently incompetent report but was requested to due to these arbitrary inflexible rules on stating subject size. I’ll then shake my head in disbelief when I’m asked for more comps to bracket the agla size.

    It would be even worse and actually incompetent if I were to guess at what agla size I should be reporting for comparable selections like another tri or something (trying apples to apples and guessing at ansi compliant sizing for comps without any reliable data source to get there as sketches and per each level size indications are not always public data). A tri can have anywhere from a fifth to over a third on the lower garden level, and some bi’s can be variable too.

    There should be an exception for split level homes. Am I about to ‘step off or pace off’ if I start guessing like this, is that what it means? FNMA is acting like it owns the market and can direct everyone else. Selling guide needs to have appropriate flexibility, the hardline approach is the wrong approach.

    5
    • Avatar Truett Neathery says:

      Real-a-ters measure by walking around the foundation, Close enouph.

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    • Avatar ej says:

      Excellent comments, Baggins. Fannie Mae is basically asking appraisers to produce misleading appraisal reports. My question is: where are the Appraisal Organizations?

      4
      • Baggins Baggins says:

        Thank you ej. A lot of great ideas and points came out of this thread. And then I zingered it by highlighting how the selling guide has conflicting data. The selling guide even says that in some cases the below grade should be reported as agla. I bet the person whom is imposing this ‘mandate’ for reporting strategy is one of those covid believers too. There are a lot of people whom are now propagandized to the point they no longer utilize logic or reason but rather have become accustomed to following commands and barking orders. Enough with the mini dictators, I do what I want and what I think is right. I’ll continue to report in a manner consistent with the local market. What are they going to do put me on FNMA probation? Enough appraisers will be using this code that they’ll have to rescind.

        Obviously there is a high probability for a conflict of interest here. Taking bets now if the person issuing this has stake in some hybrid deal or amc companies, or is even aligned with selling us ansi books. It’s another evil plot to make appraisers purchase appraisal related books we do not want and do not need. Where is the cosmic cobra breeding ground guy, he’ll back me up!

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        • Avatar Seneca says:

          “I bet the person whom is imposing this ‘mandate’ for reporting strategy is one of those covid believers too”

          Dear Lord Baggins. Just stop it.

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    • Avatar don says:

      Pacing and stepping may cover different issues. When Legg length enters in, individualism prevails, as does individual-independence. Territorialial knowledge could be important and explainable

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      • Baggins Baggins says:

        Thank you. Upon further reflection, tri level with basement is the example, not bi. Sorry.

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        • Avatar Brian says:

          Actually, in my area, both have below-grade areas that the assessors include as GLA which the Realtor then uses in the MLS record. I have been struggling with this for years now, I am required to record this area as below grade but I am not to correct the MLS record? It might be wrong but I’m an apple to apple guy, when I can clearly see that the record is wrong that area will be removed and noted in the basement section with plenty of comments of how and why.

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          • Baggins Baggins says:

            https://selling-guide.fanniemae.com/Underwriting-Property-Projects/Appraisal-Requirements/Appraisal-Report-Assessment/Improvements/1069008161/What-is-included-in-the-square-footage-calculation-for-gross-living-area.htm
            Brian, that’s the updated ridiculous guidance, subject of this thread.

            https://singlefamily.fanniemae.com/media/21821/display
            Control+F to bring up the keyword search bar tool.
            The keyword you’ll want to enter is; consistency

            ‘For consistency in the sales comparison analysis, the appraiser should compare above-grade areas to above-grade areas and below-grade areas to below-grade areas. The appraiser may need to deviate from this approach if the style of the subject property or any of the comparables does not lend itself to such comparisons. For example, a property built into the side of a hill where the lower level is significantly out of ground, the interior finish is equal throughout the house, and the flow and function of the layout is accepted by the local market, may require the gross living area to include both levels. However, in such instances, the appraiser must be consistent throughout the appraisal in his or her analysis and explain the reason for the deviation, clearly describing the comparisons that were made.’

            I would highlight the conflict of guidance suggestions here as well. ‘The appraiser must be consistent’, which means if you have two bi levels, one is reported half agla half bas, the other is reported all agla no bas, but they are the same model same total size of home, you must make a call and adjust data to report them and adjust them in a consistent manner. Then you turn to larger market area research for similar housing and you observe which reporting method is most common, also double checking with assessor direct to see if agents have altered reporting strategies in MLS. The end goal is consistent reporting across the board and not getting nutty by reporting two identical homes in a dissimilar manner. Your primary ‘requirement’ is ‘credible reporting results’, which is absolutely prioritized above arbitrary compliance with some data which may be conflicting and lead to ‘misleading reporting.’ Consistency, consistency, consistency.

            Builders lead the way as they initially build and then report sizing information to the county departments which after permit compliance & build inspection compliance, then report the size to the assessors. The assessor or the building code department or one of them will dictate how the builders should be reporting size to them. It’s normally a logical point but also detailed zoning coding guidelines which are county specific and vary county from county may dictate certain minimum height or depth requirements to qualify garden level vs basement. In the real world most garden level is half half up/down and nobody arbitrarily calls that a basement because it is well understood a basement must be nearly completely below ground but usually peeks a foot or two up for a small bas window or room for window well. Being a few feet dug in does not make it a basement, give me a break.

            Don’t get too caught up in trying to do something differently or comply with every bureaucratic rule, and no, you would not ask MLS to correct their size records if the record is taken directly from the assessors database which size usually is reported that way, they just copy the size figures. Every time I’ve observed sizing variance in MLS vs assessor, it’s always trouble. I am not inviting that into my reports which I am liable for. Just took some classes too; remember appraisers can be subjected to civil and criminal penalties. Good luck explaining in civil court why a completely different sizing standard was applied to your subject which was not applied to your comps, it’s an open invitation for getting sued if people disagree with your value opinion. Target on the back argument.

            The ansi rule applies to the appraisers reporting on subject but would not be applicable to all the comps who’s assessor reported sizes did not utilize ansi standards? Especially with tri levels, are we to guess at the lower third level size amount we should be removing and reporting in another line for our tri level comps? We may have that measurement for subject but would not for comps. And we’re not going to ‘step off’ that sizing guess of comps. This is why we’ll have to get used to using the exception code. GXX001.

            Apples to apples makes sense to us but is too generalized of a description of the problem to be a defensible argument. If you get a client whom throws a fit about the use of the exception code, direct them to this specific selling guide language. Actually, may be a good start to the prewritten explanation about why the code is being used, refer them back to their own selling guide. Typical bureaucracy, one hand does not know what the other one is doing. We’re from the government and we are here to help.

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  20. Avatar Kenneth Smith says:

    Called the county Assessor and asked if they used the ANSI standard when measuring homes. The reply was, never heard of it.

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    • Avatar Truett Neathery says:

      Our county assessor in Placer County, CA came from the Personal Property space. Probly not familiar with ANSI or measuring buildings, either !

      1
  21. Avatar Patrick Abandy says:

    In terms of a drive-by, I don’t believe that you have to measure the subject and that’s why it is called a drive-by. If the lender wants a measurement, then the lender should order a full appraisal. In addition, I don’t also believe that a home owner will allow you the appraiser to measure the home which is used as a comparable because the home owner doesn’t know who you are and at the same time does not want to put the family’s safety in jeopardy. I will not allow a total stranger to come and walk around my home in order to satisfy the ANSI rule.

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  22. Avatar koma says:

    If enough of us do not adhere to this it will crash their systems and we’ll see how fast this is retracted. I will be moving forward with the standard that has provided my reports with credible results for the past 15 years.

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  23. Avatar Koma says:

    Just did a little research and found out hybrid appraisals (I do not do these) are being completed using ANSI measurement standard. Hmmm I wonder why Fannie Mae is making this a requirement?

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    • Avatar don says:

      Use price as a method of comparison, it is a common item and frequently arrangeable as a, MEAN MEDIAN, or MODE. There can be many ways that price can vary, some even suggested by the lenders.
      The ANSI. rule is too awkward for we sophisticates.

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      • Baggins Baggins says:

        One time a manager served me but good for having used price basis for research. You want to stay away from that if possible. Although proof is possibly in the price, it’s still important to utilize other investigative methods to come about comprehensive data which brings good price alignment. You’ve got to back into it because price does not always equal value. Damn, 20 years of saying that…

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    • Baggins Baggins says:

      Koma you know the funny thing about that… All these tech companies and amc’s pushing hybrids copy static language, similar to how they all copied scope of work and engagement guidelines. They may state they’re using such a process as ANSI. Then they’ll just turn around and import the readily available assessor and MLS data, which of course, may not be ANSI compliant. It’s all automated data mapping to form fields for maximized efficiency. Ask them questions about regulatory structure or the details of what their disclosure language actually means and they will be unable to explain it. I used to really have a good time catching these companies and people tripping up on their own generic approaches. Then I got tired of educating a constantly rotating staff of telecom workers and abandoned amc work completely. Cheers.

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  24. Hello, I’ve been appraising for 22 years. I have worked directly at Fannie, Freddie and HUD. I have help create policies, and the HUD 4000.1. One thing I have learned in all this time is these originations have got to stop trying to shift the blame to appraisers. Some Genuis at Fannie thinks by invoking Square Footage-Method for Calculating: ANSI® Z765-2021, that every appraiser is going to NOW measure the same house at the same GLA. (WRONG) not going to happen!! Instead of trying to change the appraisers, why don’t you impose stricter mandates on builders. YES, they have the blueprints, make it mandatory that this information is listed in County records with a copy of the sketch. Then the appraiser uses this. (Duh) If not; here is what’s going to happen. WWIII, Yup Between Sales agents, appraisers, and lenders alike. Sales agents ARE NOT going to use this new standard when listing a home, neither are builders, and therefore they are going to miss price the home by comparing them to larger homes, especially Cape Cods. Then, when an appraiser comes in and does use the new standard and pulls comps that are much smaller than everyone else was thinking, and the value is much lower (explosion)*** So for all you brainy acts Remember A modo we had in the Army (KISS) Keep it Simple Stupid. If an area of a home that is above grade is livable and heated it’s GLA. Even if the ceiling height is less than 5 feet. It’s cost money to insulate, run plumbing, electrical, drywall etc. It still cost money to put a roof over this area, a child’s bed or dresser will still go against that wall. There may still be hardwood flooring wall to wall or expensive carpet etc. Whoever came up with this has no idea of what they are starting. I review appraisals now for that past 8 years, and I have while at Fanni & HUD. The different things I’ve seen will shock you, NOW you want to ask some 75,000 appraisers across the nation to add heated are with ceiling heights of less than 5 feet to make it an extra line item on the sales grid. And who’s to say how much on this adjustment??? Another saying we had in the Army; This is going to be a Charlie Foxtrot!!!

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    • Avatar Brian says:

      I couldn’t agree more! The longer I am in this business the less I know, very frustrating. After 20+ years I wish that someone would show me a matched pair let alone enough matched pairs to support any adjustments. And now I am to further complicate the process, on a positive note, it might bring to light the fact that we have been making unsupported adjustments on data that can’t be proven as factual for many years.

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      • Baggins Baggins says:

        Oh no! Don’t say that. LOL. You know the support lies within the adjusted value indicators and their alignment with each other. Follow the rules of bracketing and you can’t miss, even in complex scenarios. If one just takes the time for very careful logical comparable selection, everything you need to support adjustments lies within the relationship of those few market examples. Everything you need to successfully defend the value conclusions and determine reasonable adjustments lies in the competency of comps selection and the adjustment grid itself. ‘Narrowly aligned adjusted value indicators’. What more proof do you need?

        It’s all old hat and the stupid things the non appraisers keep doing is the only excitement left. You will be required to use this standard! That is somebody begging to be ignored and become instantly irrelevant. There is no quicker path to losing support than to bark out mandates to everyone in sight and tell people they no longer have personal choice options. I do what I want.

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  25. Avatar JD says:

    Hummm think I’ll plan my retirement party in April of 2022.
    I am IN control of WHAT i DO. I am NOT in control of the “comparable sales” I USE!

    May as well IN this pool of ____….ADD the following: HYBRID / BI’ Forms: IF I am PART B, the signer of the Report (following 5 years of liability) HOW am I to KNOW, the PART A was measured at all MUCH less by using ANSI ?? IS this the best THEY could come UP with ??? JUST like back-when EVERY Appraiser needed a CRIM-check! Or when DISTANCE GEO’ was THE BIG deal, so your client would NOT send you an assignment >10 miles from your business address BUT you resided ____ miles away. THAT was a really stupid one… like I only know market w/n 10 miles. LOL! WHO are these Idiots?

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  26. Avatar Seneca says:

    Article that asks questions and gives some solutions…..but not quite.

    https://appraiserelearning.com/fannie-maes-big-christmas-surprise-ansi-required-in-2022/

    So by one of his examples. do you make two adjustments for sq ft since you can’t extract out the attic sq ft in the comp?

    Subject Comp
    GLA 1000sf 1500sf -$10,000
    Feature 500sf 0sf +$10,000

    Do you comment that staircases in a two story home in this market is typically 80 to 120 sq ft. Then state you are using an extraordinary assumption that the comp has 100 less sq ft than what is stated. Then state “in order to meet ANSI the appraiser is subtracting the stairway sq ft from the comp in the grid”?

    Got this email today but haven’t listened to it yet.

    https://appraiserelearning.com/the-appraisal-update-podcast/?goal=0_ea97ed434d-9cef02a541-15568401&mc_cid=9cef02a541&mc_eid=4996d3394d

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  27. Maybe all of us appraisers should retire and let the Genius that are coming up with the new crap (square foot method) etc. let them leave their comfy desk and go out into the field and actually do the work. Let them take countless hours of CE, pay the ridiculous MLS, E&O and appraisal software fees. Let them be responsible for the report for the next 5 years. And then maybe, JUST MAYBE they will screw their heads on straight. Can I get an Amend?

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    • Avatar Koma says:

      Martin, I think that’s their main purpose. Get everyone to use the same method then their systems will have enough information to cut us out. Would love to see the catastrophe if/when that takes place.

      On another note, just joined with another local lender that keeps their loans in house. They do not even require UAD. Sweeet! Retirement can’t come soon enough.

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  28. Baggins Baggins says:

    Please refer to the Fannie Mae ‘standardized property measuring guidelines document’. I have this printed next to my computer. ‘Is there an exception to the process? If the appraiser is unable to adhere to the ANSI Standard, the appraiser will provide the code GXX001 in the Additional Features field on the appraisal form and must explain why compliance was not possible. ‘ A few months from now most appraisers will have memorized this numerical sequence, get used to typing it in; GXX001.

    So for split levels, Fannie will get less property information rather than more as we’ll have to occupy this limited 2 line data entry field with static opt out language and referral to yet another disclosure disclaimer pre written field entry which we’ll either have to place on pg 3 or addenda. That’s too bad because that field is commonly understood by people whom actually understand appraisal reporting, to be reserved for a summary line of the subject homes features and amenity.

    Some lenders will push back because in order to keep FNMA CU systems risk scores low, they do constantly seek fewer underwriting exceptions as a rule of thumb. Day 1 systems are likely to alert every time appraisers seek to push this exception through. It will be the appraisers responsibility to comply with uspap and not provide a misleading report. This will simply have to be something lenders get used to because appraisers are not allowed to push misleading reports under our regulatory structure. Remember as Mr Towne said; ‘uspap only applies to appraisers’. It is our professional licensing responsibility to adhere to ethical standards and must either alter scope of work or decline the assignment if we are instructed to provide misleading reporting content. Forming an illusionary fictitious agla number which omits assessor reporting, ignores realty agent reporting, and may change both adjustment and cost approach basis figures for the omitted ‘below grade’ area in question certainly seems to qualify as a misleading conveyance of real property data.

    Also remember that the scope of work is not dictated by a client (in this case; lenders ordering FNMA appraisal products on FNMA forms under FNMA selling guide guidelines). The scope of work is a mutual engagement which it is the appraisers ethical responsibility to form in an acceptable manner before accepting engagement and eventually completing the assignment. The appraiser can not claim any liability protection or regulatory exception by claiming the client dictated they provide misleading reporting content. Quite the opposite in fact.

    The tech workers riddled in every ancillary sector throughout the appraisal industry do not understand these concepts. They labor to increase efficiency and profitability of the process for their uses and their intentions, enjoying the absence of any individual licensing or personally applied regulatory requirements, as tech systems development is not a very well regulated industry. It’s a free for all and many just try to impose what they want upon appraisers, while simultaneously not being qualified to work with appraisers in the first place.

    Protecting the public trust is not a priority for the myriad of companies seeking to profit from licensed appraisers efforts. Regulated appraisers provide a check and balance. It is our responsibility to slow these companies down or choose not to utilize their products or methods if they direct us towards operational or development methods which may diminish the reliability of our appraisal work products. They seek whatever they are seeking. We seek ethical compliance. A clearly defined scope of work is the bridge which allows us to work together.

    This is yet another example of why these decisions should not be left in the hands of tech people or non-licensed managers. Another example of why failing to hire enough licensed appraisers on the management side results in poor outcomes. A consequence of the ongoing abuse of the appraisal industry as we are exploited by tech companies and unnecessary third party injection on all sides.

    Lenders whom have failed to hire qualified actively licensed appraisers will be left at a disadvantage as they bungle the process and errantly presume they can force the appraisers acceptance of a scope of work which ultimately results in misleading reporting content. Much time and effort will be wasted, clients may be lost, increased appraiser liability will be the result for appraisers whom fail to utilize this exception and demand the lender client accept the ‘exception to the ansi measuring requirement’. Sorry FNMA, after some reflection, I have formed the opinion that in many situations adhering to this guideline may result in misleading report content and could expose me to professional liability. GXX001.

    Feel free to form some pre written disclaimer content and post here for others to use. It will be like the intended user debacle and eventually FNMA may issue ‘acceptable language’ or just rescind the demand entirely once they realize such a voluminous portion of reports are utilizing this exception code.

    Don’t go whistling past the graveyard as you throw in the towel just yet, just memorize the exception and get used to using it. Form defensible arguments and language why you must insist and will not be able to continue engagement if they reject this alteration to the scope of work regarding ANSI compliance. Some appraisers will have to use this, others will not, it will depend on the nature of housing and assessors policies in your area. As noted in above commentary from all the blog participators, you have all the talking points needed; Assessor does not use it, agents do not use it, comps alignment issues, valuation analysis basis changes, fictitious data, misleading reporting, etc, etc. Thank you for reading the Appraisers Blogs.

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  29. Avatar JD says:

    ANSI Z765 can be downloaded for $25. https://www.homeinnovation.com/z765.

    QUESTION: Where is the FREE version & WHY do we have to PAY?

    The ONLY updates are member & copywrite edits. Source: psa@ansi.org January 6, 2022.

    1
  30. Avatar Gordo says:

    I used to use ANSI standard, about 30 years ago. That was back when we had measuring tapes. I discovered that rounding to the nearest 1/2 foot was just as accurate. The measuring tape cannot measure to the nearest .1 foot, because it bends, even more so on 50 foot plus walls.

    But now they say “Now you gots dem lazers”

    LOL, I hate to break it to you, but lasers are not more accurate. I measure each wall twice, and rarely come up with the same length both times. Since I round to the nearest 1/2 foot, it didn’t concern me. Now I got to measure maybe 3 or more times, and hopefully they are with .1 foot of each other

    1
  31. Avatar Raymond says:

    Hmmm….interesting comments. After 39 years in the profession, it still amazes me how little control appraisers have over their own profession. We have non-appraisers telling us how to do our appraisals. Meanwhile, our profession continues to be fragmented from within. Ol well, like other professions, at least technology has made a significant impact.

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  32. You know what’s really funny about this new ANSI square foot method. Two things. 1 All during Covid Fannie, Freddie, HUD, VA were all accepting drives-bys, or desk-tops. No one cared??? Even as of today, Fannie/Freddie still accept Hybrid appraisal where Non-Licensed appraisers are allowed to make the site visit, including measuring. Now tell me who full of S##T????????????????????????????? NUMBER 2, We are all still going to use comps where the GLA does not or did not a hear to this new standard. So, what more important, the size of the subject or the comps that we use to value it by ?????????

    1
    • Baggins Baggins says:

      When I refinanced earlier this year, chose the no appraisal option (as my otherwise really great CU regrettably uses an amc), they stated ‘avm alternative option’, but then ordered a hybrid value report which was completed by a realty agent. Public records and realist data, just basically an integrated copied avm value, with bpo like drive by photo service, relayed through an amc of course. Sadly, I fed an amc anyways even though I tried not to. MB said you should do these, we order a lot. They seem to miss the point of what an appraisal valuation opinion service is, and what it is not. Ten years into separation from loan production rules and most mortgage bankers have a decreased understanding regarding uspap ethical implications and requirements. Most new appraisers don’t understand the process as intricately either. Separation from loan production still stands as a regulatory gift and windfall to amc’s. And according to the volume of helpful suggestions from appraisers outright disregarded by Home Innovation (formerly a national builder advocate, now vertically integrated with fnma & the green product sales movement), it would seem that Home Innovation really does not care what appraisers have to say either. Did FNMA people even read this document before pushing this new mandatory measurement requirement? Probably not.

      Seriously, take a minute to read through this. Pay attention to the committee roster, objection comments, and volume of denials.
      https://www.homeinnovation.com/-/media/Files/Standards_Development/Square_Footage/2020_Z765/ANSI-Z765-Update-Public-Comments-Report-PCR.pdf

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  33. Avatar cotton says:

    ANASI? Sounds racist!

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ANSI Measuring Standard Required in 2022

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