ANSI Measuring Standard Required in 2022

ANSI Measuring Standard Required by Fannie Mae. On 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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804 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.

    39
    • Avatar Koma says:

      The assessors in my areas do not use this standard. Matter of fact I think it is only 3 states where it is a mandatory requirement. I myself do not like the standard.

      12
      • Lane Leppink on Facebook Lane Leppink on Facebook says:

        Koma, what standard of measurement do the other 47 states use? If you’re not a fan of ANSI, how would you prefer to measure a home’s area?

        2
        • Avatar koma says:

          The American Measurement Standard. I don’t now what the other 44 states use. My mentor taught me this and the dozens of others he trained starting back in the early 80’s. This is what I prefer and will keep using.

          4
        • Avatar mike says:

          We measure to the nearest 6 inches (appraisers standard) minus trim or extended walls. all other standards are similar to ANSI. The problem with the ANSI standard of nearest inch or 1 tenth foot is most houses are not perfectly square due to settling and other factors by using the nearest 6 inches it can be adjusted an inch or two to make the house square and if you have a lot of extra sides or angles on one side with additional thickness of trim and angles and a strait wall on the other it can be a foot different from one side to the other. (Using the strait wall for total length would be best.) So, the nearest 6 inches minus trim thickness seems to be a better standard. 4 inches minus trim would round up to 6 inches and 3 inches minus trim would round down to an even foot.

          3
          • Avatar don says:

            Measuring an outside wall to an outside wall is wider than the Inside to the inside wall, also look out for the thornbushes, they also add unwanted width. Measure all four, or more sides and adjust, Appraisers are allowed, Engineers or Architects, maybe not.

            0
            • Avatar Van Wolslagel says:

              I’ve been at this 45+ years. This is not the first time some institution has tried to standardize home measurements. My reports will now simply state; Appraiser has measured the subject under ANSI methodology. Appraiser cannot warrant that comp’s reported sizes were measured under the same method. Further explanation of livable area are made in the comparison sales comments.

              I can see this is going to be very interesting in the near furure.

              Oh Well, it is what it is.

              Van Wolslagel
              Chief Appraiser
              THE APPRAISAL WORKSHOPPE CO.
              Appraisals & Inspections since 1972

              8
              • Avatar Thomas A Temofonte says:

                I like this blurb. Will use something similar.
                This measuring standard isn’t really much different than how we all should have been trained anyway. Banks have been very cooperative, too.
                It will be the private requests that owners will argue I would guess (lower ceilings, gabled walls, etc).

                0
            • Avatar don says:

              Read “Mansions”, a supplement to a National publication. This publication stresses uniqueness, style, privacy, appealing to Architects, and ignoring costs.
              Production housing is supported by builders, realtors, architects, small governments, and small communities, looking for efficiencies and reduction of costs.
              Can we rate appraisers to ONLY Californicated developments?

              0
          • Avatar Van Wolslagel says:

            hey Mike !

            more reason for me to GET OUT OF LENDER WORK.

            4
          • Avatar Chris says:

            Nearest 6″? What if the builder did that? How hard is it to use ACTUAL measurements. I have been for the last 28 years and have had no problems.

            5
            • Avatar David Spurlock says:

              because MOST houses are built to the nearest 4 FOOT increment, as it costs more to cut material down to something less, and all building codes and materials are designed to accomodate that. 16″ on center exterior wall studs fit evenly in 4′ increments. Plywood, the material of choice in modern roof sheathing, is 4′ wide from the factory. Styrofoam insulation panels, too. T-111 exterior siding is as well.

              1
    • Avatar ej says:

      Do not submit to these dictatorial mandates that put even more liability on the appraiser. We are not architects or home builders. We value property. Hopefully, the AGA will condemn this charade quickly.

      17
      • Baggins Baggins says:

        https://cdn.recolorado.com/files/helpcenter/Square-Footage-Companion.pdf?

        So rich to be able to post this. Especially after so many posters on this page were slinging mud and pushing fallacy and false accusation. Come again? It’s not over yet.

        From the Corelogic Matrix MLS system none the less. Claiming RESO compliance! Let’s ask FNMA whom is more authoritative, the RESO group or the ANSI residential measuring standards work group.

        * A bi-level house does not typically have a basement. All three fields should be the same

        Someone should put the RESO group, FNMA, and the ANSI group together so they can clean up this tremendous mess they just made. I’ll bring the broom and popcorn!

        Apparently MLS is not even bothering with the ANSI standard. This document published today; 04/13/2022.
        ++++++++++++++++++++++++++++

        Square footage is calculated based on three required fields in REcolorado Matrix. Use this guide to help you determine the correct entries according to REcolorado Rules & Regulations.

        !Above Grade Finished Area (SqFt Above): Above grade and partially above grade finished square footage.

        !Living Area (SqFt Finished): All finished square footage of the property, including the basement if finished.

        !Building Area Total (SqFt Total): All finished and unfinished square footage of the property, including all levels and the basement. The total area within the structure. Building Area Total includes only the primary building. This excludes garages, decks, etc.

        !Basement Yes/No: Indicate if there is a basement or not. Below Grade Finished Area and Below Grade Unfinished Area are calculated automatically based on the previous field entries.

        Basement: Indicate features of the basement, including Full, Partial, Standard/Interior Entry, Garden Level, Walk-Out Access, Unfinished, and more.

        !Indicates a Required Field
        +++++++++++++++++++++++++++++++++++++++++

        Oh boy. We’ve got problems.

        1
    • Scott Taylor on Facebook Scott Taylor on Facebook says:

      plus is this the real issue of “bad appraisals”? I would think comp selection should be addressed more than if I missed 200 sq ft of GLA. And according to EVERY agent that 200 sq ft is valued exactly as the the other 2500 sq ft of the house. Who comes up with this crap?

      10
      • Avatar ej says:

        These idiots at the GSEs are trying desperately to improve their database to get better outputs for their AVM. The problem is they don’t know WTF they are doing. All this is a scheme to put all of us out of business.

        39
    • Avatar Gordo says:

      If a closet has a 6’10” ceiling, I am now required to measure all of the closets and subtract them from GLA, but then double dip the measurements of the stairway

      FNMA is becoming useless

      8
    • Avatar sean Joseph poulk says:

      I just do my job and report on the data that is obtainable and verifiable via a reliable source. If the realtors or assesors are incorrect in their reporting then that is a “them” problem. We are able to put very specific disclaimers and explanations of data verification and reliability within our reports and this is sufficient for the CYA requirements. I have been to court and hauled in front of “The Man” and argued these and other discrepancies and had issues dismissed. You are not committing violations or fraud if you are utilizing data from real estate professionals and you make it clear as to the limitations and lack of control you have over data reporting and accuracy of your peers and associates. Just “Chive On” and quit worrying about the industry, we all have much bigger problems, China, Russia, Joe Biden and our corrupt illegal federal government…

      32
    • Avatar Kevin says:

      Completely true. The courthouse, the listing agents, none of them measure to this standard, and we’re lucky if they even measured walls accurately at all.

      And it is insane to try and adjust for square footage that’s below 7 feet, anyway. What does the market think of sloping ceilings?…that you can generalize, but the market is not looking at specific square footage of below-7′ living area.

      This nonsense will require specialized equipment and two people to measure the exterior of even a standard ranch house, given that bushes and other obstructions will need to be avoided (sometimes impossible), and someone will need to hold the target for the laser measuring tool, or a stand will have to be used, where both the target and laser are kept at the same height with respect to the walls of the house, to avoid losing or gaining inches due to angle.
      And my notice on this stated condos were exempt from these standards…general appraisers opting themselves out of unreasonable requirements, while single-family appraisers are dumped on?

      And does anyone’s market, out there, even use GLA as anything other than a general requirement to determine which houses they want to consider buying? Most markets do not consider much past a “small, medium, or large” house, just as they don’t consider the difference between a full acre parcel or a .9 acre.

      Whoever is requiring this tripe has clearly never done this job before.

      0
      • Avatar Chris says:

        “This nonsense will require specialized equipment and two people to measure the exterior of even a standard ranch house, given that bushes and other obstructions will need to be avoided (sometimes impossible), and someone will need to hold the target for the laser measuring tool, or a stand will have to be used, where both the target and laser are kept at the same height with respect to the walls of the house, to avoid losing or gaining inches due to angle.”

        You are joking right? I have been measuring this way since 1994. I have had no problems with it at all. I am able to measure a “standard” ranch to an extremely com custom house alone. All of these obstructions have ALWAYS been around and it is easy to work around ESPECAILLY with laser measuring tools. This is where they really help, you dont have to go in the bushes nearly as much. I have always been able to hit some sort of target. Unless you are pointing the laser at a crazy angle you dont have to worry about “losing or gaining inches due to angle”. Besides the good lasers have a function that will give the level measurement at almost any angle you hold it on.

        0
  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.

    32
    • Avatar Danny says:

      You and me both brother!

      2
    • Avatar Douglas Kues says:

      ….and just a small step further, and logic says that if agents, assessors, or property owners are not also both using and proficient with the ANSI system…. that all other sources will likely be reported with greater square footage than per ANSI standards. Unless such sources are to be permanently eliminated as “reliable” then it would seem that market reaction to differences will work against the subject in virtually all cases. In addition, if FNMA is going to continue to skim data with consistency a mandatory factor, would it not seem that virtually every appraisal from here on out will be rejected by Fannie for lack of consistency?

      Wanna really scratch your head, think deeply about the Fannie requirement that a solar system cannot be considered in final value if: 1) It is leased; 2) it is financed in any other circumstance that the original purchase money financing arrangements; or 3) there is some binding provision that the secured company or lender cannot foreclose on / repossess any of the solar system components in the event of non payment. So….. unless the subject solar system on the subject is free and clear, and the lender/client can prove it, the property being appraised might as well be without solar at all. In addition, since there is really no possible way to determine “comparable property” solar system status (using the same criteria) then effectively there is no verifiable market reaction to financing of any kind, and forever foward there is no verifiable support for the value contribution of a solar system of any capability at any cost and however effective.

      1
      • Avatar Thomas Baldwin says:

        FNMA = ‘Peter Principal’

        They have promoted themselves to a place where they are collapsing from the weight of bad decisions. They need a new script and a scapegoat.

        The script is a fairy tale. The scapegoat antagonist as usual is all appraisers. Of course the protagonist /
        savior is FNMA.

        Turn sound off, it’s only music to distract. No narrative
        https://fanniemae.qumucloud.com/view/Gr6xh2x39AI1zQwixnxToA/sidebar/attachments

        FNMA should really take a long hard look at ERC and it’s methods, forms, etc.. They would not be playing in this bizarre fantasy sandbox if they had done so years ago.

        4
      • An appraiser always told me “nobody is that good”! If an inch or two or rounding to the nearest foot will make a difference in your value, then you are fooling yourself as to how good of an appraiser you are.

        15
    • Avatar Dan says:

      Yea I have one like this, 3 houses the same size. One states 1056 SF, one 2112 SF and the other, 1576 SF.

      0
  3. Avatar Jesse L says:

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

    12
  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

    3
  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.

    8
  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.

    8
    • 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.

      3
      • 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.

        4
      • 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?

        6
      • Avatar BA says:

        The ANSI Standard for Home Measurements was ” First LAUNCHED” in April 1996 .
        ANSI is the non profit organization for the voluntary standardizing of many things. American National Standard Institute.
        ” The American National Standards Institute is a private non-profit organization that oversees the development of voluntary consensus standards for products, services, processes, systems, and personnel in the United States. The organization also coordinates U.S. standards with international standards so that American products can be used worldwide.”
        The organization was not founded for the purpose of measuring the GLA of residential properties and are not aware of the problems that the Association’s adopted and promoted uniform measurement system creates on anything with as much diversity, state and local requirements and personal needs or preferences as Residential Real Estate in both construction and valuation.
        There is much more to accurate valuation of Real Residential property than simple standardized measurement. Market Reaction can not be Standardized IMO. What is acceptable and even preferred by one individual does not always meet the needs and wants of another.
        The organization has no experience in the area of Appraisal valuation and/ or market reactions to residential properties. While uniformity and standards may be very beneficial in the Manufactuing of switch plates or after market auto parts or many other manufactured items, Many Standards can not translate into items that have always been and will always be as individual and unique as homes and residential construction,
        Residential valuation and marketing is just as diverse as human beings in many ways. Not all men can be described as 5’8 to 5’10 and not all homes GLA can be stated as Always only above ground or always 7′ ceiling height. And we , no one can have a STANDARD unless everyone involved adopts the same method.

        1
        • Avatar Van Wolslagel says:

          We have sent FNMA a similar information blog, but they refuse to acknowledge they have made a whopper of a mistake trying to make an apple taste like a banana.

          0
  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!

    8
  8. Avatar Seneca says:

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

    5
    • 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?

      10
      • 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.

        6
      • Avatar Chris says:

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

        1
      • Avatar chris says:

        How do you know if a cape cod finished areas have a ceiling height of at least 7’ …..Interior photos….or Look at the sale from outside and use your appraiser skills you are already supposed to have, call the realtor….LOL

        How do you apply ANSI on a drive-by?….you don’t, you use whats available to you and make statements and disclaimers.

        1
    • 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?

      1
      • Avatar Kevin says:

        Many of the houses we do are in excess of 100 years old, the construction was barely measured at all, and most of the architecture was built by eyeballing the lengths and distances.
        Still better construction than modern cardboard housing.

        0
  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.

    4
  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?

    5
  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 !

    7
  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.

    6
  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.

    3
  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.

    4
    • 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.

      8
  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.

    12
    • 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!

      8
      • 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.

        1
    • Avatar Steve says:

      I’m an Underwriter. Fannie states that “appraisers should include rooms located in above grade finished non-GLA areas in the room counts (Total Rooms, Bedrooms, Baths) in the improvement section and in the Sales Comparison Approach grid to comply with Uniform Appraisal Dataset requirements.”

      In other words, move the non-GLA square footage to a separate line on the adjustment grid and give it a value (if warranted) and continue to count the bedroom or bathroom in your room count (even if that space is not included in the GLA).

      Fannie also says “when there is a finished area that does not meet the ANSI minimum ceiling height requirements, the additional square footage MUST be reported on a separate line in the adjustment grid and a market adjustment applied, if warranted. We require the appraisal report to account for ALL OTHER SQUARE FOOTAGE that is not included in the GLA.”

      This is less about “removing” square footage (Fannie wants every square foot accounted for) and more about categorizing it differently on the grid for uniformity. If your adjustments for the separate line item (non-GLA areas) have a market value equal to that of the GLA square footage, it will be a wash.

      Adapt or die.

      0
      • Avatar Chris says:

        Steve….Well said !!!

        0
      • Baggins Baggins says:

        Naaaaaa Steve, that’s no good, because you still drive up the gross adjustment indicator, even if you balance out the net.

        Try this method instead, as detailed in this post way way way down at the bottom of this page. I had the dreaded tri level w/ basement, 4 total levels, and came up with a great solution.

        It should be considered incompetent practice to drive up anything with false net/gross indicators. That’s not a practical suggestion, although it seems to be the go to suggestion from many an appraiser on this board. It is where the mind goes first, the first logical conclusion. We are forced to adjust it out, so just in turn adjust it back in elsewhere.

        But then you’re left wondering about net/gross indicators and their fundamental importance to be truthful expressions of similarity and or dissimilarity of comparables. It is an illogical thing to think two relatively similar houses should have gross adjustments that high, yet zero net adjustments. It reads like some sort of clever appraisal trickery or fraud. Try this instead.

        https://appraisersblogs.com/solving-the-ansi-measuring-dilemma-a-simple-work-around#comment-34587

        Basically I ignored ANSI, filled grid normally, ran a pdf copy of both grid pages, uploaded them into the report. And then field locked my size adjusts after applying ansi to subject, but not applying ansi to comps. I ran all zero’s for size in the size adjust lines, left room count and room adjusts the same, and then applied my size in a lower line item. Exact net/gross match between the two reports. So I complied with ANSI technically, while snubbing the requirement and I never did apply any size adjusts along the ‘ansi method’. I hopped and stepped over the issue and ignored most of this incompetent non negotiable no opt out ansi dictatorial crap.

        This whole illogical approach of parsing size out in ways not recognized by the local mls, not recognized by local people, not recognized by the municipal building codes which the assessor prescribes, it’s all hogwash. Whomever thought that was a good idea in places nobody else uses this standard is clearly incompetent. Appraisers are supposed to conform to and understand their municipal building codes in their local jurisdictions. To practice otherwise is a clear indicator of incompetency. So there are better methods to suggest.

        The riddle is: How to find a work around without effecting the net/gross indicators…. I came up with than answer though.

        And now FNMA is in violation of Dodd Frank Reg Z, by applying pressure to the appraiser and disallowing our own independent judgment. Wow I thought only lenders could apply that type of unethical hardline absolutist approach to appraisers, turns out FNMA supports pressuring appraisers despite resistance from those appraisers. We have people at FNMA whom have no respect for appraiser independence, and they’re making new rules which harm appraisers credibility and ability to make independent judgements. If there was an appraisal hotline up, I’d call and report FNMA and the ANSI group. ANSI should change their web page, there is nothing voluntary about this.

        The most illogical rudimentary juvenile approach of saying above grade is a literal term. So stupid. Above grade is a general term meant to describe fundamental character and appeal. It takes a special kind of person to call a garden level a basement when all market data, local MLS guidance, and local municipal building codes say otherwise. A more sophisticated approach is what many jurisdictions use, which is recognizing a perimeter and volume based approach when it comes to defining what a basement is or not, qualifiable building area attributable to the generally above grade portions, etc. I’ve never met anyone in my entire life in Colorado whom mistook a garden level for a basement. Because we do not live in a two dimensional world.

        Anyways, I’d bet underwriters are dealing with the aftermath of this incompetent guidance too. Seriously, think about suggesting my method. It’s very simple, requires only simple explanations and it’s basically just directions to scoot your size adjusts down to lower lines, and field lock the adjust areas those size adjusts normally go, enter zeros there instead. Scan in the report prior to doing that so as not to confuse the reader. It’s a clever function within the appraisal software to be able to field lock and over ride warning errors. Regardless though, warning indicators of size different jump in the final report which is xml readable because that’s what FNMA wants, the appearance of incompetent appraisers. Whomever pushed this as mandatory at FNMA should be fired for incompetency and violations of appraiser independence rules. It’s like they are clearly doing it wrong, on purpose. That’s gross incompetency. We all get to clean up their mess. Just fyi, I’m being critical of FNMA, not you. Thanks for participating in this thread. The ANSI mandate is a boondoggle of epic proportions.

        Good ideas do not require force.

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        • Avatar Chris says:

          Baggins…No one cares about net/gross adjustments anymore, so why do you ???

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          • Baggins Baggins says:

            Chris stop being a flaming egotist and speaking for everyone at once in a blanket extra extra extra extra extra ordinary assumption.

            Nobody cares about net gross anymore? Do you even hear the words that come out of your own mouth? All the traders, all the mathematicians, all the assessors, all the tax collectors, the educators, the students, the stock market, the business analysts, the budget planners, pick any given department, the entire world just magically decided we don’t need reliable math anymore. You people are lost in an illusion. Wake up. Net gross does matter and nothing you or fnma say will change that.

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            • Avatar Chris says:

              Baggins… You’re going to lose all your clients if you keep up this absurdity. And I would rather not lose you on this forum.

              One more time my friend, nobody cares about net and gross except you.

              And I am still wondering why.

              And who are you referring to as you people ?

              Do you think there’s a big conspiracy against you, or is it that you’re just afraid they will notice you are using dissimilar comparables to write your appraisals?

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              • Baggins Baggins says:

                And now you somehow believe that appraisers whom understand valuation theory are going to lose clients? That’s not what my managers said when they dealt with appraisers whom drove net/gross sky high for no good reason other than to comply with ANSI, despite nobody else in their local jurisdictions doing so.

                Some people have provincial views where they can’t see the big picture of complex systems. Because if I was a portfolio manager or somehow involved with billions of dollars in mortgage securities; simple reliable references regarding appraisal development competency, like let’s just pick one out, the net/gross indicators. Who needs those?

                Only in your own mind am I the only one out there whom believes in compliance with local municipal guidelines. Go ahead, take that position with the inspector, the treasurer, the tax collector, the sheriff. See what happens.

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        • Avatar Steve says:

          I admit, I’m not an appraiser. I’m learning a lot about the appraiser’s perspective on here. But Fannie doesn’t care about the gross adjustments. In fact, Fannie says “Fannie Mae does not have restrictions on gross, net or line item adjustments”.

          I know this is painful. It adds a lot to my plate as well, as an underwriter, but the pesky underwriter conditions (in response to Collateral Underwriter conditions about GLA being “materially different from other appraisers”) that appraisers receive all the time now will, in theory, start to become less frequent if the entire industry moves to one standard. It will take years for old appraisals with old measuring standards to flush out of the system but GLA and non-GLA should become more consistent and transparent and uniform from one appraiser to the next as time passes.

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          • Avatar Chris says:

            Steve..Well said again….

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          • Avatar David Spurlock says:

            Are you kidding? Do you have any idea how many people out there can’t use a measuring tape? Or have no concept of spatial awareness?

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            • Avatar Chris says:

              David….Are you really trying to say appraisers don’t know how to use a tape measure???

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              • Avatar David Spurlock says:

                In 36 years of appraising and reviewing our peers work, I have seen all kinds of things. The most frequent has been appraisers not noticing that their subject property is landlocked

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          • Baggins Baggins says:

            No Steve, you’re drinking the cool aid. “The industry”. Um… You mean specifically appraisers. Because ‘the real estate industry’ where I am at, does not use ANSI, and they probably never will either. The industry, except for the realty agents, except for the MLS groups, except for the assessors, except for all the buyers and sellers. So no, ANSI in these areas will not cause anything to be more consistent or transparent, in fact this is going to confuse the hell out of everyone and make the appraisers look incompetent.

            Net/Gross is a valuation concept which is used well beyond the appraisal industry. I suppose we’ll be special retarded cases in this matter too, and defy all known analysis rules regarding net/gross indicators being the most absolutely important measurement indicators of similarity and dissimilarity. Oh because Fannie said that does not matter, throw centuries of mathematical theorems out the window.

            Give not one single care about one single entity trying to reform the wheel. Not going to put square tires on my car. A garden level IS NOT A BASEMENT. Perhaps FNMA should finally acknowledge the issue of the problem of appraisal management companies, excessive outsourcing, and do their frigging jobs and utilize the CU system to kick appraisers off approval lists if they can’t do something as simple as…. Drumroll…. Become competent with the LOCAL STANDARDS IN PLACE IN THEIR LOCAL COMMUNITIES.

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            • Avatar Chris says:

              How is a standard to measuring followed by every appraisers result in inconsistency? If all are measuring with this same standard every house measurement by any appraiser should result in a very consistent total GLA. Are you lead by what real estate agent say? Who cares if the agents dont “adopt” ANSI? Agents are out to sell and will add anything in as “GLA”, list any area as a room (closet-deck-patio) just to make it sound bigger, add in basement size into the GLA and say it has a full basement then in the next sentence say ” large crawl for storage. Thats who you look to for “accurate” info? Prior to this I would see more than 1 sketch of a house with very different total living areas because most dont know how to measure and or dont care. In fact there are many who are so stupid and lazy that will use an assessors sketch, when available, in the report and pretend they took the measurements. These are the ones who need to be weeded out. Why do you protest, you now have to actually do your job?

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              • Avatar Chris says:

                Chris .. well said. Baggins seems to care more about people who have nothing to do with the appraisal process, then the ones that actually do.

                70% of my appraisals are bi levels and levels for one reason and one reason only… The lenders cannot rely on assessor data, therefore they need appraisals and appraisers who can think instead of just using imported data and analytics.

                Otherwise you’re just a form filling monkey like so many I reviewed.

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                • Baggins Baggins says:

                  We’re back to being form filling monkeys and cheating on sketch duties. Keep reaching. Well at least you’re coming around to the argument that we can’t competently perform appraisals from different states with the same high degree of certainty as in person. Tell me when you’ve actually seen an appraiser pretend to measure like some appraisal theater. That imported data spoken of actually prevents all the shenanigans agents would use. Which is how in areas where we use such tools and respect local municipal guidelines, and qualify the accuracy of then utilize reliable standards and measurements from the assessors office, we’re not against the wall with pervasive levels of wild west anything goes methodology and potentially incompetent or deceptive agency pertaining to accurate size depictions.

                  So appraisers should stay aware of codes and compliance for everything involved in the process, except the sketch. Permitted additions, unpermitted additions, improper improvement applications that may be subject to tear down orders, all the liability that goes with that, pay attention. You’d better make a note about the water heater strap and alarm systems or whatever. But when it comes to the sketch, local municipal guidelines no longer matter and garden levels magically become basements. Got it.

                  And remember, the appraisal industry is stand alone. We’re not integrated right alongside MLS systems, realty industry systems, and their thousand other supportive systems, we stand apart and independent from everyone. Nope that’s wrong. There would be no appraisal valuation service industry or gse’s in general if we were not providing supportive services to these other industries ourselves. Hence the NAR objection to ANSI. I’m not sure what planet you guys are on. Here on the planet earth, we coordinate together and attain maximal results by identifying local customs, then following them.

                  You guys are talking about requiring people to speak chinese when they’re driving through zimbabwe. This is a logical fault. Some ideas read well but in the real world don’t work out in the long run, especially when only the one singular group clings to something nobody else picks up. Like the air conditioned lawn mower, photo below. Boy that must have had them energized and excited back in the day. But you’ve never seen one in person, because it’s cumbersome and the larger lawn mowing industry never adopted such designs. Same as the larger assessor realty and MLS systems through the entire state of Colorado, not having adopted ANSI standards. Newsflash, you’re the guy riding that thing, out there still trying to sell it. People are standing by entertained sort of shaking their heads in amazement you still believe in the product. Good luck you’re going to need it.

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                  • Avatar Chris says:

                    In the last 3 weeks I have come across 3 appraisals where the appraiser, 2 reports by one and one report by a different appraiser, used the sketch and GLA form the assessor. So yes they are form filling monkeys. The fact that I saw 3 in this very short time all done within the last month means this is a very big and very common problem. Other reports in the last month included an appraiser who measured out the GLA including areas where the ceiling was a s low as 4 feet in height. I measured the same house and came up 200 square feet different than this “appraiser”. Not only did he incorrectly measure the house he missed the fireplace which was even in one of his pictures, said it was a full basement then showed a different size of the basement than the first floor as well as a different footprint of the first floor for the basement then proceeded to explain it has a crawl space below the family room. The problem is, there ARE a huge number of form filling monkeys pretending to be appraisers and are getting away with it. I would bet all 3 of these appraisers I am talking about are totally against ANSI along with being a professional at what they do.

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                    • Baggins Baggins says:

                      Well that begs the question, is this an amc appraiser? The overwhelming pressure placed on appraisers by appraisal management companies does result in corner cutting. That exacerbates existing assignment disparities by amc’s where they do not select appraisers by quality criteria but rather merely by the lowest fee. And they never let go of a discounter regardless of long term performance history. The amc simply makes too much money by using them. Because cost savings of reduced price services are not returned to borrowing consumers.

                      If you’re in a position to see this activity form a verifiable pattern yet continue to allow that appraiser to be on a panel and receive more orders, then either you don’t really disagree with the method or are violating your ethical duties regarding client management and competent services yourself. We are supposed to hold each other to a peer standard.

                      Which reminds me, the local assessor, he’s a licensed appraiser right? I guess the peer standard no longer applies to him, or to me when I’m dealing with him. So much for that ethical guideline too. ANSI is nothing more than a gimmick in places where this is not adopted by the larger realty and assessment community. Keep on riding it until the wheels fall off if you want. We’re standing by entertained with this rolling disaster.

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                      • Avatar Chris says:

                        It should not matter! Pressure is not allowed from Anyone no matter who the “appraiser” is doing “work” for. Now you seem to be making excuses for fake and lazy appraisers. Problem is, as it has been pointed out MANY times here, there are way too many of these fake and or lazy appraisers. You are saying its alright for an AMC to pressure the appraiser and we have to look at “those kind” of appraisers differently? Again I am seeing this push back about ANSI when it is clear those who do not want to do the job right complain when they are required to. If it bothers you so much just become and “appraiser” for the local assessors. It seems you would be very happy rounding measurements and not being held down by “the man”

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                        • Baggins Baggins says:

                          I agree we have a problem with systemic appraiser deficiency. This is a consequence of systemic training deficiency. I did not field a single question on any three of the PSI exams I took (and aced all of them first try), regarding regulatory guidelines, all the dealt with was valuation theory sort if IRV kind of stuff. All those puppy mills back in the day. I remember the old sales pitch used to be that I could get my hours by setting up to receive orders from a certain appraiser, at a fee split amount, and I would do all work send report to them, they’d sign it, or co sign, etc. It was the original amc model where appraisers churned out new licenses and appraisers would work splits like do all the work and only get a 25% amount or something. It is why they put the three trainee limit in place because appraisers were abusing that process. Thankfully those practices are not common anymore.

                          You are painting me as one of the appraisers you make accusations regarding. You are presuming I do not put in the work, because I don’t agree with your ANSI methods. That’s too flimsy of an argument, reach for something more substantial that requires less assumption presumption. Only in your mind is such an argument true, I’m frigging awesome at appraisal services, thorough with my reporting and documentation of both the home and the market data.

                          I do at times toss in an assessors sketch but only to compliment my own manually derived sketch effort. And if there is variance, I talk about it. Especially if there is variance in any form be that the agents reporting, my sketch effort, the assessors sketch, if at any point in that comparative data qualification process there is a variance between the reported size numbers, you’ve got a major problem right then and there which needs examined and reviewed. Which is why it’s absolutely short sighted to voluntarily depart from meaningful existing local standards which provide said redundant data verification and data qualification capability.

                          The purpose of the sketch is not to come up with some new reporting standard for a home with some standard not custom to the local community. The purpose of the sketch is to verify if the assessors stated size records pertaining to the subject are generally accurate or not. Because that size reporting basis is what agents use to develop cma’s bpo’s, listing prices and offering strategies, and is the basis by which appraisers would then make competent comparable market example selections.

                          Get on a different page and risk a liability disaster and accidental incompetent reporting. I agree that standardization matters, and it matters a great deal. That’s why if there is already an existing standardized approach in place, it is straight foolishness and incompetency to deviate from that. You are sidestepping the question if these negative less than reliable methods you are observing, in fact, come from amc appraisers or not. Just answer the question.

                          I’m carrying all of you on my back, because you guys are your own worst enemies with this mandated ansi nonsense. If ANSI is what the local assessors use, then you have to use it. If the local assessors use a different standard, then you have to use that instead. Or else you lose redundant data verification capability which is an essential step in data qualification.

                          1
                          • Avatar Chris says:

                            thank you for letting us all know how awesome you are. We can only hope to attain half of your level of expertise and quality. This world and all of the real estate market really owes a lot to you most powerful and all knowing one. EVERYBODY bow down do you not know who this is???!!! A balding man who wears a singlet to cut the lawn with a child strapped to “his” back open to the sun and ultraviolet rays with no skin protection

                            0
                            • Baggins Baggins says:

                              Chris, I’m on about lawn mowing lately. It’s my new full time passion. So I’ve switched from general meme’s to exclusively only dealing with lawn mowing content, and all of that is random found online. It’s a great euphemism to this industry, as appraisal should be as straight forward as lawn mowing, but due to the special interests pressures within the value industry, has become convoluted and dysfunctional.

                              Can you imagine if they ran the lawn mower industry like they try to run the appraisal industry? Like we don’t care if that lawn is on slope or not, you can only use this mower and you’re not allowed to be versatile and use anything else. And you can’t request the lawn mowing servicer you want to use, you have to use the lowest bidder lawn mowing company ordered from our lawn mowing management company, whom outsources that task again, and you still pay full fee for that discounted lawn mowing service. Then when the mowing crew comes over they’re not allowed to talk to you about your own lawn.

                              Lots of people know who I am on these boards. Just not those people whom would buck up to personal attacks because of disagreement. And we’ve all seen how vindictive the amc industry can be, coaster did hack skapinetz accounts, pam crowley did get death threats, other appraisers within the past few months are dealing with similar nightmares all over again. We all observed those long long blacklists do not use lists with associated articles back in the day which lenders knew was illegal and tried to keep secret. It’s an open secret now with tech companies, they can just add you to that list via the tech relay company and nobody on the appraisal side ever knows, the blacklist approach is alive and well, evolved into new less transparent forms via tech integration.

                              That’s why I use a pen name. It’s not to conceal my identity from you but rather the industry at large. I’m a vocal spokesperson for consumer safety and fair dealings. I’m not all knowing and I learn so much here, as well as freely sharing what I know about valuation services in the hopes of a better future for this flailing valuation services industry.

                              I do care about my career and other appraisers careers in this industry I’ve resided for 20 years. I care about regular citizens and consumer protection is also one of my passions. I learned a long time ago how rife real estate is with pitfalls and hazards, and how difficult it may be for people to manage. With increasing automation, sometimes the appraiser is the only human being a home borrower sees in person before that day of closing. Which is why it is also essential that only licensed appraisers be presented in front of home borrowers, otherwise they could get run down the rails without any actually effective safeguards. FNMA can’t control the inevitable volume of hucksters participating in the lending and technical services community, that is an impossible expectation so I argue against third party inspectors, increased automation, and outsourced services too.

                              The market crashed immediately after I upgraded to certified, and I spent the next 5 years doing nothing but default management. It’s great work which builds a lot of skills, once one learns to deal with the fact every defaulted home comes with broken dreams and financial ruin. I like to think my occasional informational relay during conversations with people about what can happen and how even those minor things can lead to structural or economic disasters and such, has helped people along the way.

                              It’s saddening and interesting, to see what people leave behind. The hardest one I ever dealt with was what I called the broken house heart. All the photos, apologies written on letters posted on the wall, a family disrupted through tragedy, that one was tough. But others were easier to manage, people simply did not pay their bills and got repossessed, hoarders, let pets ruin properties, diy hot tubs right there in the middle of the living room, mold, dangerous electric, surprisingly rather common.

                              Thankfully the 50 state AG effort to reign in default managers like Ocwen did bring about many industry corrections, and billions in fines. We’re setting up to a similar event right now with these reckless new policies and proposals being thrust upon the valuation industry. Appraisers should seriously consider why the valuation services industry is being guided and formed by everyone except appraisers, and why our requests and objections are consistently ignored. This speaks volumes regarding the actual state of consumer protection.

                              Now it’s time to reign in the destructive force which is amc’s, avm’s, and their tech company partners from destroying what’s left of this industry right as we have a real chance to finally save it. Without the independent check and balance, there will be no real consumer protection. You can equate these ideals to fighting the man or being paranoid or whatever makes you feel good about it. It’s not over yet, not while I am gripping this cold steel handle of this high powered mower.

                              I am fueled up and ready to go partner. I do not work for amc’s and I’ll never stop objecting to ANSI. I have made compelling rational and reasonable arguments against ANSI, so counter if you want. Knowing who I am personally is irrelevant, the argument is formed, presented, and validated. Deal with that. ANSI being mandated without the ability to opt out in jurisdictions which do not recognize this standard is a calamity of errors no doubt about it. And it will have many negative consequences which may very well clearly supersede any supposed benefit of larger data system cohesion.

                              9
                            • Avatar Kenneth Smith says:

                              I do not think it helps to call your fellow appraisers lazy and incompetent. Most if not all of the appraisers I have met are hardworking and doing their best in a very tough environment. just my 2 cents worth..

                              2
                              • Baggins Baggins says:

                                Ken, these dudes showed up to this blog with consistently patronizing tones and dedicated efforts to spread liberal propaganda and industry supported corporate branding messages. Don’t mistake their participation for anything else.

                                That kind of junk does not happen in the lawn mowing industry. Without a man on the mower, there can be no lawn. Both the man and the mower must be flexible and have many many working options. Like they don’t mandate everyone use a ride on even if you’re just mowing an inch of lawn. These companies are promoting some pipe dream from their ivory towers, a complete industry wide standardization which only applies to value service, automation, replacement of the human appraiser.

                                I’ve been saying for a while now, there is no more such thing as residential housing. It’s all commercial, and regular home owners are now expected to compete with tycoons from around the world with billion dollar budgets whom buy residential housing on a wholesale level, often sight unseen. They want to run residential housing like some stock market.

                                The promotion of mandatory ANSI, hybrid, third party inspectors, reduced appraisal report content, waivers, just all of that, each is suspected to be a component of this larger effort. The appraisers are racist slander is simply another more complex component. These same groups do not apply the same logic to their friendly heads of the industry. This post;

                                https://appraisersblogs.com/violating-appraisal-independence-through-intimidation-coercion-n-harassment/#comment-34971

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        • Avatar David Spurlock says:

          I find idiotic that we have to summarize the house so that the underwriters and reviewers are not forced to learn to read the report form

          1
        • Avatar Kevin says:

          >This whole illogical approach of parsing size out in ways not recognized by the local mls, not recognized by local people, not recognized by the municipal building codes which the assessor prescribes, it’s all hogwash.

          Exactly, and well stated.

          You cannot adjust for something that nobody else is even measuring. There’s no data.

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        • Avatar Doug Kues says:

          These four Appraisers Blogs responses are more accurate than most posts I have seen. GXX001 – commit to memory and create your CYA. Effective dispute would never hold up to reasonable scrutiny. This whole concept was about as reasonable as having an appraiser commit to “proper” water heater strapping. “operating condition” of a carbon monoxide alarm, or removing the word “apparent” from whether or not adverse environmental conditions exist. You show me a report reflecting a home with an 18.4″ wall and a total square footage of 2,411 square feet and I’ll show you two intentionally misleading errors.

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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 !!

    4
    • 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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    • Avatar Chris says:

      why would that be, do some areas not have an assessor. So what have you been doing up to now? have you been including 2nd floor areas with a ceiling height of less than 5 feet? have you been including basement sizes? Seems like a lot of people here dont understand that the form has an area for basement separate from the GLA. I dont recall that ever not being that way. IF there are appraisers out there that do these things then I fully understand any mistrust the public may have

      1
      • Avatar don says:

        Some states, counties, or parishes contract an overall appraisal every three to five years, by an independent appraiser. Some sell their non collectables as investments in a bidding process.
        Did the one of the political parties talk about Federalizing the assessing housing or was that just a misconstruction?

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    • Avatar BA says:

      Absolutely, totally and Completely AGREE. And now on to adjustments on these comparable! I am sure they will now be consistent! Right???

      1
      • Baggins Baggins says:

        https://appraisersblogs.com/solving-the-ansi-measuring-dilemma-a-simple-work-around#comment-34587

        An effective workable solution.

        Work the grid twice, print the first to pdf include in report.

        On second round use directions provided to move adjusts, and only change the size of your subject in the interactive 1004.

        You can make your subject ansi compliant without fiddling with confusing adjustments.

        Because ANSI is counter productive, and represents a departure from otherwise already standardized approaches in many states. We don’t need another standard, it’s unacceptable for FNMA to push this without a voluntary opt out option. We should be following our local community standards and municipal guidelines.

        If at any point ansi causes false net gross indicators, because you can make your subject ansi compliant, but are unable to do so with your comps, scrap your method and use mine instead.

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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.

    2
    • 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!

      10
  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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    • Avatar Chris says:

      THere are appraisers out there that rely on realtors for GLA? When a home owner wants to fight tax assessments, do they go complain to the realtors in the area or the assessor? Why would anyone believe a realtor that will use a basement in GLA just to make it sound bigger, include closets, decks and garages in room count. What have you been doing up to this point. There really has been no change. They just want consistent measurements from appraisers that think no wall has ever been anything other than a whole number.

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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.

    9
    • Avatar Truett Neathery says:

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

      2
    • 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?

      8
      • 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!

        1
        • 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.

          9
    • 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

      0
      • Baggins Baggins says:

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

        0
        • 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.

          1
          • 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.

    4
    • 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 !

      2
  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.

    4
  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?

    0
    • 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.

      0
      • 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…

        1
        • Avatar don says:

          How broad is the statement ” most probable value in dollars, and or estimate of value? I believe that the form asks for a summarization for the arrival of VALUE. Does the price offered have any influence on your conclusion or should you round out, up, or down? AND what else can you round?
          Remember the VA used to ask for any “evidence of discounting”.

          0
    • 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.

      0
      • Avatar koma says:

        Hey Baggins, Just received an email to sign up for an app called CubiCasa. It will measure the subject house to ANSI standards by just using your phone… hahaha Again, none of my area assessors/mls use that standard of measurement.

        0
        • Baggins Baggins says:

          NFM lending sent out a recent email, direct assignment on valuetrac. Not sure if they have always been direct but have at least called more more appraisers and a new sign up link recently. FYI. There is an escape from the amc madness.
          CubiCasa; THIRTYFIVE DOLLARS PER SKETCH!!!??? Headquarters in Finland. Written by their marketing experts from a world away. Sorry dudes from Finland, I’ll keep my 10 dollar 100 ft tape measure I bought 20 years ago and you guys can keep your tech and reindeers or whatever. Globalism is a disaster, as the whole world moves to exploit our industries. Create a program once, charge $35 dollars to perpetuity and infinity with a rising cost basis as the inevitable software update is needed. I wish every tech developer on the planet would take a very very long vacation and like learn to make quilts or do pottery or something instead, things we could actually benefit from and use without contributing to more environmental pollution and ewaste. Special prediction, you’ll have to always pay more whenever you upgrade your phone. For those not in the know, you can sub all of that with various freeware or just print out a grid page which is a free form on alamode and use a pencil. It’s all marketing hype. Did you know that investors are standing by willing to pay cash for your house tomorrow, no appraisal necessary?
          https://www.cubi.casa/your-mobile-phone-is-the-new-disto-for-home-appraisals/

          0
        • Avatar don says:

          `Years past I did a lot of hard money second loans. The hard money lenders used strategies to insure against loss. Encouraging the borrower to falsify financial info and NOT be allowed a bankruptcy worked.
          Who was the crook, It didn’t matter how an assessor appraiser, or Realtor measured the house, the lender was protected?

          0
  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!!!

    10
    • 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.

      7
      • 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.

        2
  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?

    3
  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

    1
  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?

    9
    • 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.

      2
  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.

    6
  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.

    2
  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

    3
    • Avatar Kevin says:

      The angle you’re holding the laser at matters, too.
      And sometimes you have no decent line-of-sight directly to the opposite wall, this is especially true when doing outside measurements.

      0
  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.

    2
    • Avatar PJTMC says:

      You are spot on about our industry. I have been a residential appraiser for over 35 years, and it always amazed me how no one in this industry stands shoulder to shoulder and says, “we are mad as hell and not going to take it anymore”. Instead, many act as though other appraisers are the enemy and willing to cut their throat in a heartbeat. Unless this attitude changes, we are doomed for extinction.

      5
      • Avatar Koma says:

        Well now is the time. I am pushing hard on finding more local lenders. Two that I have keep their loans in house and one doesn’t even require UAD. If my other clients inform me their jobs are for Fannie I’ll decline. They’ll keep sending, then asking, then pleading and I will say no. It’s good to cover a rural area where appraisers from neighboring counties will not venture into.

        Now I saw the exception, but why waste my time adding more information with Fannie keeping an “eye” on me. Hopefully enough of us will use the exception or even stop as to cause enough chaos. I dropped the ones requiring a yearly background check and survived, I’ll survive this bs too.

        0
        • Baggins Baggins says:

          In house lenders are like white whales. If you find them they often also make borrowers sign a caveat they may sell to recapitalize mortgage lending funding if necessary, although they’re likely to retain servicing oversight. Don’t get too excited about the perceived protections of that particular working avenue. GSE work is a mess but also provides the benefit of scale and the largest body of borrowing consumers. In house lenders could get wiped out with a price slide and might be in house because they’re sanctioned from certain packaging and reselling opportunities or create generally higher risk like hard money or bridge loan types. Be careful.

          0
  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 ?????????

    2
    • 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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    • Avatar PJTMC says:

      To your point, this is not about measurements, it is about the continued attempt of dismantling of the appraisal industry. The lending industry has been trying for years to get rid of their only stumbling block to complete control and what better way then to disguise it as a NEW requirement hoping appraisers will boycott so steps can be put in place to circumvent the appraisal. Appraisers need to unit and start a class action lawsuit with an injunction put in place to postpone so this can potentially can be reversed by the court. Any takers to head this up?

      4
  33. Avatar cotton says:

    ANASI? Sounds racist!

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  34. Avatar John L Daley says:

    I’ve been in finance my whole career. Been in appraising for 20 years. This is just another incompetent decision by people who BELIEVE they understand the minds of buyers and their motivations. There is not one person who voted this in that understands my motivations as a buyer. YES…there is not one person who made this a regulation that understands my motivation as a buyer. Measuring a home is so common sense it is ridiculous. And to think someone might be off 5-10%…..God forbid. Interesting. We are required to include three comparables in each appraisal. I usually include 4-5. We do that for a reason. Not only to bring the sales within range of a reasonable value, but also to understand that GOOD appraisers already know he value before they complete. Its called knowing the market. And sadly….none of the people who made this decision knows my market. Any comments??

    This is the definition of ANSI…Another Neurotic Standard created by Idiots. Once again another standard to strangle the industry and cost more to the consumers. Wake the hell up people. Does anyone think for ONE SECOND that minimal GLA differences have to do with the motivation of someone wanting a home? And here is the bolded statement above …….We welcome critical posts & opposing points of view. We value robust & civil discourse. You may openly disagree, but state your case in an atmosphere of mutual respect, in which everyone has a right to a particular view about the topic of conversation. Please keep remarks about the topic at hand, & PLEASE avoid personal attacks. If the poster gets you upset, it is the Internet, you can walk away from it.

    According to the statement above…..PLEASE avoid personal attacks. Hate to say it, but the new regulations are a personal attack on consumers because you see by comments you are costing more to consumers. Apparently, common sense is gone in our industry. I had a great run…but people in my own industry dumbed down, and have no clue why they did it. GLA??? Are kidding me??

    2
    • Baggins Baggins says:

      https://appraisersblogs.com/ansi-measuring-standard-required-by-fannie-mae-in-2022/#comment-32975
      Don’t miss the details on the volume of appraisers whom were part of the ansi work group but had their opinions and suggestions dismissed. The appraiser communities (or at least a small sampling of that), had their opinions ‘recognized’ and summarily ignored.

      Take the gloves off, let them have a piece of your mind. This is what happens when we allow special interests to control everyone else through the power of proprietary government connections. This ansi thing is yet another in a long line of reasons why government should get out of the business of subsidizing lending and insurance. Lenders would never go for this if it was 100% of their money on the line.

      2
  35. Avatar ej says:

    I’m disappointed that the AGA has not strongly condemned ANSI. And the special interest profiteers like Bryan Reynolds.

    2
  36. Avatar PJTMC says:

    Issue: Adoption of ANSI Z765-2021 by appraisers
    Benefits: None
    Detriments:
    1. Appraiser is no longer on a level playing field with public & revaluation company reported gla for comparables
    2. Dwellings not meeting ceiling height will, in all probability, require large gla adjustments in the appropriate area resulting inherent issues and questions for not appearing comparable. Especially true of identical or near identical dwellings.
    3. Confusion with underwriters, and borrowers resulting in extensive time consuming responses to lenders and management companies.
    4. Extensive use of extraordinary assumptions will be required for the comparables. (In other words, “guesstimates” as the requirements do not rise to the threshold of extraordinary assumptions).
    5. Misreporting and different reporting of comparable gla from different appraisers as the result of the “guesstimating” requirement. As noted, the new requirement do not rise to the level of an “extraordinary assumption” however the appraiser is being led to believe that it does (fairly loose use of the intended use).
    6. Appraiser is to alter, at his or her own peril, gla reported by public records for comparables. It is made clear this decision is at the liability of the appraiser.
    7. No direction on the existence of suspended ceiling height vs. actual ceiling height. Just one in a plethora of examples.
    8. Serves no good purpose to anyone including the borrower, lender, appraisal management company or appraiser
    9. Will result in contested and angry borrowers and lenders. Especially with the use of “guesstimates”,
    10. Comparable gla becomes argumentative and personal in opinion with no real bases of reference. I wonder how this will work when a national data site is used for checking data and comparable gla, for a particular property, is reported 10 different ways by 10 different appraisers?
    At least the current process has some bases that allows all properties, subject and comparables, to be on a level playing field. While it is not a perfect system it does allow the idiom of apples to apples and not apples to oranges.
    In any scenario, one must ask themselves, “will anything good come out of this”. In my opinion the answer to that is “no”. If the answer is “no” then why pursue it? I see this just being a total debacle that will need to change at some time in the future. It seems this change is likely being brought about by bureaucrats justifying their existence and force feeding everyone this is in their (you and me) best interest. It is totally irrational and has no positive outcome, only negative. So, for the sins of a few the masses will now suffer and, the suffrage is not limited to the appraiser; the entire industry will suffer the debris left in its wake. The initial proposed change should have been “highly” publicized and presented to the masses of people in the lending industry who work in the field and understand the difficulties they face every day. I myself, was not aware this change was being proposed. This whole idea presents significantly more liability exposure to the appraiser given they have made it clear the appraiser is responsible to make his or her best judgement in arriving a comparable gla, really? This, in itself, is alarming if not in direct violation of USPAP reporting requirements. And speaking of USPAP why have they not commented on just how the appraiser is going to comply with these new FNMA requirements and not be in violation of USPAP? It smacks of all kinds of USPAP violations sooooo, how can an appraiser perform his or her job in a manner consistent with USPAP and still meet the new FNMA requirements? They can’t, simple as that. This seems to me to be ripe for discussion.
    Of course, the bureaucrats, who arrived at this new concept, will argue it is about people not liking change however, nothing could be further from the truth. It is about the appraiser being able to conduct his or her business in compliance with USPAP on a level playing field and not relying on “guestimates” (at best) in arriving at a value estimate. If the respective towns and revaluation companies are not required to change how they calculate gla (something FNMA does not have the power to do) it is doomed to failure. I can see this whole ridiculous requirement resulting in increased lawsuits, reprimands from licensing boards, increased insurance costs and an overall collapse of the appraisal industry…. perhaps this is the end game here?
    Unless the way the towns and revaluation companies change the way they measure their properties to meet the new FNMA appraiser requirement, I see this being of no positive benefit what-so-ever to anyone. It is akin to saying all prior appraisals are null, void, unreliable and should be disregarded and, that my friends, is pure nonsense. Holding the appraiser accountable to meet an entirely different industry standard is ridiculous. ANSI serves a purpose for an entirely different industry and is being reinterpreted to apply to the appraisal process. For that matter why not incorporate all of ANSI into the appraiser requirements? Did I just suggest that?
    In closing, “if it ain’t broke, don’t fix it” is probably the best closing statement to make. Me, like most of you, never knew there was a problem with relying on relevant, reliable data sources for comparables that, according to FNMA are no longer reliable. Shame on them.

    5
    • Baggins Baggins says:

      PJTMC, although you eluded to this at the end of your well written post, you forgot one thing; To force appraisers to buy constantly changed and constantly updating ansi books they neither need nor want.

      Seriously, take a minute to look at the ‘committee’ action links I posted. Have fun reading those and marvel at the obvious special interest influence whom basically ignored like 14 out of 15 appraiser committee helper objections. They had their mind made up ahead of time, the token action of getting professional objective opinion did not yield the results they sought, so they ignored the professionals and all their helpful objections and suggestions.

      It’s much like what has been happening with covid, censor and/or ignore everyone whom has legitimate reason to disagree. Conflict of interest has become the norm rather than the exception with just about everything having to do with governments lately. Hamps book on measurement theory is better, easier to understand, and we’d only have to buy the book once or I think it’s even free to review online. Shake a stick at that. You know what they say, if you don’t really understand the issue, you may have to reconsider your answer and opinions later. Those green building idiots are just trying to sell more product and want to corner the market with a unique production and unique measurement of production they know damned well other builders and various city authorities don’t follow. They’ve got a mainline into FNMA lending and even get special reduced mortgage rates and reduced processing fees for mortgage loans pertaining to their green certified housing products. Clear as day conflict of interest, that group should be separated from a variety of checks and balances to their growing power, the sketch methodology just being one example.

      You can’t negotiate with people whom say what’s mine is mine and what is yours is negotiable.

      2
  37. Avatar PJTMC says:

    Lot of good points being made however that and 10 cents will get you a cup of coffee and that is what is ecpected; the appraisers will lay down and take it. Appraisers need to organize, hire a class action Attorney, get an injunction and sue to reverse this decision. There is ample information to prove why it will not work and is a detrement to the general public. Like my coach used to say, “talk is cheap, it takes money to buy beer”. Talk is meaningless unless we take action. Anyone on board?
    .

    3
    • I think suing them would be a tough row to hoe, but given that this is tantamount to widespread mortgage fraud, it may be the only solid legal option. Otherwise, I’m already submitting every report with the exception code and explanation in my reports.

      0
      • Baggins Baggins says:

        Great idea Jesse, get ahead of it. I’m going to wait to the day myself.

        If there is to be any class action by appraisers, my vote is to look at the continued violations of Dodd Frank RegZ on Appraiser Independence, specifically the C&R fee rule and the disregard of the original spirit of that law which would have seen amc’s wiped out overnight or suffer $10k/$20k recurring daily fined for every dang time they got away with what’s your fee and turn time nonsense which drove the appraisers fee down below what the consumer was actually charged for the appraisal service. If anyone would take this proposal seriously it could be the largest class action lawsuit in American history, could really rid us of the amc debacles which continue to perpetuate industry unraveling. Companies like Appraisal Scope, Appraisal Port, Mercury, and the big amc players whom run their own email systems could have records subpoena for discovery and it would be so easy to prove. How many damned emails does it take to place single orders? We want to know how many emails they are allowing to be sent and how much cumulative time they waste for appraisers. Wasn’t there an amc involved with this ansi deal too? The amc’s continued undue influence saying they represent the appraisal industry at large is a fabrication, an outright lie. The majority of appraisers out there refuse amc services outright. And we might just get a dollar or two in the process downstream of all the lawyers but at a minimum we could all return to gse lending without much ado, get full fees without middle men, have more access to more working opportunity, train and hire new people, just like the good old days before all the carpetbagger amc’s sprouted up like duck dynasty chia pets.

        An injunction to stop FNMA dictates? That’s novel and sure, why not. I guess everyone rally around AGA? ASB ain’t going to do a damned thing, they support forced book purchases, they don’t object to that. The problem with lawyers is someone has to pay for their services and the lawyers must prove harm. Which means successful lawsuits will come after the fact. When enough appraisers use the exception code or refuse service if the code is not accepted, they’ll rescind the order. It’s obviously a short sighted move, what was the point of developing the CU database if they would turn around and ruin the integrity of half of their sizing data. The people pushing this and promoting this are just in one branch, while other gse decision makers are in another. Eventually they will sort it out but in typical bureaucratic fashion, create two new problems for every one they seek to solve (Mises). Want to make a real difference? Wind down the gse’s completely. Government has no business using tax dollars to fund mortgage lending or insurance, it just leads to massive mal investment and gross reductions in actually successful lender risk management policy The fed remains addicted to unlimited spending and unlimited printing, mortgage backed securities are moving towards being an empty bag again. We’ll see what happens this year if they dare to raise the rates, refuse to stop printing money, or both. They can’t bury QE in housing forever and it’s about to bust out. Inflation proves it.

        3
  38. Avatar Martin Cahn says:

    I THINK ITS TIME FOR APPRAISERS ACROSS THE COUNTRY TO TAKE A STAND. IN THE FAMOUS WORDS OF NACY REAGAN “JUST SAY NO” USE THE EXCEPTION CODE EVERY TIME. I SEE LENDERS ALREADY SAYING THAT THEY ARE NOT GOING TO AHEAR TO THIS IN THEIR ENGAGEMENT LETTERS. HELL, NO ANSI Z765-2021 MUST GO!!!!

    3
    • Avatar don says:

      Your ENGAGEMENT Letter is your agreement with your customer for the amount of work proposed. Carefully word your contract and charge enough. IFF you’re working for someone else, that a different story or CONTRACT.

      1
  39. Avatar ej says:

    It simply amazes me that not one so-called Appraisal Organization has not come out and condemned this latest attack on appraisers.

    4
    • Avatar PJTMC says:

      Add the Appraisal Foundation and the appraiser not being able to be compliant and NAR who will be directly affected no doubt not to mention many appraisers are members. Write your State Attorney and let them know this may impact tax revenue and is not in the best interest of the consumer.

      2
  40. Avatar Tom Baldwin says:

    The only change for me will be how I handle upper levels with sloped ceilings. I generally use my judgement as to how functional the room is. Some have built-ins and such below the 5′ mark.

    All else is pretty much how I’ve been measuring for 38 years.

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  41. Avatar PJTMC says:

    First and foremost, “location, location, location” is the mantra of Realtor’s and has been for years. That is a pure and simple, unadulterated “fact”. If the appraiser is being blamed for undervaluing properties based on location, then shouldn’t the Realtors be held equally accountable for the listing prices of the varying market areas they work in (could have something to do with their PAC, ya think?). That is the absurdity of this assault on appraisers; but I suppose, in their minds, the end justifies the means. It appears there is an all-out assault on the appraisal profession at the moment from varying agencies. Now the ASC is making unsubstantiated and inflammatory claims the appraiser is responsible for everything wrong with the Mortgage Industry. It seems, once again, USPAP is irrelevant to individuals who do not work in this industry. It is easy to be an “arm-chair quarterback” when you have a “woke” agenda. “Fly in the face of” best describes this assault on the appraiser and, visa vee, USPAP (laws we are licensed to abide by). Sad to say, USPAP and the hard-working people who oversee our industry are also being assaulted by this very ASC report and treated as irrelevant just to meet their predetermined agenda. “Hmmm, so let’s have the appraiser do unethical things so they can produce perceived ethical appraisals that meet our agenda and then file a law suit when the property gets foreclosed for over-valuation”; yeah, that’s the ticket. This can happen in any market and any value range. So why have appraisers or, for that matter, regulations? I think this is the best interpretation to the ASC report. Let’s be honest, the appraisal industry is not a perfect process and has never claimed to be. Admittedly there is room for improvement however intimidation is not the answer. I don’t think this new ANSI mandate by FNMA is coincidence and seems to be in lock-step with the ASC report. The “ethical” appraiser is the last stronghold in protecting the American consumer from mortgage fraud, abuse and collapse of the economy (or have we forgotten the mortgage crash after the implementation of “B” & “C” paper by Wall Street and unscrupulous secondary market lenders?). Sad to say, this report is not surprising given the environment we now live in. I just hope the powers to be can see through this thinned veiled attempt to “defund” and eliminate anything and everything that stands in their way. I certainly hope that the Appraisal Foundation, National Association of Realtors, Appraisal Institute, Smaller Banks, State Attorney’s and any other relevant legal & mortgage industry participant can see none of what is going on is in the best interest of the consumer and business. They all need to step up and get to the bottom of what is taking place if they want to be relevant in the future. This isn’t just about appraisers, it about the very fabric of the mortgage industry as a whole and stability of our economy. Today, the appraiser, tomorrow….?

    1
    • Avatar don says:

      Real Estate Values are Local, Local, Local. Intel’s decision to build a “chip” factory is based on; National Politics that State’s economy, Intel’s board directors and CEO
      The value of a house near the church, the park, the school district or placed on a prominent lot illustrates local competition, or Market Value. Remember Local, local, local.
      The confusion is that a lender is able to sell a local loan to an investor in Warsaw Indiana or Warsaw EU. or Warsaw China? That’s the value of the NOTE or Paper, not the RE

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  42. Avatar John L Daley says:

    Does anyone have a website I can go to that gives an understanding of the ANSI 2021 regulations in a reasonable common sense summary?? Thanks.

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  43. Avatar Thomas Baldwin says:

    The $25 document is only 16 pages.

    Measure from the corners of the building in inches or 1/10 inch.

    Stairs to basement count regardless of finish. Finished stairs count for level they descend from. So a finished stair well that is say 10 x 3 from 2nd floor to 3rd unfinished attic level counts a 30sf on 3rd level.

    sloped ceiling levels are from 5′ with some portions being measured inside and some accounting for stud dept. They give a drawing to show you what to do.

    Below grade is counted as below grade… that’s novel concept.

    It’s not that big of a deal. Not sure what everyone is going about with drive-by and all that. If I put a sketch in a 2055 I simply tell them where the measurements come from. I sure didn’t measure it while sitting in my car.

    https://www.homeinnovation.com/about/bookstore#Purchase%20Square%20Footage-Method%20for%20Calculating:%20ANSI%20Z765

    1
    • Avatar Koma says:

      So, if it is no big deal why make it a requirement? If it’s no big deal then why not make it a requirement for every institution involved to use this method (metric system anyone? Aaah early 1970’s fond memories). The reason everyone is going on about this is because they know in their areas this method is not being used by mostly anyone else (Realtors/Tax Assessors/MLS) and they are cocerned about using information to give credible results.

      1
      • Avatar Thomas Baldwin says:

        It’s not used in my area either. At the end of the day the methods are all very similar though.
        What I mean is. If they want a required standard for all appraisers. Then pick one and roll with it. It’s no big deal. ANSI, the North Carolina standard, whatever. All are similar and none are difficult to learn.
        Many of our MLS listings will say SF per Appraiser. That doesn’t always mean it’s correct. However if after April 1 they listings say Per Appraiser ANSI I will know how it was done and I’ll know it was not taken from some 7 year old appraisal done by a trainee that got it wrong.
        All that nonsense from FNMA about measuring and appraiser credibility is fiction in my opinion. Why are they doing this? I think as someone mentioned above they must want data for their AVM’s and Desktop products and I’m sure the programs run better with data that is acquired in a similar manner.
        Around here the credibility rating from high to low would be
        1. Appraiser
        2. Assessor
        3. MLS except for new construction which is often fiction | MLS pulls from Assessor most often.
        4. Realtor — They rarely measure because they’ve been taught it’s a potential liability so they pass the buck. This can result in going back to 1. and paying an appraiser to measure. Easy money.
        5. Homeowner – yep, agents will place listings based on what the homeowner says.

        So FNMA, for my market, has it completely wrong with the credibility claim.

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  44. Avatar ej says:

    Appraisers, here is your chance to tell Fannie and Lyle Radke, along with one of the makers of this disaster Bryan Reynolds that you will not submit to ANSI.

    1
  45. Avatar Chris says:

    Geez what a bunch of crybaby appraisers I’m reading about, either conform to the regulations or leave the business.

    2
    • Avatar Jesse says:

      If the options are to commit fraud by using a non-market standard, or leave the industry… I guess some appraisers can go to jail would be option three. GXX001 –

      1
      • Avatar Chris says:

        What is wrong with you? You have been instructed on how to properly measure a house for uniform standards across the country, suck it up or leave the business.

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        • Avatar Jesse says:

          6% of the country uses this standard. To use a different standard of measurement for the subject than for comps would be an invitation to fraud.

          2
          • Avatar Chris says:

            As an appraiser, you are to view the comparable properties and determine the correct gross living area, as best as you can, and if you think there is an error in the assessor’s reported figures you are supposed to reconcile that in your addendum stating why you have used a different GLA than the assessor. Suck it up or leave the business. You are not committing fraud by reporting the correct GLA of the subject property. What is wrong with you???

            1
            • Avatar Jesse says:

              So making up a new GLA. No. Using an non-standard measurement system. No. These amount to an act of fraud. And this is why FNMA has provided GXX001 – so, not using ANSI is still adhering to FNMA’s guidance. Good luck explaining on the stand where you got your made up GLAs.

              2
              • Avatar Chris says:

                We have been using Ansi for 30 years, you do what you want, but you have been instructed to use the ANSI system, so good luck explaining that to the judge if and when that time ever comes for you. You must be an old dog who cannot learn a new trick.

                1
                • Avatar Jesse says:

                  Ad hominem will get you no where. 5 years in. 94% of the country doesn’t use this “standard.” Good luck

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                  • Avatar Chris says:

                    You have been instructed to use a new measuring system, get over it or leave the business.

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                    • Avatar Jesse says:

                      Is there an exception 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.

                      For example, berm homes with their entire square footage below grade would be eligible for an exception. The appraiser must provide
                      justification for an exception, lenders are responsible for confirming the appraiser provided an adequate explanation. Fannie Mae will monitor for inappropriate use of exceptions (i.e., using methods other than the ANSI standard for homes that have typical above grade square footage).

                      1
                      • Avatar Chris says:

                        I do not understand why you were making a mountain out of a molehill, the measurement is for basic homes, not for unique homes with unique square footages. Wait till a buyer measures their home or another appraiser and finds out your GLA does not match their GLA and you were making gross living area adjustments, your insurance company will pay out of court and your insurance rates will go sky high because you are an old dog who cannot learn a new trick. Good luck to you sir.

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                        • Avatar Jesse says:

                          Because making up GLA’s is fraud. Because using an non-credible measurement standard is a USPAP violation. Because using non similar measurement standards can result in 5% differences in GLA and therefore fraud. Because its fraud – which is the justification I’ve put in every report since this non sense came down the pike. If your market uses ANSI, use it. Otherwise, let appraisers be professionals and not monkey’s jumping through hoops.

                          Per FNMA: GXX001– ANSI is not used by any market assessor and its use would be misleading and result in over/under valuation on a regular basis. As it would result in mortgage fraud to provide a non credible valuation based on non credible methods, the appraiser can not comply with this requirement and employs the FNMA exception.

                          You might also refer to page 36 in Working RE for more reasons not to use ANSI.

                          3
                          • Avatar chris says:

                            Have you not been instructed to use the ANSi method of measuring ??? What will you do when the Judge asks you why ??? That is if your insurance company lets you get that far. They wont, they will just cut a check….then you are screwed for insurance for being dumb. Cry all you want. You have been instructed to use ANSI. get over it or leave the business old dog.

                            0
            • Avatar PJTMC says:

              So, by your logic, the appraiser is to rely on his or her best “guesstimate” and not rely on what was once considered a reasonable, reliable data source when evaluating a comparable gla? The change eliminates, for the most part, anything being a reliable data source when it comes to comparable gla and there is no longer a “level playing field”. So, in some cases, using your logic, 10 different appraisers, using the same comparable, can potentially come up with 10 different “guesstimates” and potentially 10 different value estimates? As you have stated, when an appraiser “determines” (your word) their “guestimate” is “correct” (your word) the Assessor data, that is presumably based on physical measurements, is wrong and make a statement to that effect in the report? I’m sorry but that is preposterous and elitist. If an appraiser has proof his or her calculations have some basis for accuracy other than a “best guess” then your theory may be relevant. What I can agree with, for potential gla differences, is stating the appraiser FNMA required calculations differ from that reported by the Assessor, period. The appraiser, in most cases, has no clue whatsoever if the Assessor is wrong just like they don’t know if their guesstimate is right or wrong. I believe the appraisers are just trying to find common ground so they can do their jobs effectively and with some reasonable confidence the data they are using is accurate defensible and supported by a common, verifiable and reliable data source. It just seems counter intuitive FNMA wants gla accuracy down to the inch for a subject property however throws care to the wind when it comes to a comparable with a “best guess” being acceptable. You don’t sound like and appraiser however all opinions are appreciated and welcome in this debate.

              2
              • Avatar chris says:

                Yes, If assessor data is Obviously wrong, the appraiser is to use his/her best questamete, We in the Northeast have had these skill since our training. I would prefer to replace the comp, but if I have to use it, yes we make statements of what we did in the report. If you are from the west coast, sounds to me you appraisers are just data entry and not have critical thinking skills. You worry about liability about the comps, I would worry about liability from your lenders, investors and the borrowers. Maybe that why “they” let me appraise multi million dollar, unique, ocean fronts, Yadda yadda yadda, properties for the past 30 years.

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                • Avatar Jesse says:

                  I cut my teeth in the north east appraising… and ANSI is not industry practice in much of it. ANSI can be credible… but it results in more guessing, which is why it shouldn’t be used in areas where the assessor isn’t using ANSI (ie. 96% of the country).

                  2
                  • Avatar Chris says:

                    Think about it, when the appraiser start to use different GLA’s for the comparables, if they need to, it will screw up the lender’s AVMs even more keeping us employed. And especially with the conflict between the GLA of the subject property reported by the assessor which is wrong 50% of the time which you should know if you learned in the northeast. It’s really not a big deal, and that is the point I am trying to make, we have been instructed to measure the properties in a certain way. And I will say it again either conform or leave the business.

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                    • Avatar Jesse says:

                      So, your rationale is spite, not credible reports. Good luck boss.

                      3
                    • Avatar Koma says:

                      Man for someone in this business for 30 years and being so angry (see your prvious posts), you might want to consider retiring yourself.

                      We are just having a conversation about this as rightly we are allowed to. Your demand that we follow them blindly and just leave the industry is preposterous. What I/we can do is not accept any orders from Fannie and if enough of us do the same then it’s on Fannie to realize and figure their problem out.

                      2
                      • Avatar chris says:

                        Angry..not angry my friend, just got back from an 8 week vacation in Asia. I am as Happy Happy as could be. I will be retired at the age of 56 in less then 6 months living in paradise never having to work again.

                        I am just amazed. We have been instructed to measure houses with ANSi, it is not a big deal, just like we were told to report past sales histories, prior assignment notifications, UAD etc, etc…. it really is not a big deal.

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                        • Avatar Jesse says:

                          Happy Retirement.

                          2
                          • Avatar chris says:

                            Thank you, after 30 years, i am done appraising. My point is that we have been instructed to use ANSI, why get all worked up over it. What Asia has taught me is worry about the big things, be happy. There is noting that can be done, so…..get over it ! its not a big deal.

                            1
                            • Avatar Jesse says:

                              Fraud is a big thing… thanks.

                              2
                              • Avatar chris says:

                                Jessie, Maybe I am missing something…What fraud are you taking about???

                                0
                                • Avatar Jesse says:

                                  The only credible way to value real estate is to have similar units of comparison. If you have to “make up” means of adjusting the GLA of comps (because in 96% of the country ANSI is not the standard of county measurement, much less others) then you have to have a credible means of that adjustment. IF however, your county consistently measures homes in a market, even if its not the most precise in any one given instance, then you have consistent units of measurement. If you live in a non-disclosure state or where the assesor is drunk while measuring… good luck, luckily that’s not my market. But if I use ANSI I would regularly either 1) make up a means of adjusting county measurement to ANSI or 2) under/over value real estate by 5%. Knowinly using non credible methods to come to non credible results is fraud. So, the appraiser must determine the credible scope of work (USPAP) to make a credible value determination. In my market, the use of ANSI would be fraud. Therefore, everyone of my reports will disclose that and employ the exception:

                                  “Assumption/Limiting Condition #2 – In an effort to use the same units of comparison between the subject and comparables, in order to provide credible valuation results, the standard of the county is deferred to whenever possible and credible for the purpose of analysis. Per FNMA: GXX001– ANSI is not used by any market Assessor and its use would be misleading and result in over/under valuation on a regular basis. As it would result in mortgage fraud to provide a non credible valuation based on non credible methods, the appraiser can not comply with this requirement and employs the FNMA exception.”

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                                  • Avatar chris says:

                                    So what you are saying is measuring the subject under ANSI is fraud, because the comps were measured another way. If you then see the assessor info is incorrect, make a statement as to why, no big deal. If you know the assessor is always off, I hope you are reconciling the comps in GLA in the 1st place…comes back to those critical thinking skills we appraisers are suppose to have, other wise we are just form fillers.

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                                  • Avatar Thomas Baldwin says:

                                    So Jesse, many here and in my market as well notice that the assessor often gets it wrong. It’s just painfully obvious. Would you accept that obvious wrong as credible. I would not.

                                    I just had a property last week. The assessor measured the dept of the dwelling 1′ too long. It was a cape design. On the upper level they also included some unfinished space as finished and did not include the stairwell.

                                    Ironically when all was said and done and I used ANSI we ended up very close.

                                    You wrote “IF however, your county consistently measures homes in a market, even if its not the most precise in any one given instance, then you have consistent units of measurement.”

                                    Maybe I’m reading you wrong but it seems you are conflating Accuracy and Precision. If your county “consistently measures” then they should get precise results.

                                    If they “consistently measure’ incorrectly, then they will get very precise yet in-accurate results and as I noted above it is often painfully obvious.

                                    If you precisely measure a dwelling to 1” and read your ruler wrong that’s precise and inaccurate. This is what I see in several assessor’s records especially in the 2nd and 3rd levels of transitional dwelling. The assessor is very precise in their measurement method of choice. They are precise in their method of reporting by whichever means they choose. Say for instance a 24 x 42 Cape Cod 1,008 down 504 up. The method simply being to count upper level as 1/2 of lower level. No dormers even though the dwelling has 2. Now I look at MLS photos and see the interior is clearly more than 12 feet wide upper level. I have MLS room dimensions stating the room is 16 feet wide. I see 6′ tall bookcase, etc..

                                    So the assessor has great precision in measuring and reporting but is about 150sf off the mark in accuracy. I appraise the identical home next door and end up with larger measurements yet I do not make an adjustment for GLA. I simply tell the client why I have not done so and maybe even include a photo from the comparable upper level. I consider that my job and why I was hired in the first place.

                                    In the above scenario my measurements will not align to any published source yet they will be adequately precise and more accurate. At the same time all my reporting is credible. In fact I lend additional credibility to published data. I’m not going to inaccurately measure a dwelling just to match some other published data method. I have way too many counties and sources of the reported GLA to try and “do it the way they did it”. that would be impossible. I do not have to “make up” anything. If it’s there I use what I see. If it’s not I don’t make it up. I may tell the client I have my doubts the comparable GLA but no proof.

                                    FNMA is making this bed, they can sleep in it. In the grand scheme of ANSI vs the new Condo research guidelines, this ANSI thing is a cakewalk.

                                    So… I use ANSI to the best of my ability the way I always have done. Actually I will now tweak a couple of minor things that won’t make any real difference.

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                                    • Avatar Jesse says:

                                      Using the assessor STANDARD does not mean using their MEASUREMENT. If the county measures to the nearest foot, that is the standard, not the measurement. Of course if the county is wrong you make corrections (ie don’t include the 10×12 enclosed porch) but you don’t make up a new measurement (9.9×12.2 because… I guessed). I sincerely can’t be asked to rebut opinions of people who are failing to read the counter point.

                                      USPAP says the appraisers determines the scope of work, every FMNA report is required to be USPAP compliant, so that’s the end of it. If you have a consistent way to read the assessor’s tape for them after the fact – congrats, I won’t get caught playing that game of make believe (call it critical thinking, it’s guessing at best). If you want to be a form fillers using FMNA’s non credible scope, so be it – but I’ll continue to use critical thinking skills and use USPAP and recognized standards as my guide.

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                                      • Avatar Thomas Baldwin says:

                                        Jesse,
                                        I’ve read this entire thread, taken a class on ANSI last year, etc… been using the method very closely for 38 years. Had 4 + years of mechanical and architectural drafting before I graduated high school. So I have a little experience in measuring things and drawing them.
                                        You wrote:
                                        “Of course if the county is wrong you make corrections (ie don’t include the 10×12 enclosed porch) but you don’t make up a new measurement (9.9×12.2 because… I guessed). I sincerely can’t be asked to rebut opinions of people who are failing to read the counter point.”

                                        I haven’t asked you to rebut anything if you are speaking to me. You however are the only person that seems to bringing up make believe numbers. Why would anyone take an assessor’s dimensions and “guess” that they are incorrect and make such a minuscule difference as you suggest.

                                        I can understand someone discounting the assessors measurements when they say it’s a 2 story home and several sources note it to be a 2.5 story with 500sf of finished space with a bath on the third level. That’s not make believe. That is data source verification.

                                        You seem to suggest that anyone using ANSI will be guessing and making up measurements. Changing assessors figures to unrealistic degrees of accuracy and without any support from another source.

                                        Not sure how ANSI standard could cause all that.
                                        I’m just trying to figure out how the opponents to ANSI here are determining it to be so harmful.
                                        I just don’t see how it is going to change the results anyone gets by all that much. Some of the changes are not even part of the Standard. They are part of the Annex which is not the Standard.

                                        Again as I mentioned the only time I see concerning differences in appraisal sketches is a result of incorrectly drawing the sketch. It’s a spacial awareness issue, a mis-read measurement issue, etc. I don’t think I can recall a single time when multiple competent appraisers measured a dwelling and used whatever means they desired and had the results have any impact in value comparison. They are all very close. Varied precision used by each but all the results acceptably accurate to the market.

                                        That’s with regard to the subject we get to measure. No guessing there.

                                        Regarding comps. If you have a Comp that the assessor says is 2 Story 3,500sf. The MLS says 2.5 Story at 4,000sf. The MLS listing has a current appraiser’s sketch included indicating three levels and 4,000sf, and the MLS photos show the 3rd level finish is equal to the level below.

                                        I’m reporting 4,000sf and explaining why to client. That’s not guessing and it’s not changing the assessor methods nor results. It happens all time here.

                                        FNMA does not suggest that we guess and ‘correct’ other measurements. In fact they say they know the other measurements might be different but we are to adhere to ANSI. Well in my case the other measurements have always had the potential to be different. I don’t guess what they. I use verification sources.

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                                        • Avatar Jesse says:

                                          The county I grew up in measures one neighborhood to include the second story as GLA, one doesn’t, that’s their standard for each neighborhood, they’re consistent… annoying but consistent. They did this based on who entered the sketch originally. If I use ANSI, I have to then “make up” an open to below adjustment for comps, easily in excess of 150sf. Nearly none of the counties in my area add staircases (I can think of two plans where they were added, and that county measures to the nearest foot). A few staircases is another 30-60ft. So, with ease we now have a 200sf difference between the ANSI measured subject and the county measured Comp. In some markets that’s a ton of money.

                                          If I apply ANSI consistently in analysis, I commit fraud as I am not using consistent units of comparison – OR – I play pretend and make up some number (and that’s not a game I’m willing to play). IF however, I used the county standard as my guide, I have consistent units of comparison. Are they the most accurate… based on what, some arbitrary standard? No. But are they reliable for value determination? YES.

                                          To force appraisers to use a non-credible standard is an act of fraud. To use non-credible standards is an act of fraud.
                                          To use an non-credible measurement standard is a USPAP violation.
                                          I will not be party to FRAUD.

                                          You keep straw-manning the weakest arguments possible. Outside of the ANSI Faithful, no one knows what this made up standard is. The county assessor of the above county openly mocked this new “standard,” and rightfully so. New construction is placed in the public record not by the builder sketch measurements, but by the measurement standard of the county.

                                          So if as you say – “I don’t think I can recall a single time when multiple competent appraisers measured a dwelling and used whatever means they desired and had the results have any impact in value comparison. They are all very close. Varied precision used by each but all the results acceptably accurate to the market,” would you support FNMA forcing appraisers to use a worse standard in the majority of the country? Those who are standing up to this nonsense are doing so because we are critically thinking professionals who know this is 1) at best a waste of time, 2) at worst an invitation to mortgage fraud, 3) another step towards hybrid appraisals (at least they’re still illegal in VA for an appraiser to perform, for now).

                                          GXX001-

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                                          • Avatar Jesse says:

                                            Additionally, I would urge those who advocate for ANSI to read WorkingRE’s article in the latest edition: Stairway to Confusion. Another great perspective on how ANSI is being used to commit real estate fraud.

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                                          • Avatar Chris says:

                                            Are you seriously trying to say that if you measure the property properly using ANSI. With an accurate measurement of the true gross living area, that you will be committing fraud??? Seems to me your reports prior have not represented the true gross living area of the property then, No matter how your assessors measure, you seem to be very knowledgeable on what counties do what, so I am still unclear how you think reporting the actual gross living area under the new guidelines is fraud. My friend, you make no sense, I don’t know how you were doing it before, but either way your measurement should have been very close to the actual gross living area of the property regardless of what tax assessors and counties have recorded. From what I am understanding you are saying is you have provided inaccurate gross living area figures in your appraisal reports. It blows my mind that we are even having a conversation about this.

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                                            • Avatar Jesse says:

                                              You’re reading what you want now. With no basis in the words on the page. I’m not sure how many times I can type this – STANDARD DOES NOT EQUAL MEASUREMENT. You can use the county’s standard and come to a different measurement than the county, but that resulting measurement will be more consistent then applying two completely different standards to your subject and your comps as evidenced above.

                                              IF you use a different standard of measurement for your subject than your comps, you are not producing a credible report. If you use non-credible standards of comparison to derive adjustments, then your value is not credible. If you do this knowingly, you’re committing fraud. If you’re comfortable making up an adjustment to the GLA of your comps based on hunches… go ahead. I don’t find that credible, maybe your peers do.

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                                              • Avatar Chris says:

                                                So what you are trying to say is if your actual measurement is 300 ft² below your assessor’s reported gross living area, you still report the assessor’s gross living area in your report. Because the gross living area figures of the comps would be similarly measured as the subject property was. If I understand you, you are the one committing fraud by misrepresenting the actual gross living area of the subject property based on an assessor’s reported figure. And now when you measure properly, you will have to reconcile the comparables to similar gross living areas as the subject property if they are similar models and then you will have to make a statement in your addendum explaining what you did. No wonder you are so worked up.

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                                                • Avatar Jesse says:

                                                  Misrepresenting according to what? The biblical cubit? Sure, I’ve been way off. Oh… you mean the pretend standard used by nearly no assessors, one of the largest suppliers of real estate data. ANSI is a standard, but not the only one. As Thomas stated, there are other ways to skin the cat, but I’ve presented a very obvious example of where ANSI produces a nearly 10% difference in measurement.

                                                  There is a strong “ANSI is the only truth” mindset among the ANSI faithful. If I paid all that money and then was confronted with clear and obvious deficiencies, WorkingRE articles, classes full of appraisers ridiculing the standard I had adopted, I’d be pissed to.

                                                  Again, if you chose to use ANSI moving forward, and have good market data for these “guesstimate” of adjusted GLA… good on you. I don’t see how that’s credible in my market, and in the review work that I do of ANSI measured work, I don’t see them doing this due diligence that your speak of. For me, in my market, and for all the appraisers for whom the use of ANSI would result in fraudulent reports, I will protest this and every report will be marked with…

                                                  GXX001-

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                                                  • Avatar Chris says:

                                                    So you are saying if you measure your house and it’s 300 ft² smaller than the assessor’s reported figure, you draw your sketch to match the assesses reported gross living area?

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                                                    • Avatar Jesse says:

                                                      The “standard of measurement” doesn’t equal the “measurement” of the county, this has been described at least 3 times so far. No, I use the measurement standard of the county, not the measurement of the county because, in my market, that is the most accurate GLA source (with some exceptions).

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                                                      • Avatar Chris says:

                                                        Well now you have to use ANSI. Not the standard of a measurement of each county. Seems to me they will have more accurate gross living area figures from you. No wonder you’re so upset. Talk about all your comp data being wrong now. Get ready for all the letters asking you why you’re changing your comp data on previously used comps.

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                                                        • Avatar Jesse says:

                                                          Nope, using ANSI would result in fraud in my market. Thanks for playing. Move Along. GXX001-

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                                                          • Avatar Chris says:

                                                            How is using an accurate system of measurement fraud? You are now required to use ANSi, just reconcile your comparables and explain what you’ve done. Time for critical thinking skills and not just that entry.

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                                                            • Avatar Jesse says:

                                                              Yes, critical thinking is keeping me from committing fraud by using non-equal standards of measurement. Here’s the article mentioned above, and I’ve addressed your question at least three times.

                                                              https://www.workingre.com/stairway-to-confusion/

                                                              Stairway to Confusion
                                                              by C. Brett Bowen

                                                              There has been considerable discussion over the years about gross living area (GLA) measurement standards. The ANSI Z765 standard gets the lion’s share of the attention, and is the most widely referenced standard in the industry by far. It can also be the most difficult to interpret, particularly when it comes to stairs. Here’s why.

                                                              It is primarily important to recognize two very important facts:
                                                              1) a standard is nothing more than the definition of a unit of comparison and
                                                              2) it is the appraiser’s responsibility to be consistent with that definition.

                                                              First, what do I mean when I say that a standard is nothing more than the definition of the unit of comparison? The unit of comparison for something is critical to the understanding of that thing.

                                                              If I go to London and buy a souvenir, and the cashier says the price is 15, I need to know what unit of comparison we are talking about. Is that 15 Pounds Sterling or 15 Euros? Did the cashier happen to notice my accent and give me the price in US Dollars? The unit of comparison in this example is the currency. Knowing the currency is critical to my evaluation of that price. The same applies to GLA. The standard defines what unit of comparison we are using. In other words, when I use the term “gross living area,” what do I actually mean? The standard that I’m using is what gives meaning to that term.

                                                              Second, as an appraiser, consistency with the definition is actually more important than which definition is chosen. It is not merely consistency with oneself, or even with other appraisers, which is key: it is consistency with your data which is most important. If you believe that your standard of GLA is best, but those who are reporting comparable sales data are utilizing a completely different standard, it is your responsibility to either change your standard, or convert the data to match your standard.

                                                              Maybe this example will provide some clarity on this issue: Properties A, B, and C are the same floor plan as the subject property and have sold recently. The builder’s architect has reported the GLA of that floor plan to be 2,800 square feet using their standard for calculation of GLA. An appraiser measures the subject property using a different standard and arrives at a GLA calculation of 3,000 square feet. Before the appraiser utilizes properties A, B, and C as comparables, it is imperative that the appraiser recognizes that their standard is inconsistent with the standard which is reported in the market. Addressing the inconsistency is far more important than whether or not the appraiser’s measurements are “right” or “better.”

                                                              This lack of consistency is being a big problem and a big business. There are many appraisers who market their measurement services to agents with the specific understanding that their interpretation of ANSI will likely result in a larger GLA than what is reported. Why is this a problem? Ethics. If I am knowingly using a method of arriving at GLA which is substantially different from the methods employed by most architects, builders, and tax assessors, then the assignment results are knowingly misleading. If I know that on average my method of measurement produces a GLA 5% higher than what is typically reported of my comparables, then choosing that method without dealing with the inconsistency is unethical and a violation of the Uniform Standards of Professional Appraisal Practice (USPAP).

                                                              Consistency
                                                              So how do you deal with the inconsistency? There are two solutions. The first is simply to adopt the standard (or the interpretation of the standard) which is prevalent in my market. The second solution is to revise the GLA of my comparable data by extrapolating what the GLA of the comparable data would be under the methodology utilized by the appraiser. While this solution is theoretically ethical and USPAP compliant, it comes with some obvious flaws in practice. How do you know what the GLA of that comparable would be if it were calculated using your preferred method?

                                                              This brings us back to the confusion regarding ANSI and stairs. While the recent update to the standard (ANSI Z765-2021) provided some additional clarification in some areas, there remains some significant room for interpretation when it comes to the stairs. This is particularly true when the subject lacks a basement.

                                                              Two-story homes are very common in my market but basements are not. A common floor plan includes a switchback staircase to the second floor with a closet underneath which extends several feet under the staircase with a sloping ceiling in the closet. The question is where do you count the stairs? On the first floor, on the second floor, on both floors?

                                                              Increasingly, I am finding that appraisers are interpreting the standard to include the entire staircase on both levels. I’ll be the first to admit that this interpretation has some basis, although it does create some inconsistencies with other parts of the standard, and seems to be at odds with the methods of architects, builders, and assessors (at least in my market). This interpretation relies most heavily upon the illustrations.

                                                              The published standard includes several illustrations which are intended to clarify several elements of the standard, however, the illustrations alone can be confusing, especially if you don’t read the full standard itself. The illustrations depict a home with three levels: first floor, second floor, and a basement. The floorplan depicts a staircase descending from the second floor to the first floor, and then down to the basement. If you just look at the illustration, it indicates that the staircase is included in the GLA on both the first and second floors. However, it is important to read the standard to understand why. The standard states that “the area of both stair treads and landings proceeding to the floor below is included in the finished area of the floor from which the stairs descend…” (ANSI Z765-2021, page 6, emphasis added). The Annex to the Standard, which provides additional commentary, states that “stairs that descend to an unfinished basement are included in the finished square footage of the first level…” The parts of the standard which indicate that ceiling height under the stairs doesn’t matter, all appear to be in the context of stairs on the basement level. Therefore, if there is no basement, then there are no stairs which descend into the basement which should be counted on the first floor. The GLA above grade (ie, the area under the stairs which does not descend into a basement) appears to be treated differently.

                                                              My primary evidence is that of the strict adherence to the minimum height requirements in the same example. In their example, the area which slopes below a ceiling height of 5? is not included in the GLA calculation. Therefore it would be contradictory to exclude such a space in one part of the house and then include space which may have a much lower ceiling or even be entirely inaccessible. In other words, why would an area which has a ceiling height less than 5? under a staircase be counted toward GLA, while an area with the same ceiling height in a living room be excluded? My conclusion is that it is not intended to be treated differently.

                                                              With all of that said, the evidence within the standard for my interpretation is not actually the reason for my methodology. My interpretation closely matches the methods utilized by builders, architects, and assessors in my market, thus providing a consistent unit of comparison which results in credible assignment results.

                                                              I must reiterate that whether or not you agree or disagree with my interpretation is not the point.

                                                              If your data suggests an alternate interpretation, then utilizing the method that I just described may not only be the wrong choice, it might even be unethical.

                                                              About the Author
                                                              Brent Bowen is the President of Texas Valuation Professionals, Inc in Plano, Texas and has been appraising residential real estate in north Texas for 23 years. He graduated from Baylor University with an enthusiasm for both economics and real estate, which made real estate appraisal a perfect fit. Brent is always looking for ways to innovate the appraisal process, and enjoys sharing those ideas with his staff as well as others in the appraisal community.

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                                                              • Avatar Chris says:

                                                                I don’t know Jesse, we are now instructed to use ANSI. So if you do not you are submitting a non-compliant report. Your argument sounds fine by using the same standards however your argument is baseless because now you ever required to use ANSi. Maybe I do not understand properly because everyone I know, knows tax records can be horribly wrong and we have been taught to think critically regarding verifying gross living areas for our comparables, and it’s not hard to do when you can compare your measurements with the assessor’s measurements. So good luck with it, stand on your principles and I wish you the best.

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                                                                • Avatar Jesse says:

                                                                  I think critically about every tax record I research, which is why I look at everyone before I go to the property, and examine it on site to confirm or correct everything on-site to be able to detail every difference – down to the unit of measurement that the county uses. This is how I know my market data. The use of ANSI in some markets will result in fraudulent reports. It seems you’re convinced that’s not the case in your market. Great for you. Allow us to be professionals who understand our markets though.

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                                                              • Avatar Thomas Baldwin says:

                                                                Re: The staircase closet issue. He like many others is way over thinking this…

                                                                You have a staircase… Count it. the fact it has a closet makes no difference. The closet is within the area of the staircase.

                                                                Staircase counts on finished level from which it descends and the finished level below. So it matters not if a closet exists. It is absorbed in the staircase.

                                                                He also is mis-thinking in my opinion of the varied GLA results. Architect, Assessor, Etc. He leaves out the key element and the heart of the appraisal…. His OPINION. He is supposed to use ANSI and then reconcile it to the comparable data he has. Adjust or don’t adjust and explain why or why not.

                                                                What does he do when he gets Plans and Specs and the Architect says 3,000…. the Assessor has measured and says 3,075 and he measured it at 3,150… Let’s say that happened in 2018 before the ANSI scare. OMG how did he reconcile that? Three different standards. Three different results. Would the ethical thing to do be to notify the client, turn down the report, and suggest fraud may be or become present? Come on. No, it would not have happened like that in 2018 and it will be no different with ANSI in 2022.

                                                                I don’t know what world the rest of you live in but that has been life since day one for me as far as appraising goes.

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                                                              • Avatar BA says:

                                                                Thank you for a very complete and logical opinion on this issue. I agree and feel it is possibly an ethic violation as you have stated here. I guess we will see if /when the higher levels begin enforcement actions.

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                                                              • Avatar BA says:

                                                                Great read thank you

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                                          • Avatar Thomas Baldwin says:

                                            Jesse,

                                            ” 3) another step towards hybrid appraisals (at least they’re still illegal in VA for an appraiser to perform, for now).”

                                            When you write VA do you mean Virginia? I am from Central Virginia. Which county does not report area above the second floor as living space?

                                            Your comment is somewhat confusing..

                                            one doesn’t, that’s their standard for each neighborhood, they’re consistent… annoying but consistent.” I’ll break it down and maybe you can clarify… but if this in Virginia can you give me the county or neighborhood or maybe two addresses so I can see what’s going on.

                                            “”The county I grew up in measures one neighborhood to include the second story as GLA,” —- Ok, I’m with you here… seems pretty normal.

                                            “one doesn’t,” — One ‘what’ doesn’t? One other county?

                                            “that’s their standard for each neighborhood,” — that’s whose standard for each? that would be two standards. Are we talking two standards for one county? Two standards for two counties?

                                            “they’re consistent… annoying but consistent.” — this statement can only be if we are talking about two counties. Otherwise the one county has two standards that are anything but consistent.

                                            Again I see no need for you make up numbers. Let’s use an example from the assessor that has their head up their…. I mean the one that doesn’t count 2nd story GLA.

                                            You measure your subject per ANSI
                                            1000 down
                                            500 up

                                            They report 1,000 total.

                                            You report 1,500 on GLA line. Because that’s accurate and the truth. Or if easier you could report 1,000 and place the 500 on an other item line.

                                            Either way you need to explain why this is done. Then for the comps you must have some knowledge as to the 2nd story. Otherwise you would not know it’s not being reported. In fact you must have some knowledge as to it’s size, functional utility, finish, etc.

                                            So basically you have a lot of narrative to write explaining that you best data is perhaps from your files, MLS, etc. You can then place a note the 2nd level GLA is estimated and from what source. You claim to know what the areas of concern area in SqFt but for some reason also need to ‘invent’ them?

                                            “If I apply ANSI consistently in analysis, I commit fraud as I am not using consistent units of comparison” Yes you are. The unit of comparison is the SqFt.. It’s your job to measure and report the subject accurately. Then analyze the data available to you and apply it in context to YOUR work.. not the work of some guy 60 years ago that the assessor still follows.

                                            FNMA is telling you.. look measure to ANSI, then regardless of how, when or why you data develops, if it doesn’t align to your ANSI finding, just tell us how you think it should be handled,,,, but don’t defer back to some other “this guy from the 1920s methods” standard.

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                                            • Avatar Chris says:

                                              Well said!!! My guess about the second floor was attic area whether be a one-story rancher with some attic or a two-story house with an attic finished, I put finished attic on the open lines at the bottom of the grid all the time, I know appraisers who include finished attic and gross living area but then they have to compare it to much larger differing types of properties and their reports make no sense. Which is why they want us all to use the same system of measurements, they should have done this 30 years ago and the realtor should be forced to use the same measurement system and be taught how to accurately measure properties without worrying about liability of course.

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                                            • Avatar Jesse says:

                                              This isn’t the 1920 measurement, this is in new construction in the greater Richmond area, are you looking at assessment records? Hanover County, the plans north of Pole Green Road are a great example, its been a few months since I did one there and I’m exhausted of what is basically a USPAP scope of work discussion. The assessor who entered one plan included all the open to below, the assessor who did another didn’t. It’s annoying, but it’s consistent per plan. Hanover doesn’t include staircases at all (pockets of Chesterfield do, they measure to the nearest foot, etc, etc ,etc).

                                              If I use ANSI in the plan that included the second floor open to below, I short my subject 100-200sf In value because I used a measurement that’s not credible. Could I make up an adjustment to the GLA, sure, but I don’t find that credible. I’d rather use the standard that the county used for those properties. It doesn’t make for a clean CU, but that’s not my problem.
                                              My report is accurate, and I didn’t have to make up an “open to below” adjustment, a “staircase” adjustment, et al. Why… because I use the same standard of measurement.

                                              While I understand that the “SqFt” is the unit of comparison, you’re straw manning again. The Sqft you get from ANSI and the Sqft your get from the county assessor is not always the same, therefore the units of comparison are NOT the same if you use two different standards of measurement. This is why Chris has been so adamant that you need to “think critically” and make changes to the comps to bring them into ANSI… based on…something. Can you do that… sure, but as the WorkingRE article says, you’re opening yourself up to a lot of questions.

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                                              • Avatar Thomas Baldwin says:

                                                Ok, look I’ll tell you this much.

                                                I work in Central VA. Richmond, Hanover, Chesterfield, Goochland, Powhatan, Henrico, New Kent, King William, Louisa ( mostly Lake Anna water front ), Caroline county, Powhatan, you get the idea.

                                                About 38 years ago myself and another beginning appraiser that is a prominent name in town stated work at an office. There was one other “beginner” .. he had just retired as a local assessor. We had a buider / appraiser present, and another couple of appraisers. Plus a full sales outfit.

                                                I later worked with another retired local assessor that is now one of the biggest top producer sales people in town.

                                                I have seen the work, been taught by, been friends with, reviewed, or been asked to appraise for the biggest names in the Richmond metro. what I mean by that is not that I am any better than someone else, it means I have seen a =LOT= and/or have a =LOT= of other appraiser’s work. Thus far everything so closely resembles ANSI that a change to ANSI would be insignificant.

                                                I have never seen it done the way you describe. … and yes I look at the assessors cards. I used to sit for hours on end at Hanover and Henrico flipping through property cards.

                                                If you are talking about new construction just call the builder. Most builders even have the floor plans on their web site.

                                                I can’t think of anything I have done lately new construction north of Pole Green although I think I did do a review over there recently. At any rate you made it sound like Hanover county didn’t count all of second floor. I assume now you are speaking of two story foyers.

                                                If you know or have a very good idea as to the situation just equate the situation. You don’t have to “cheat” you subject just because you use ANSI.

                                                Believe me based on the review work I do and all the work I have seen and been a part of for the past 38 years, either I am misunderstanding what you are writing or you are the guy that is doing it differently from the vast majority of your local colleagues.

                                                BTW, will you do me a favor. Tell all the appraisers you meet in this region to arrange their reports such that when they have more than 3 comps to put Comps 4-6 page directly after Comps page 1-3. I don’t why everyone insists on placing the addition comps at the end of the report. It’s incredibly frustrating to read in review.

                                                If you think your addendum are going fly more power to you. It’s your work and your opinion.

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                                                • Avatar Jesse says:

                                                  My peers do a lot of interesting things, like including split foyer/multi-level basements in the GLA. Lots of complaining there too (as if FNMA hasn’t been clear in the selling guide for 7 years). We can agree on one thing, appraisers who don’t put their 4-6 comps directly behind 1-3… are strange. I hate seeing that too.

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                                              • Avatar Thomas Baldwin says:

                                                Jesse,

                                                “Hanover doesn’t include staircases at all”

                                                Can you go here and explain to me how the staircases are -not- being counted. Built in 2019 north of Pole Green Rd. Note that stairs are on side of home opposite garage and the skectch clearly indicates all that area is two story ( counted twice )( Per ANSI: Include from descending and area below. in this case 2nd and 1st )

                                                https://parcelmap.hanovercounty.gov/

                                                Search for 7774 Millikin Ln

                                                It’s a dead ahead two story. No vaults, no two story foyers. Sketch is present on Residential Improvements tab.

                                                It’s your MLS #2125326
                                                As seen here on realtor.com
                                                https://www.realtor.com/realestateandhomes-detail/7774-Millikin-Ln_Mechanicsville_VA_23116_M97506-02322

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                                                • Avatar Jesse says:

                                                  Was referring within the context of the post, with open to below space, the stairs aren’t included in the second level. Of course Hanover includes the stair case in properties that have no open to below. There are a lot of plans north of Pole Green, as I said, I’m exhausted by this scope of work debate, as USPAP has said it all.

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                                                  • Avatar Thomas Baldwin says:

                                                    Ah…. ok… well go back to the link at Hanover and type in 4806 Queen Carolyn Ln.

                                                    You have roughly a $700,000 home. That’s where your comps will be. $650 to $725 if you are real lucky. and that 40sf for the stair case is what you believe reason enough to not apply ANSI to your subject. So you have a 1/2% on one comp for a staircase GLA situation in that part of Hanover. You get to the bottom line and say it adjusts to $690K just add a 1/2% in your mind/notes.. $693,450. That’s just one comp. I don’t know anyone that can tell if a property really worth $690K or $693K but even if they could ANSI would not be in the way.

                                                    All the other unknowns are ok, but knowing there is maybe 40sf of stairs there is an issue. You don’t want to allow for 40sf because whatever. You know for a fact it has been omitted. You know roughly how large it must be. but it would be fraud to mention it and handle it. Hell subtract the staircase out of your subject, place it on a separate line at bottom.

                                                    Staircase – Staircase – Staircase – Staircase — Boom 3 comps no adj. All GLA aligns to county and your subject is measured to ANSI standards. ANSI does not define how you REPORT. GLA is not mentioned in ANSI.

                                                    There was a joke going around one of the shops here a long time ago. It was back when the market was booming. I think one guy had an order in like Mooreland Farms or something. It was a really expensive home, and the guy appraised it for like $3K less than the sale price. One guy chimed in and said ‘you realize you just cut an appraisal for what amounts to an upgrade on a refrigerator in that neighborhood. LOL, not even the whole fridge just an upgrade. Everybody busted out laughing.

                                                    Oh well, one man’s tree is another man’s forest.

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                                                    • Avatar Jesse says:

                                                      Still as strawman, still not recognizing that this can be up to 10% of the GLA… and personal property can’t be included in an appraisal, so not sure how a refrigerator upgrade is relevant: B2-1.5-03, Legal Requirements (06/03/2020). One man’s fraud is another man’s gray area.

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                                                      • Avatar Thomas Baldwin says:

                                                        You totally missed the point. Re-read what I wrote. The joke was that the appraiser thought he knew better than everyone else to a ridiculous point of precision. No one made an adjustment for a refrigerator.

                                                        I guess you never appraise properties with wine refrigerators, bread warmers, ice makers, aux freezers, SubZero fridge,….. all built in and what one finds in the property and location I mentioned.

                                                        Ah, the ole Strawman comment. What a joke.

                                                        Jeese, I have been recognizing the inaccuracies of tax records for 38 years here in Richmond. So have most of the Appraisers and Brokers I have been associated with. We have never had an issue communicating that to our clients.

                                                        You keep throwing the word fraud out directed at anyone that has and/or will be following ANSI. I assume that you must also be an attorney. Why don’t you contact FNMA and set them straight?

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                                                        • Avatar Chris says:

                                                          I think Jesse has been misrepresenting his gross living areas by using what the tax assessors report, I am not sure how he has been drawing his sketches, but I don’t know how you draw your sketch after measuring her house and then try to match that to tax records. I have seen appraisers copy and paste the assessor sketch to their reports without ever having to measure the house. After I measure the house the square footages are obviously always incorrect and then the comps need to be readjusted within the body of the appraisal. I have no idea why he keeps bringing up the word fraud, and when you measure a house and other appraisers measure a house it should be within a couple square feet of each other. And Jesse never answered my question of what he does when an actual gross living area figure is so inaccurate compared to the assessor’s figure. I think Jesse is projecting that he has been in fact committing fraud every time he misrepresents the actual gross living area of a property. If somebody else can give me their opinion on my opinion I would be greatly appreciate it, because I keep trying to understand what Jesse says and it just does not make sense.

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                                                          • Avatar Thomas Baldwin says:

                                                            Chris,

                                                            I’m not sure what he’s doing. I couldn’t figure out how I could not know who he is when I realized he is from my area.. I got mixed up and thought he had been appraising for 30 years. That was another person’s post. Anyway he has only been appraising here for 2 years. I read through his web site blog. He has some interesting perspectives that differ 180 from my experience but hey…

                                                            Anyway, I’m pretty sure by May of 2022 everyone will be on the ANSI train. Same ole song and dance. If FNMA said from here on out you have to take two photos of the front of the dwelling several appraisers would say “oh hell no” like it’s some big deal.

                                                            I can remember years ago. Seems like 15+ now, my appraiser friend called me up and asked me how I measured fireplaces ( on the outside ). I said what are you talking about? No I don’t measure that. His reply, well I just took an ANSI class and we are going to have to do that. I said that’s crazy. He had gotten mixed up, called me back. ‘No, it’s ok, I was wrong, we are already basically using the ANSI system the way we have been doing it.’

                                                            Wouldn’t it be funny if on April 1, 2022 that FNMA says “fooled you didn’t we?”

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                                                            • Avatar chris says:

                                                              Thank you for your response, I just couldn’t figure out why someone would be so upset to call measuring with ANSI would lead to a fraudulent report. Crazy. But he seems to be pretty firm about it. Everyone should b on the same page regarding attic and other spaces, I am so tired of hearing why we dint include a finished attic as GLA, That is when I make a line item adjustment for finished attics vs. unfinished attic, so simple. And I still don’t know how someone can include the 2 story open to ceiling family room or an open foyer as GLA just because the assessor does. Crazy !!!

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                                                            • Avatar Jesse says:

                                                              Been appraising 5 years. Your ability to research speaks for itself.

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                                                              • Avatar Thomas Baldwin says:

                                                                I said here for 2 years. As in central Virginia. Here, I’ll quote it for you…. “appraising here for 2 years.”

                                                                Initial Certification Date2020-02-13
                                                                Rank Effective Date2020-02-13
                                                                Expiration Date2024-02-29

                                                                As you noted earlier, the concepts you have mentioned were all related this locality. Hanover, Chesterfield, local customs, etc..

                                                                I know you got your license for a few years in PA as well but that has nothing to do with the comments you made about specific local issues.

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                                                      • Avatar don says:

                                                        Personal Property SHOULD be properly described and documented with supporting info. PP ain’t necessarily appliances, they are frequently things like Water Shares, or Shares in a sewering system, etc.

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                                        • Avatar Chris says:

                                          Well said !! The tax records and public records we have access to now gives us the ability to correct a wrong gross living area for a subject property that we have measured. I have yet to do this because a liability concerns, but it could save many homeowners from having to pay access taxes in the future. As I will be retiring in the next couple months, I will leave this up to the younger appraisers to deal with. The goal is to give more accurate data so that all of us in this industry can work together to get these loans done, for 30 years I have been hearing appraisers cry about being replaced and I have not seen that happen nor do I foresee it happening.

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                        • Avatar Thomas Baldwin says:

                          I have to agree with you chris. For someone to suggest that using ANSI is fraud is quite hard to believe. By that logic, here in my market, practically every appraisal written for the last 40 years by every appraiser is fraud.

                          “The Market” Basically being the MLS, Agents, Buyers, Sellers, Brokers, basically lump all Finished Sq.Ft. into one lump sum. Above ground, finished over a detached garage, basement finish, etc..

                          It has only been in the past several year that our MLS would even report basement finish and many agents still don’t know how to report it correctly.
                          Yet we appraisers follow FNMA direction and break all those items down. Contrary to what “The Market” is doing.

                          That is not fraud. If anything it would be fraud on the part of those that publish “The Market” data.

                          Agents want a 1,000sf ranch with a finished basement to look to the public as a 2,000sf dwelling in marketing.

                          I have requested for multiple decades that our MLS would simply break down their reporting to show Above grade, below grade, etc. Finally they changed a few things. What the people that control the market and MLS came up with is this…..

                          Ranch 1 story
                          Finished SqFt. – 2,000
                          Finished SqFt in Bas. – 1,000
                          Unfin.Sq.Ft. in Bas. – 0

                          Now you might think that is 3,000 SqFt of finished space. 2,000 above grade and 1,000 below. But no, it’s a 1,000 SqFt ranch with a 1,000 SqFt finished basement.

                          As I said, even via that convoluted “newly updated system” many agents either ignore the basement fields altogether, report them incorrectly or some other combination.

                          Now the assessor will use a different system. So for every basement home I have to compare the numbers used and determine how they came to be as best that I am able.

                          So this argument about ‘can’t use ANSI because that’s not what the market is doing’ makes no sense to me. I can use ANSI, but I will still have to figure out how reliable the comparable data is, or which comparable version is most accurate if they differ. That’s just the nature of my market and the elements that control our MLS data ( hint:it’s not the appraisers ).

                          I think what FNMA is doing is short sighted but it’s no big deal for me. I think they have created a complex solution for a problem that doesn’t really exist.

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                          • Avatar raymond says:

                            ANSI should be a big deal for those still doing mortgage appraisals. The Desktop Idea is more of a big deal. Boy, its amazing how major clients for appraisers can tell appraiser how to do their job. Has anybody, out there, ever told their dentist how to fill their cavity, how fast to do and what their fee will be. LOL

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                            • Avatar Thomas Baldwin says:

                              raymond,

                              “ANSI should be a big deal for those still doing mortgage appraisals.”

                              can you explain why?

                              I do some mortgage work. I do not do Desktops. I tell my big name clients what my fees are, how much time I will need. I’ve been using about 95% ANSI for 38 years.

                              How is it going to be a big deal for me?

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                          • Avatar chris says:

                            Thank you for the support,

                            I just don’t understand some appraisers acting like the sky is falling in…..our industry is always changing, get over it, frankly we all should have been on the same page with measurements 30 years ago.

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                            • Avatar Koma says:

                              Chris, For someone telling others to get over it you sure can’t. Over a month of posting and you’re the one still freaking out. WOW!

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                          • Avatar Chris says:

                            I agree with you 100%, the latest travesty is one county just reassessed, and they round it up every figure so in order to get the sketch to close some walls could be three four feet larger than they should be adding hundreds of feet to the subject properties and our comparables. We therefore now have to use our critical thinking skills after measuring the house and compare that figure to the assessor’s figure and then start making some blanket statements about reconciling the comp similarly. The benefit is this is that the lenders cannot trust assessor data and we appraisers get to keep our jobs.

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  46. Avatar PJTMC says:

    Thank you for making my point….

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  47. Just a reminder that this blog is for appraisers but not a place for colleagues to disrespect one another and no place for rude and snide comments.

    We encourage lively debate, but ask that you be respectful of others. If you disagree with someone, please express yourself respectfully. If you disagree with an opinion, feel free to respectfully challenge that opinion. Do not engage in personal attacks (including name-calling) on fellow commenters/appraisers. Please keep it professional and conduct yourself as you would within your own organization. Snide or rude comments are not constructive and certainly not helpful. We count on your cooperation and appreciate your support!

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  48. Avatar Tammy says:

    I agree I would be more worried about Desktop/third party sources measuring the home. To be honest I believe this whole ANSI is for the 3rd party sources they will be using to do inspections, not necessarily the appraisers. Just a thought.

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  49. Avatar CJK says:

    I just took a 7hr course on ANSI, just to find out that I have been measuring homes like that for 39 years. As for the desktop reports, I will let others do them. I never had an issue with the desktops, but I will not sign off on another person’s inspection and sketch. In one course I just took, the lawyer said that 60% of the complaints against appraisers were over square footage. Just remember the same people who are pushing this will be the same ones who will file a complaint with the state when the properties end up as REOs. As for the state regulators they will look for any reason to destroy you with USPAP violations. They need to generate income, my board sent me a 5 page letter telling me that they would not give me credit for some of my CE, which was funny because my classes were approved by the Real Estate Commision, hypocrisy has no bounds.

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    • Avatar Chris says:

      If appraisers were taught to measure properties accurately, using ANSI is not a big deal. But only to those appraisers have been using assessor data and falsifying their sketches to match tax record gross living areas, I did reviews for 5 years and I know the appraisers who are too lazy to actually measure a house. I know this because I told my lenders I have to do inspections and order to give them a value and since they needed a new appraisal they said go ahead, I was then able to compare sketches to my sketches and could easily see who wasn’t bothering measuring. Can you imagine reporting a gross living area and not measure the house. Blows my mind, but that is why the appraisers are considered what we are today, because of appraisers like that not doing the job.

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    • Avatar Thomas Baldwin says:

      “I just took a 7hr course on ANSI, just to find out that I have been measuring homes like that for 39 years.”

      Exactly what I expected. This comment about a small percentage of the country using ANSI I believe is a canard. I think everyone I have ever met uses a method that is so close to ANSI that any difference would be minuscule.

      It may not be a State, City, or County standard…. but the appraisers are following it to a very close degree.

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  50. Avatar EJ says:

    90 days until retirement !
    Have fun
    Good night

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  51. Avatar Chris says:

    Just got back from Asia after 2 months vacation, I only read this post a couple days ago. I am just having trouble understand that why somebody, especially state certified appraiser, would say using the standard measurement would be considered fraud. Could you please explain that to me?

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    • Avatar Red says:

      There was a lot to read to get up to this point, however, I think you are missing the point about the potential for fraud (at leas from my perspective). It is not difficult for an appraiser to measure a home to ANSI standards. But, if it is a known fact that most or none of the county assessors in your service area use the ANSI standard, and virtually no realtors use the standard when reporting GLA in their listings, it forces the appraiser to make guesses as to what the GLA of the COMPARABLES might be. It is not the measurements of the subject that I am worried about. I live in the Denver Metro area, where there are a great deal of multi-level and bi-level properties. If I were able to measure each of the comps, then it would be no problem. But since I value my life, there is no way I am going to do that. Even the best “guestimate” from a seasoned, well educated appraiser intimately familiar with his/her service area could potentially be off enough that it could materially affect the value. Additionally, there are instances where there are multilevel homes homes with one partially below grade level and one completely below grade. The assessor, MLS listings, and the market all consider the partially below grade level to be GLA, not basement area. Now, let’s say I have one comp which happens to be a model match, but the lower level on that one is completely above grade, unlike the subject which is 1 foot below grade. Isn’t it misleading, or at the very least, confusing to the typical reader of the report to show the subject as having far less GLA but a much bigger basement when they are exactly the same home with the only difference being 12 inches of dirt on the front side of the home? The lower level of the subject and the basement could not be adjusted at the same $/sf. Most readers would be confused as to why the comp is more than 25% larger in GLA with a wild adjustment, but then see an entry in the “additional features” showing the difference in GLA and just making the same, but opposite, GLA adjustment so the adjusted values show like they are supposed to? I am guessing that you may live in an area that does not have multi-level or bi-level homes. In that case, it is understandable why you might think it is a bogus argument. But in a market with many many many multilevel/bilevel properties with many different floor plans, the danger of turning in a report with guesses about the comparable measurements is very legitimate concern. An occasional extraordinary assumption is one thing, but to be consistently guessing GLA on every comp in your report is a whole other ballgame.

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      • Avatar chris says:

        I am amazed that there are so many worried about “guesstimating” the actual GLA of a comparable, doesn’t matter design, you look at the comp, look at assessor drawing, look at what the realtor has down as room sizes, old files where the appraiser measured a similar model…etc….I have a hard time believing that appraisers around the country has been mis-reporting the ACTUAL GLA of a property because they cannot look a comp and use coital thinking skills to estimate the comp being larger or small in GLA. Think about sitting in a court room and some lawyer killing you that you have been an appraiser so so many years and you cant look at a comp and estimate the GLA…..

        The comment you use is ” comp #1 has been similar reconciled in GLA as it is the same model as that of the subjects.” As to the ocher comps you have to made your best judgement…just use a comment that sometimes the appraiser has to use an estimate of GLA as the assessor includes open to above area as GLA or includes the garage or a finished basement or a beloew grade area…etc, ext…..and the appraiser has the right to amend the report if better data becomes available. NOT a big deal people……just need to get those brains working again and not be form fillers or to just lazy to think. I have a hard time believing appraisers out there have been supplying the wrong GLA by including an op[en to below area for large 2 story family rooms. Blows my mind !

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        • Avatar Red says:

          I definitely don’t agree with the open area of a two story being counted as GLA. In 22 years of appraising, I have never seen another appraiser even do that, so I am unsure how the other guy has been doing it that way for so long without any problems. However, as far as being in court, I would rather explain why I won’t just use unverifiable guesses, rather than explaining why simply putting in a comment relieves me of any and all legal repercussions if I happen to be wrong. But, since you are retiring soon and moving to another country, I can see why you have a more cavalier attitude about it since it won’t really affect you. Again, it is not the use of ANSI standards that is the problem. Measuring a house isn’t that difficult. The problem is that only one of the links in the chain (appraisers) are forced to follow a rule, but none of the other links (real estate agents, assessors, builders, etc) are required to follow the rule, and then appraisers gets blamed when the chain falls apart. But, I do wish you an excellent retirement at such a young age. I can’t deny that I am jealous!

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        • Avatar John L Daley says:

          Hey Chris. Appreciate your comments. Can’t argue with anything you say. In fact, rules change constantly, and we always get these friendly reminders to be in compliance. I accept that. The issue I have….like every change for us….is that we will be called on the carpet by the UDCP to explain our measurement being different than the last appraiser’s measurement, and the county, and the listing agent, and even the builder. It always comes down to us. Two things to note. I hate when the mortgage process goes backwards because of issues. The consumer always loses. I get when mistakes happen. But when petty crap comes back it delays the process. And you and I both know that when they control more of what we do, the less our opinion matters, and the more work it takes to keep the process moving. I feel sorry for consumers. Then again, I want to be paid for the extra work it takes me when I am off by 100 SF from the UDCP findings, and the appraisal comes back to me to explain it. Even when I am right. More control by Govt means more pain.

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          • Avatar Chris says:

            If the underwriters are bothering you they clearly did not read your comment that said due to assessor and realtor misreporting of actual gross living areas the appraiser has made an estimate. This is completely acceptable because we are the professionals and I find it hard to believe out there that are misrepresenting the actual gross living area of the home just because the comps have been misreported. I’m a 30-year appraiser and appraised more counties than I can count and at no time did we ever be constrained by assessor figures and underwriters. Put that comment at the top of your addendum so they cannot miss it and you have no liability cuz the underwriter signs off on it when she looks at your comp photos and says yes this one’s a little smaller this one’s a little bigger the report makes sense. And again I say I cannot believe appraisers are counting open two-story family room as additional gross living area it is one of the most absurd things I’ve ever heard in my career.

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            • Avatar John L Daley says:

              Regarding your statement that UW are not clearly reading my comments. It doesn’t matter. Not sure where you are from, but I guarantee a majority of UW are not competent enough to understand appraisals and rely on UDCP results to help them. You answered my point. Appraisals will get kicked back because of UDCP results….just like it happened when the 1004 form was changed….until everyone gets more educated or finds there is a reasonable balance in the differences we as appraisers have in our appraisals. I don’t really care about your last comment about two story homes. I agree with you. You and I are still being scrutinized by the UDCP when our results are different. And that is what pisses me off. Wasting time trying to explain to UW what you already said in your appraisal. I get what you are saying. But we have to have faith that most of us get what we are doing. By the way…I am a 35 year person in finance, accounting, and appraising. It doesn’t matter. Its about Govt taking control of our industry. The fact there are GLA differences is a joke. You know the value before you even do the appraisal. We are all being played.

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              • Avatar Chris says:

                We are not being played John, it is ridiculous for somebody to include a two-story family room as gross living area. It doesn’t matter what the realtor is called a GLA or what the assessor calls the GLA. Or even the fact that you have to explain to an underwriter why there is a difference between the assessor’s GLA and the actual GLA. That is part of our job. It’s not about government takeover, it’s a bad a standardization of measuring throughout our country. And if the appraisers have been using the right system from day one, they would not have had to come out with this. I am in Pennsylvania, we have never had a problem with an actual gross living area measurement compared to what an assessor has reported, so I’m just amazed that there’s such an uproar about properly measuring a house. And it seems from your comment that you’re more upset that a government is telling you what to do. It seems to be pretty prominent these days. The fact is when a comp is misreported and gross living area, it is up to the appraiser to explain that it has been misreported. And I’ll say it again I’m amazed that we are even having this conversation regarding measuring properties, some appraisers want to use gross building area when they’re supposed to be using gross living area. It’s really that simple, they have been doing it wrong most of their careers.

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  52. All heated area is GLA even if the living room has 12-foot ceilings up to the second floor. There is drywall, electrical, perhaps plumbing etc. That’s why the new ANSi rule sucks

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    • Avatar Thomas Baldwin says:

      What does the ceiling height have to do with it? You lost me.

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      • Avatar chris says:

        Martin Cahn wrote……”All heated area is GLA even if the living room has 12-foot ceilings up to the second floor. There is drywall, electrical, perhaps plumbing etc. That’s why the new ANSi rule sucks”

        I still don’t understand why these appraisers are so upset about using ANSI? Am I missing something???

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    • Avatar chris says:

      What does a 2 story open to the 2nd floor and ceiling height have anything to do with measuring a houses’ floor plan for GLA, or a 2 story open foyer???

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  53. The new ANSI says we should not count open areas anymore, I’m saying that’s incorrect.

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  54. The new ANSI standard says we should not count open areas anymore, I’m saying that’s incorrect.

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    • Avatar Thomas Baldwin says:

      You don’t count the open area on the level you are standing on ( typically the 2nd level ) as Sq.Ft.. Basically if you can’t walk on it, it doesn’t get counted as Sq. Ft. towards that floor.

      It doesn’t mean you have to ignore the architectural style, quality and detail.

      I still don’t get the 12′ ceiling room situation. We have homes here that are two story and the 1st level has 12′ to 14′ ceilings. The second level might have 10′ ceilings. If the house is 20 x 60 it’s a 2,400 Sq. Ft. house.

      1
      • Avatar chris says:

        I agree, maybe that is why I am confused, they want to put that “open to below area as GLA because it is “inside the house and should be given credit. But they want to add GLA (if the assessor does” and not make a design adjustment instead. I think I also understand they do not want to stop using assessor figures and instead must do things the right way now…OK I got it….I thought I was missing something, Just got have Asia after 2 months, still fighting jet lag a bit and getting my appetite back on USA time. Its a 12 hour difference…I reviewed reports for 5 years and saw things that boggled the mind on what some appraisers try to get away with….

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  55. That’s completely wrong you do count areas of the 2nd level or any level if it’s heated and within the exterior walls as GLA. It’s always been this way. If the 1st level is 40 x 40 and the 2nd is 40 x 40 measuring the exterior, but 10 x 20 open to the level below is open, you still include the 40 x 40 as GLA on both levels.

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    • Avatar chris says:

      No you don’t !!! No wonder you all are so upset, If you can NOT stand on it, its NOT gross living area….Read the definition of Gross Living Area…..just make a design adjustment. So some of have inflating the GLA by not deducting open to below areas…..Classic !!!

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  56. Here is one short paragraph from an old Appraisal Insititute Q & A pamphlet (During the home inspection, the appraiser will measure your home by its outside walls instead of by the interior surfaces. This will actually make the total square footage slightly larger as the space between the exterior and interior walls is included in the measurement.)

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    • Avatar Steve says:

      ANSI = “Walkable Square Footage”

      Thus the rule about 2 story foyers and ceilings with <5' clearance.

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      • Baggins Baggins says:

        Let me tell you about the time I appraised a mountain home quite literally built for height challenged persons. True story. I was like, this is what it must feel like to be an 8 ft tall human.

        Specialty housing exists and some people don’t want maximized height. ANSI like totally ignores a thousand different specialty housing types.

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  57. Here is another Note the date on this article (How Appraisers Measure Square Footage
    Appraisal Process / August 25, 2020
    Knowing the total square footage of your home is essential to determining its value. In fact, the total heated square footage is one of the primary factors that a residential real estate appraiser will consider when assessing your home’s value. As this information about your home is so important, the appraiser will carefully measure your home during the inspection phase of the appraisal report. When the appraiser measures your home only the heated square footage will be included in the stated gross living area on the appraisal report. This includes all of the living space and rooms that are heated and cooled under the same roof. For example, an outdoor patio would not be included in your home’s heated square footage, but an enclosed sun-room connected to the AC unit would be. The reason your home is measured in this way is that only the livable space of your home is relevant to the appraised value, and outdoor living spaces, such as decks, are better reported as amenities to your home.)

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    • Avatar Thomas Baldwin says:

      That is a brief summary to layman. We don’t measure by the manner you describe down here. I’ve never seen a sketch from any appraiser than doesn’t take out the open areas.

      The assessors also remove the open areas.

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      • Baggins Baggins says:

        Obviously the heated area as qualifiable square footage does not work.

        I like the ‘walkable square footage approach’, less the bias applied to smaller people.

        ANSI group is like all sorts of biased. They reject specialty housing for small persons. They reject cool comfortable garden levels for those adverse to super hot homes with high energy use. They hate on voluntary engagements and want to turn everything into a scary dungeon basement where clowns live.

        1
  58. Well Chris, all i can say is you do it your way, and I’ll do it the right way. However, scuttle-but has it, FYI Fannie is in the mist of retracting the use of the new standard because they realize it’s wrong.

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    • Avatar Thomas Baldwin says:

      “FYI Fannie is in the mist of retracting the use of the new standard because they realize it’s wrong.”

      That would be a smart move on their part.

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    • Avatar PJTMC says:

      Hmmm, perhaps someone at FNMA is monitoring the appraisers blogs?

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      • Avatar Thomas Baldwin says:

        They would be wise to. The Anex of the Standard has a sketch in it. It looks like a cross section of a Cape Cod. The grade is drawn in a the dwelling is above grade on the front and just maybe a foot below grade on the rear. Crawl space below.

        The comments say to report the that entry level as below grade. So let’s say the upper level is just a finished room.

        That means the report will show maybe a 600 GLA with no BR and no Baths then say a 1200 fully finished basement with 3 BR and 2 Baths. Everyone is going to love that.

        The general concept of ANSI is fine but FNMA can certainly screw it up. Plus appraisers will have little ability to work with ANSI to get clarifications and changes suited to appraising.

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    • Avatar Thomas Baldwin says:

      North Carolina adopted a standard for all their agents and appraisers….

      From their guidelines…… Re: Stairs
      r. If the opening for the stairway exceeds the length and width of the stairway, deduct the excess open space from the upper level area. Include as part of the lower level area the space beneath the stairway, regardless of its ceiling height.

      They also include a sketch showing the two story foyer removed.

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    • Avatar chris says:

      LOL…if there is not floor to stand on, its not GLA…I can not even believe we are having to talk about this…..its a design adjustment…… You are putting the value of a 2 story family room, under gla, not design….LOL OK i get it now why they are freaking out over ANSI…. Now I get it…..LOl So what you are saying, if I build a 2 story 40′ x 30′ with 20 foot ceilings and only 1 floor, the GLA is not 1,200sqft, its 2,400 sqft house ?

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      • Avatar Thomas Baldwin says:

        That seems to be what they are saying. I’ll have to find a photo of a place I appraised and see how they would measured it.

        Go to photos 19-21 to see the expansive open areas. I don’t know anyone that would measure all that open area as GLA. … and yes you have to compare it to like design or make a design adjustment.

        https://www.redfin.com/VA/Richmond/513-W-7th-St-23224/home/112982867

        … and from this very forum. A Washington State appraiser..

        https://appraisersblogs.com/appraisal/what-is-gross-living-area-and-what-does-it-include/

        bottom of page.

        “Upper floor areas with space ‘open to below’: if you can’t walk on it, it’s not GLA! (angel wings don’t count!)”

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        • Avatar chris says:

          Exactly……After 30 years of appraising, nothing surprises me anymore. I had an appraiser who went over a mile away in Philadelphia, from the low economic area, jumped across main streets and used 3 comps that were all shells, gutted down to the brick walls as comps for a newly renovated house. The problem was there were 5 renovated sales on the Block, all sold within a few months….He over appraised by over $100,000, this was 15 years ago…..When I called him to ask and inform him I had to submit the review and I was wondering how something like this could happen…he said he was a good appraiser and his assistant did the report and he didn’t review…..I replied, you live down there, you should already know what that area sells for. The lender was going t send him for license revocation to Harrisburg and wanted me to handle it for them, but before they could they went down with the housing crisis. Talk about getting lucky !!! Me and him……

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    • Avatar Thomas Baldwin says:

      Where are you getting the info regarding FNMA being in midst of retracting the ANSI standard? I still get emails daily from clients that April 1 is a go.

      I’m not doubting you, I would just like to know why it’s not surfacing.

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  59. Avatar PJTMC says:

    Hmmm, perhaps someone ar FNMA is monitoring the appraisal blogs?

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    • Avatar chris says:

      They probably realized the hell they were going have when the appraisers had to changed their GLA’s by measuring the right way . That would make the UAD system tracking go nuts….They came out with the c and q rating for just that reason, 1 report says average another says good and another says all renovated…that’s the only reason they came up with the rating…..

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  60. Chris, 40 x 30 with one floor is 1200 Sf. The same 40 x 30 with 2 floors is 2400 Sf even if the entire 2nd floor doesn’t cover the entire 1st floor. Read the two articles I posted one is straight from the Appraisal Insititute. In fact, if I went back into my books from when I worked at Fannie, I could literally show you sketches that we used in the handbook/selling guide to show appraisers that when measuring, you measure the exterior perimeter. In using this method, it does NOT exclude any open areas. So now all of a sudden, we are supposed to believe that has changed and it has been wrong all of these years. Don’t think so. HERE IT IS STRAIGHT FROM FANNIE SELLING GUIDE. “Gross Building Area
    The gross building area

    is the total finished area including any interior common areas, such as stairways and hallways of the improvements based on exterior measurements;”

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    • Avatar chris says:

      That is the craziest thing I have ever heard. you are confusing gross “Building area” with gross “living area”. Are you a commercial appraiser ??? There is no floor, you cant stand on it, its not GLA. And again, no wonder some appraisers are going insane when told how to properly measure a single family residence with ANSI. And one more time I will say, that is why they want all of you appraisers doing it wrong all these years to correct your ways…..we all want to have better data, counting areas with no flooring to stand on is not GLA. you can say it all you want, but you are wrong and have been taught wrong since the day you started appraising.

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    • Avatar Tammy Moos says:

      Been appraising for 25 years and to use a floor that you can not stand on is absolutely crazy. I have worked to an assessor’s office they never did this. I have worked in a large office and was not taught this way and currently work in my own office with 3 appraisers and none of us would ever use a floor that you can not stand on as GLA.

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  61. No, the craziest thing is you saying that everyone is wrong but you. You have now read it from AI, another acritical from an appraisal study, and Now I sent you the exact verbiage from the Fannie Mae selling guide.

    “What’s the definition of insanity, keep doing the same thing and expect a different result”

    In fact, I think you should deduct the open area out of your cost approach!!! LOL. It’s free to build and put a roof over it LOL 🙂

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  62. No, 23 years Residential

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    • Avatar chris says:

      I was taught by an office who was doing 300-700 appraisals a week. we had 50 appraisers, I have done reviews for 5 years….My7 office was going 30-50 appraisals a week in 3 states. I have never seen anyone count a 2 story family room as additional gross living area because its not gross living area, its open to below area, it is a design adjustment, not GLA, you are giving value as GLA without the ability of USING it as GLA. And once again I say to you…no wonder the appraisal gods want a standard of measuring for appraisers. So stick to your guns, let me know what the GSE do to you when the time comes. And I am not the only one telling you are wrong.”

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  63. Avatar CJK says:

    It appears that some appraisers do not know the difference between GBA and GLA, that explains why FNMA wants a standard. You never count the open-air space in the GLA. It appears some of the appraisers have been part of the problem. If you do not know what you are doing you better take a class on ANSI. If you have been doing it correctly ANSI is nothing new.

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    • Avatar chris says:

      Thank you !!! Some people just can not admit when they are wrong….

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      • Avatar Thomas Baldwin says:

        Chris, I’ve posted multiple example of why they are doing it wrong and the only thing they come back with is that they are right.

        ANSI – they are wrong
        AMS – they are wrong
        State of NC -they are wrong
        This very web site from a WA State appraiser blog essay- they are wrong
        Central VA appraisers and assessors – they are wrong

        Here is the instruction from AMS which was developed from a —consensus— of people in the real estate industry.

        1. “Open Foyers — Interior space which is open from the floor of one level to the ceiling of the next higher level, is included in the square footage -for the lower level only-. ” — they used italics for this

        2. All “GLA” located on any upper level must be floored, functional, finished space.

        You really can’t get much clearer than that.

        No appraiser that has been doing it opposite of published standards for their entire career is going to openly admit they are wrong.

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        • Avatar Chris says:

          You are absolutely correct, and I am just amazed that they have been doing it so wrong for this many years and we’re never called out by anyone.

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          • Avatar EB says:

            Good, I was beginning to think I’ve been doing it wrong for the past 33 yrs. How can you call open areas living area if you can’t live on it ?

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  64. Avatar Jesse L says:

    Given the letter sent from NAR valuation committee to FNMA on 02/07/2022, it will be interesting to hear FNMA’s response. Text below:

    February 7, 2022
    Hugh Frater
    CEO, Fannie Mae
    Midtown Center 1100 15th Street NW Washington, DC 20005

    Dear Mr. Frater:
    On behalf of the 1.5 million members of the National Association of REALTORS® (NAR)1, I write in response to Fannie Mae’s recent announcement that appraisers will be required to use ANSI® Z765-2021 (American National Standards Institute®) for measuring, calculating, and reporting above-grade and below-grade square footage for appraisals requiring interior and exterior inspections with an effective date of April 1, 2022. NAR requests that Fannie Mae delay implementation of this new requirement until Freddie Mac, FHA, VA and USDA adopt the same requirement to reduce confusion. Real Estate professionals and appraisers also need more time to become familiar with how the standard is applied.

    Different Rules by Secondary Market Participants Cause Confusion
    NAR urges Fannie Mae to coordinate with all secondary market participants to implement any changes to appraisal measurement requirements. The adoption of the ANSI standard by just Fannie Mae will result in confusion in the real estate market. For example, for conventional loans, appraisal management companies and lenders do not know which GSE a loan is being sold to before the appraisal is assigned. So, it would be impossible for an appraiser know if conformance with ANSI standards is required.

    More Time Needed for ANSI Education
    NAR is committed to sharing information with the real estate community about the new ANSI measurement requirement, but this will take time. Currently, there is no definitive source for square footage nationwide. Tax assessors, appraisers and real estate agents are not required to conform to any law or regulation for measuring square footage.

    Given this is such a significant change, the implementation date should be pushed back for the myriad professionals engaged in real estate transactions to learn and adjust to the measurement standard. There should also be a grace period during which real estate agents and appraisers provide feedback to the GSEs to work through any issues that could arise from the new measurement requirement. We have received numerous questions about impact on measurements for appraisals and any resulting changes to housing values, especially for older homes. Here are a few examples:

    • In areas where alternative standards are used that deduct the staircase from the upper-level living area, the difference in measurement could be in the range of 50 SF. Measuring to the nearest inch should be good in concept, but is not practical in many cases due to obstructions and other design elements making it difficult to locate the outside of the foundation wall. Having allowances for minor rounding seems prudent. Most homes are measured to the outside wall, but if precisely applied it is to be to the outside stud or outside foundation for a full brick veneer.

    • The areas that will cause the largest problem are those classified as “basements.” If any portion of the space is below grade it is to be classified as a basement (with some exceptions). In some areas, there are developments with homes that have low profile berms along a section of the house, which, in the strictest, sense makes the property a basement home. However, no market participants see it that way.

    • Home designs with sloping ceilings on second and higher floors are common in many parts of the country. This is true for new and existing homes, but particularly true for older housing stock. Often the slope is utilized as a closet, which may or may not have a conforming ceiling height. Sales activity has demonstrated market acceptance for decades. Adoption of a standard the market does not recognize will do nothing to produce more credible appraisal results. Additionally, many homeowners may feel cheated when their residence is now described as many square feet smaller than they bargained for, and much smaller than described in the appraisal when the house was purchased. Similarly, homes where the second-floor ceiling is not more than 7’ in height is not to be included in the room count and above-grade GLA totals according to ANSI standards. Many older homes have this issue, such as some Cape Cod style homes.

    • How will use of the ANSI standard impact review of comparable properties? What if properties in local MLS systems and assessor records are not ANSI-compliant? The appraiser may not know what method an MLS listing or assessor used to calculate the GLA.

    • ANSI measurement standards do not apply to condominiums. To date, Fannie Mae has not issued any guidance for condominiums, and yet on April 1, appraisers must conform to the standard. This is insufficient time to allow for appraisers to learn the requirements.

    • The 1004 Appraisal form is being retired as part of the UAD and Forms Redesign project. It would be beneficial to delay implementation of any measurement standard until the forms are redesigned and the new language can be included on the forms.

    It is understandable that adoption of common standards can often result in clearer and more efficient processes. However, there is a concern that eliminating the ability of highly trained and experienced professional appraisers from having the freedom to decide on appropriate methods and practices, poses its own risks and limitations. Currently, the GSEs and others rely heavily on a single approach to value when other approaches and indicators are available and that appraisers are trained to utilize. The result has been some criticism on value outcomes that lack thorough development in favor of quicker and less costly reporting. NAR supports any methodology that will result in the most accurate and reliable appraisal results that increases the confidence of the users of appraisals and thus, the housing market as a whole. In order for ANSI to be a reliable measurement standard, it is essential that this standard be adopted by all of secondary market participants (VA, FHA, USDA and Freddie Mac) to avoid confusion for real estate professionals, buyers, sellers and consumers.

    Leslie Rouda Smith
    President, National Association of REALTORS®
    CC: Sandra L. Thompson
    FHFA Acting Director

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  65. Avatar PJTMC says:

    Thank you Ms. Smith for your articulate letter to FNMA. Your observations are absolutely spot on from a user of appraisal services. Now, if the Appraisal Foundation will address potential violations of USPAP would be nice. Before I’m crucified for speaking my piece, my references are the overall issue of the changes. Sad day when some are not allowed to debate without being bullied.

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  66. Good morning Ms. Smith,
    Great letter to Fannie, one additional very significant point that should be included. What about builders, A builders cost include every square inch in building a home. Deducting open areas from the GLA by appraisers will start an uprise among builders who include the entire exterior parameters of the home when building as GLA. So, when an agent takes a listing from the builder, who states the home is XYZ in GLA, and then the agents use to list the home. Now, all of a sudden an appraiser using the new standard comes in ~400 square feet less, and then uses comps that are also smaller. Now we have world war iii.

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    • Avatar Thomas Baldwin says:

      I just pulled a random floor plan. The home just sold built new for $1.3M. It has a two story foyer. The second level notes “open to below”. It is not counted in the architects figures for that second level.

      Here are the data sources.

      MLS – 4,500 SF above grade
      Actual Plans – 5,218 SF above grade + 2003 Fin. Bas. ( 10,400 SF under roof, garage, porches, etc. )
      Assessor – 0 – no data

      I knew something was up simply by studying the comps. I called the builder and they sent me plans. So it really doesn’t matter on new construction if you verify your data. That’s pretty much standard procedure around here for new construction.

      Have another plan from different architect, $1M home. The open to below is removed. Property not in MLS, no assessment data.

      I can assure you no builders are leaving money on the table regardless of what figures are reported.

      Why would an appraiser knowingly use 400sf smaller comps if someone reported the open to below in GLA for a comp. The appraiser should be able to determine what’s going on. That’s why FNMA wants verification sources.

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  67. I’ll admit it, you guys are wrong!!! LOL LMAO

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  68. Avatar Raymond says:

    Hmm…. well the classes for ANSI and the Desktop reports are popping everywhere. Some benefits, for some, I guess.

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  69. What’s the GLA here?

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    • Baggins Baggins says:

      60×48, + 60×48, – 10×20.

      Did it all without paying a dollar or buying any special interest books.

      Thank you, thank you. (cheerful applause).

      Let’s try something harder.

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      • Avatar Seneca says:

        Nothing hard about split-levels. Nothing hard about measuring any house.

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        • Baggins Baggins says:

          My sentiments exactly. Adhering to local market standards is a no brainer.

          Reporting in a fictitious manner in a way contrary to the entire market surrounding.

          That’s where it becomes difficult.

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          • Avatar Seneca says:

            Nothing fictitious about reporting split-level sq ft for the subject or the comps. The lower below grade level gets counted in the basement section. Always was no matter the market.

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            • Baggins Baggins says:

              Seneca, this illustrates the confusion and lack of cohesive conversation on this matter.

              The same as what you said, but opposite is true in CO.

              We have always included garden in agla above grade spaces, that is our market.

              How would you feel if we stepped in and forced you under threat of penalty to do it our way instead?

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  70. Avatar David J Desjardins says:

    I have been appraising for 33 years and square footage has never been an issue. The most important factors when appraising is yes you are trying to get as close as you can to the square footage however knowing your market area and understanding the methodologies employed with different reports knowing how to complete paired sales analysis when markets are changing is far more important to arrive at a value than being a few square feet off one way or the other. Fannie Mae should be looking at the appraiser’s due diligence in completing a report as there are so many other factors more important than GLA (Who is so far off that the value is misleading, I have no idea). I am a Certified General Appraiser who has completed over 9,000 reports from single families, condos, land, acreage, commercial reports and in 33 years was not reported to the Appraisal Board of Appraisers for misleading GLA numbers. This appears to me that they’re is NO NEED for ANSI measurements being a part of appraisal methodologies and by instituting additional requirements which are not relevant to arrive at supportable values will create a shortage of Appraiser’s which is already the case in my state, MAINE. Please do not require us to make additional changes as our clients are supportive of what we provide them with and creating additional work will only end up increases costs and losing Appraiser’s. Is that what’s important at this point when inflation is at 40 year highs?
    Before instituting this ANSI requirement, look at all the issues this will create and it will not help lenders nor Fannie Mae receive any reports which will drastically change the market other than negatively change the profession.
    Thank you
    David J. Desjardins

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    • Avatar chris says:

      I am still baffled that some appraiser actually include 400 sqft of “living area” (or more) when there is in fact no “living area” on a 2 story family room or open foyers How much “additional” work is their really when an appraiser has to measure a 2 story family room or foyer and deduct it from the sketch??? What does inflation or a lack of appraisers have anything to do with measuring a house accurately??? The reason “they” are coming out with a standard is in fact because some appraisers are NOT reporting accurate GLA and instead are report Gross Building Area on the 1004. What do you guys do when there is a 2nd floor with that 400 sqft??? Do you add 400 sqft to the comp so you can make the adjustment for larger GLA ??? Again, I am baffled by this situation with so many appraisers acting like the world is coming to an end and all the hardship will occur is the ANSI is utilized.

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        • Avatar Chris says:

          Earl… What business is of yours? I am reading that appraisers are acting like the sky is falling in because they have to measure a property correctly and competently under standards. Are you also one of the appraisers who have doing it incorrectly for more than 30 years? Because if you are I would love to know your thinking process of using gross building area instead of gross living area. That was taught to us in appraisal 101.

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      • Chris, I’m baffled that you still won’t believe what you have read, unless you didn’t read what I posted days ago. I posted the original ANSI standard for measuring when it was developed by ALL the players Fannie, Freddie, HUD, VA 1996. All of them concluded that you measure the entire exterior of the 1st and 2nd or 3rd levels and that’s the GLA. I also posted an acritical from the Appraisal Institute above that says the same thing. So, is everyone else wrong and you’re right? SORRY YOU’RE WRONG!!

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        • Avatar chris says:

          Martin, this is right from Fannie – what in the world are you talking about ??? See item #4 (I marked them)

          Here are some items for appraisers to consider when using the ANSI standard1 :

          1. • 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.

          2. • Staircases are included in the GLA of the floor from which they descend.

          3. • Basement is any space that is partially or completely below grade.

          4. • 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.

          It clearly says (DOES NOT INCLUDE) Like I said, I am still baffled by the resistance and the crying over this.

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          • I have been trying to tell, The new standard is WRONG…. It’s never been done this way before, Excluding open areas. Again, if you ready all the Articia’s I’ve uploaded here you will see that.

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            • Avatar chris says:

              Ya OK…. Martin, Can you send me something that says we appraisers are NOW suppose to include “open to below area” as GLA and use Gross building area instead of Gross living area??? Because if that is the case then the appraisal GODS are saying open to below area is worth just as much as actual living area and that is just insane…I think you would agree.

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        • Avatar chris says:

          Here is the website link https://singlefamily.fanniemae.com/media/30266/display

          And just to put it there, here is what Fannie is also saying

          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.

          Is there an exception 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. For example, berm homes with their entire square footage below grade would be eligible for an exception. The appraiser must provide justification for an exception, lenders are responsible for confirming the appraiser provided an adequate explanation. Fannie Mae will monitor for inappropriate use of exceptions (i.e., using methods other than the ANSI standard for homes that have typical above grade
          square footage).

          We are to code our reports when we do not follow ANSI and they will be watching….

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          • Avatar David J Desjardins says:

            No, I am not an appraiser who includes open space area. I do measure this open space area and do not include it in the GLA. I also do not include areas for Capes which do not have adequate head room nor basement areas in above grade GLA as many Brokers do. It is only common sense NOT to include these areas as additional GLA.

            No, I have not been completing reports improperly in terms of GLA and for someone to ask that question, maybe you have. My sketch’s show the open areas which are not included in the GLA.

            I’ll compare my hand drawn sketch’s to your Ansi drawings any day. This is just a waste of time and should be a requirement for appraisers, maybe like you, who complete sketch’s improperly which should be picked up by the bank review appraisers but the problem is that many review appraiser’s are not qualified nor understand the process used in the sketch which is easy to do if you are a reliable and competent reviewer.

            My sketch’s have been hand drawn precisely and explain fully what the GLA is. I may be frustrated as I am one which has had no problem arriving at the correct GLA by hand drawing which in my opinion is more accurate and easily understood by individuals who read and understand sketch’s

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            • Perhaps you should read a little more and you would know how to do it correctly. READ ANSI 1996 Standard from the beginning.

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            • Avatar Chris says:

              Are talking to me ? Or just agreeing that open to below area are not Gla? Sounds to me like you’ve been doing it right. I’m not sure. We have always deducted open the blow areas, and capes would at least 5 ft of standing height, and include the areas underneath the stairs. I actually in fact do not agree to measuring to the inch, nobody is that perfect. But if they want us to measure to the inch, who are we to argue with the appraisal gods, who have rereading our forms, increased our workload tenfold, standardized to reports so to computers can read them and find fraud easier with the c ratings. As far as hand drawing your sketches, I mean come on really? Not sure what program you use but drawing your sketches is a little outdated don’t you think since we’ve been able to use computers for more than 20 years now. And the further expand on this crazy conversation we’ve been having for 2 weeks now, I think there is a movement in this country to oppose all changes whether they be medical political philosophical, liberal and appraisal. I just don’t get it?

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        • Avatar Thomas Baldwin says:

          Martin Cahn,

          Have you ever read the book Property Inspection – An Appraiser’s Guide , John A. Simpson, MAI

          Published by The Appraisal Institute

          Reviewed by several MAI, SRA, RM menbers. Prefaced by the then President of The AI.

          ISBN: 0-922154-36-8

          Page 48 – Calculation of Gross Living Area

          1. “Measure the length of all first floor walls.”

          —– This is where I think some get confused. The question arises, should one measure inside or out. As you have noted we are supposed to measure outside. The problem is that organizations such as FNMA, etc. are not teaching organizations and they are speaking in highly generalized terms when they say measure outside. Sort of like “how does one play guitar” FNMA’s answer might be to ‘ strum the strings’. True but there is quite a bit more to it than that. For that one should seek an education, often an ongoing education.

          Back to the book.

          2. “If the home has more than one level, determine the size of each above grade floor”

          — Notice the use of the word “floor”. ‘Determine size of floor.’ is what is being taught here.

          3 – 6 simply teach how to handle the basement, garage, porch, decks, etc..

          Now he goes on to create headings for “Difficulties in calculating Gross Living Area”. There are not a lot of difficulties in measuring GBA – Gross Building Area but in GLA he devotes specific instruction. He notes several issues one may encounter and provides instruction.

          One in particular is as follows…

          “Partial Floors. When the above ground floors are partial floors, the appraiser should determine the gross living area by measuring from the ground floor. This is done by measuring the length of the first floor walls that parallel those on the second floor.” — he then goes on about not using percentages, etc.. and ends with this…. “Many split level homes have partial second floors which approximate 50% of the ground floor level.”

          So it is clear as glass that The Appraisal Institute acknowledges that partial floors such as those with open areas to below need to be handled not simply by exterior measurements but typically and most easily by looking at the first floor walls and determining how they align to the upper level walls such that the area open can be removed.

          He also mentions in one paragraph that FNMA guidelines do not require interior measurements. However he goes on to say that often porches, varied walls from the outside can be seen to align with interior walls such that one can determine open spaces, etc.. He goes on to state that electronic devices are handy for interior measurements. all that in the same paragraph.

          All that disputes the exterior only GBA reporting. It acknowledges what FNMA states and then teaches how to make a credible and reasonably accurate GLA sketch and/or floor plan.

          Chris is not wrong. Nor are the rest of us that try to report a correct GLA.

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        • Avatar Thomas Baldwin says:

          Martin Cahn,
          Have you ever read the book Property Inspection – An Appraiser’s Guide , John A. Simpson, MAI
          Published by The Appraisal Institute
          Reviewed by several MAI, SRA, RM menbers. Prefaced by the then President of The AI.

          ISBN: 0-922154-36-8
          Page 48 – Calculation of Gross Living Area

          1. “Measure the length of all first floor walls.”
          —– This is where I think some get confused. The question arises, should one measure inside or out. As you have noted we are supposed to measure outside. The problem is that organizations such as FNMA, etc. are not teaching organizations and they are speaking in highly generalized terms when they say measure outside. Sort of like “how does one play guitar” FNMA’s answer might be to ‘ strum the strings’. True but there is quite a bit more to it than that. For that one should seek an education, often an ongoing education.

          Back to the book.

          2. “If the home has more than one level, determine the size of each above grade floor”
          — Notice the use of the word “floor”. ‘Determine size of floor.’ is what is being taught here.

          3 – 6 simply teach how to handle the basement, garage, porch, decks, etc..
          Now he goes on to create headings for “Difficulties in calculating Gross Living Area”. There are not a lot of difficulties in measuring GBA – Gross Building Area but in GLA he devotes specific instruction. He notes several issues one may encounter and provides instruction.

          One in particular is as follows…
          “Partial Floors. When the above ground floors are partial floors, the appraiser should determine the gross living area by measuring from the ground floor. This is done by measuring the length of the first floor walls that parallel those on the second floor.” — he then goes on about not using percentages, etc.. and ends with this…. “Many split level homes have partial second floors which approximate 50% of the ground floor level.”

          So it is clear as glass that The Appraisal Institute acknowledges that partial floors such as those with open areas to below need to be handled not simply by exterior measurements but typically and most easily by looking at the first floor walls and determining how they align to the upper level walls such that the area open can be removed.

          He also mentions in one paragraph that FNMA guidelines do not require interior measurements. However he goes on to say that often porches, varied walls from the outside can be seen to align with interior walls such that one can determine open spaces, etc.. He goes on to state that electronic devices are handy for interior measurements. all that in the same paragraph.
          All that disputes the exterior only GBA reporting. It acknowledges what FNMA states and then teaches how to make a credible and reasonably accurate GLA sketch and/or floor plan.

          Chris is not wrong. Nor are the rest of us that try to report a correct GLA.

          Appraisal Institute – Using Residential Appraisal Report Forms ISBN: 0-922154-85-6
          Mark R. Rattermann, MAI, SRA

          Page 59 “for most lenders, openings to the upper floors that expose the floor below cannot be included in the GLA for the second or third floors, with the exception of the staircases.
          Pretty clear there too. Don’t include open areas.

          But wait, there’s more…. Let’s see what the Employee relocation council has to say.

          The Relocation Appraisal Guide 2010 –
          Page 22 figure 6. A floor plan with a two story foyer is provided.

          “The contribution to Gross Living Area ( GLA ) of any open two-story area should be calculated on the basis of floor area only. Therefore, open floor areas must be deducted from the GLA calculation.

          They go on to restate the concept and do actual calculations such that there can be no doubt in anyone’s mind that the open areas -must- be removed.

          Soooo…… yeah, anyone not removing open areas from 2nd and 3rd stories has been doing it wrong.

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          • Avatar Chris says:

            Sorry Tom, you weren’t talking to me. Lol but thank you for your support and what I’ve been trying to say.

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            • Avatar Thomas Baldwin says:

              @ Chris… no I am on your side and it’s clear there are appraisers here that simply are not going to accept the years of education that has been available to them.

              I will say this though. I think FNMA is screwing up in choosing such a strict standard. The reason being is that some courses teach that if you deviate –at all — then you can not state you applied the ANSI standard.

              As David D notes above he can draw a sketch by hand, not specifically to ANSI and it will be “appraisal accurate” IOW, You, he, I, and several other people that have posted here could measure a very complicated dwelling with many open areas, basements, questionable land grades touching the building, etc… and we are all going to be very very close to each other. So close that there will be no value issue.

              However if you then toss in a true strict ANSI person and a GBA person, then you could start to get results all over the map.

              A system is good but ANSI maybe -too good- for practical appraising. I mean ANSI states that if a 60′ wall has 3″ below grade fro say 24″ then that whole area is now basement. That’s just impractical.

              It sounds like to me FNMA needs to first get a pamphlet named “How To Measure GLA” I think that would solve 95% of their “trust” issues.

              But yeah, I totally get what you are saying. So does this guy…..

              https://www.workingre.com/ansi-ill-tell-you-what-you-can-do-with-this-ansi-stuff/

              Also — sorry about double posts. When I try to edit, all formatting gets lost then the forum will double post for some reason.

              I’ll bet the insurance companies love this thread.

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              • Avatar chris says:

                No worries about double posts. I reply on my cell phone most of the time, In this little tiny window, corrections to voice typing are insane to do.

                Anyway, I am saddened by the uproar about using a standard of measuring, its long over due in my opinion. Hell, We have had the American Standards on almost everything for the past 100+ years. And now on appraiser measuring.

                I am not thrilled about measuring to the inch, the program wont allow that small of value. But Wintotal may update their programming, if they haven’t already. So I will do the best I can, We all know sometime the sketch doesn’t close, especially on a contemporary and other varying home designs for varying reasons. We all do the best we can and yes we all should be within a few sqft to each other unless the appraiser has some dyslexia….it happens to the best of us and even more to the rookies. Measuring a house in the rain or sub freezing temps blows, we make mistakes, but we are smart enough to catch those mistakes during the preparation of our reports.

                Frankly, I am amazed some appraisers have been including GLA that is not there….I find it ludicrous and very unprofessional and to even try to justify this practice “because that’s how the builder does it and the realtors count below grade and they call small height finished attic as GLA, I mean come on. I have seen so many inaccurate reports when an appraiser needs to make a deal he includes a small finished attic as a bedroom or an enclosed porch or part of the basement as GLA and additional bedrooms, then supplies unlike comps with no adjustments. Basically over appraising to make the deal and not lose a client. So I am glad appraisers will be all placed on the same page, so to speak. And will be held responsible for their negligence in reporting GLA. It is a stain on all of us. Just another scream by a user of an appraisal screaming appraisers don’t know what they are doing. Which I know is a fact because I still talk to reviewer from FHA and other reviewers I know. They tell me half the appraisers out there have no idea of what they are doing. It is sad. We had to move to C rating because of this. The fraud was insane with appraisers trying to get their clients A paper funding instead of renovation or construction loans.

                I ask what happens to these appraisers and I am told they get a smack on the wrist, I ask why, i am told the same answer all the time “because there are so few appraisers these days.” I just shake my head. Sad.

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                • Avatar Thomas Baldwin says:

                  Total Sketch
                  Tools — Preferences — Grid —- snap to Grid increments — drop list 0.1
                  ————————– Line Unit Measurements — Decimal Feet
                  ————————— Decimal Precision — drop list 1
                  ————————— Area Unit of Measure — Drop list Square Feet
                  ————————— Auto close area snapping — drop list 0.1

                  Re: All the other…. I don’t get it either. Well I do get one thing…. FNMA and the software companies have tried to turn appraising into an accounting procedure. Unfortunately the buying and selling residential real estate is anything but that.

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                  • Avatar chris says:

                    Yes Sir !!! I have changed those on occasion, when I had to, I have done many many strange properties over 30 years. I would guess that the GSE’s and others are tired of having 1 report saying a GLA and see other reports with a huge difference in GLA. Thank you for showing everyone how to change their settings….You are a good man !

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  71. Ok, so you two guys don’t want to listen to the original 1996 ANSI standard of HOW TO MEASURE A HOME, POSTED ABOVE. YOU also don’t want to listen to the acritical posted above from the AI. Here it is again direct from the Appraisal of Real Estate 12th Addition. “GLA” Total area of finished area above grade residential space; Calculated by measuring the outside perimeter of the structure and includes only finished, habitable above grade living space. Page 226 Table 10.1!!!!! I appraise multi-Million-dollar homes. Most have very expensive 20 Ft + ceilings made of the highest end materials, wood craftmanship & design and you don’t think that should be included. By your logic, you wouldn’t count half of the roofs, some made of tile, some made of metal, brass etc. You can’t walk on them, you say you don’t live on them, if you’re not measuring the entire exterior then you’re not accounting for all of these items. By your logic, the roof area over the open area is not given any value. UNTIL NOW, IT’S ALWAYS BEEN THAT APPRAISER MEASURE THE ENTIRE PERIMETER…. READ THE ORIGINAL ANSI STANDARD I HAVE POSTED ABOVE, THIS WAS AGREED ON BY ALL MAJOR PLAYERS BACK IN 1996.

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    • Avatar chris says:

      “and includes only finished, habitable above grade living space”…..I don’t know how many people can float in the air…LOL, once again, its not gross building area they are looking for, its Gross living area… No floor, No GLA…..not that hard to understand….Open to below area are design adjustments. you keep beating a dead horse. What is the hardest thing for man to admit, is that he is wrong.

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    • Avatar Thomas Baldwin says:

      It’s not “you two guys”. It’s a nation full of appraisers.

      “if you’re not measuring the entire exterior then you’re not accounting for all of these items.”

      You are confused by some means. We –do– measure the entire exterior. As Chris told you many posts above. The roof, the trim work, they details…. They are all quality and design issues. They should be compared to like items.

      The result in doing so…. you will have a subject and comparables that simply have a higher $/SqFt price. Nothing goes left out, or not accounted for.

      By the way…. the first book I noted above was published by the AI in 1997.

      “UNTIL NOW, IT’S ALWAYS BEEN THAT APPRAISER MEASURE THE ENTIRE PERIMETER…. ”

      Yes, that’s why we all do it.

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      • Avatar Chris says:

        Thomas you were 100% correct, and with a higher price square foot that would reflect the amenity of having a large two-story open family room, no matter what the finishing is on the interior walls and ceiling.

        I am starting to believe that some appraisers in some market areas are relying on price per square foot to render their opinions of value.

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    • Avatar Thomas Baldwin says:

      Martin,

      Check this link. Read the first and and third sections… Living Area … Open Spaces.

      Note the word “Floor”
      http://www.exton.biz/ansi_voluntary_standard_z7651996.htm — yet another part of teh nation that recognized decades ago what is excluded in GLA.

      Also Google, Bing, whatever the phrase Habitable Living Space and note that no matter what is included or excluded the terms Live, sleep, eat, cook, are the basis. Now in a two story foyer you can sit on the first floor and read a book or otherwise live there. Greet visitors, hang your coat on a stand, etc.. Now go directly up to the 2nd floor and you can’t do any of that. You can’t –live– in that air space.

      Gross “Living” Area.

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    • Avatar Thomas Baldwin says:

      Martin,

      You keep going back to ANSI 1996 as a standard. Then you have said that now in 2021 things have changed regarding GLA.

      I can’t find a 1996 version of ANSI but I do have 2003, 2013, and 2021. I will quote them below. Notice with regard to “FLOORS” there is no change.

      2003
      “Finished Area
      An enclosed area in a house that is suitable for year round use, embodying walls, floors, and ceilings that are similar to the rest of the house.”

      2013
      They did not include a definitions page but on page 15 Figure 6 they show a 2 story foyer and it clearly instructs you to exclude it.

      2021
      “2.3 Finished Area
      An enclosed area in a house that is suitable for year-round use based upon its geographic region, embodying walls, floors, and ceilings that are similar to the rest of the house.”

      Notice 2021 is nearly identical to 2003 and in 2013 it was graphically explained.

      I can only find a pdf of a course taught regarding the 1996 ANSI standard and in that course it was taught to remove those same areas.

      Regardless of what was done in 1996… I have shown you three published sources that teach not include those areas you include. I have linked to other appraisers, teachers, shop owners, and blog posts by appraisers across the nation. And now I have presented you with the actual quotes from ANSI.

      ANSI specifically notes — comma “floors” comma — Two story elevations do not have floors on the upper levels.

      No floor, no GLA. It’s really that simple. All your other concerns are quality, design, etc. Not GLA and ANSI has not changed that concept. the only thing they changed was some wording the staircase situation. Not on open spaces.

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      • You can’t find it because you don’t want to be proven wrong LOL. So here it is again. Pay close attention to the last paragraph, 2nd sentence ( The ANSI Standard for Measuring Houses

        In April, 1996 the American National Standards Institute (ANSI) adopted a standard for measuring
        single-family residential buildings. American National Standard Z765-1996 was developed through a
        process of consensus among a wide variety of participants.
        These included the American Institute of Architects, the Appraisal Foundation, the Building Owners
        and Managers Association, the Manufactured Housing Institute, the National Association of Realtors,
        Fannie Mae, Freddie Mac, HUD and others.

        The ANSI standards are not law, only a voluntary guide, and are subject to periodic review and
        revision. But anyone using these standards must apply them as a whole, and not just pick out the
        parts they like or agree with. The standards are intended for both attached and detached single
        family residences, but not for apartments or multi-family residences.

        The ANSI standards base floor area calculations on the exterior dimensions of the building at each
        floor level and include all interior walls and voids. For attached units, the outside dimension is
        the center line of the common walls. Internal room dimensions aren’t used in this system of
        measuring.

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        • Avatar Thomas Baldwin says:

          Can you link me to the PDF. You are not using quote marks so I don’t know which part is you speaking and what is actually published ANSI. Or as it looks, it may be someone’s over view of ANSI in layman’s terms.

          At any rate look at the 2003 version. That is 19 years. You have been appraising for 23 years. So you have been doing it wrong most of your career per ANSI. Not that have to use ANSI.

          Here, read this guys post from 2007. Look at his credentials.
          https://www.millersamuel.com/chip-shots-accurately-calculating-gross-living-area/

          He appraises NY and CT

          The Internet is just full of highly qualified appraisers that have posted pages regarding not measuring open areas on 2nd levels. It’s everywhere. All across the country.

          I’m not sure why you choose to ignore the changes and trends of time. Maybe you also simply rely on the first publication of USPAP and call it done. That’s your business though.

          What you posted above does not sound like an ANSI document but rather someone else giving a layman’s over view. I’ll keep trying to find an actual copy.

          Do you have any links to actual appraisal instruction that instructs appraisers to simply use GBA rather than GLA.

          I have posted several from AI, ERC, that instruct appraisers to remove open areas. It has nothing to do with me being wrong.

          Maybe I am mis-understanding you. Maybe you are saying that in 1996 you understood that all homes are supposed to measured by GBA. Then when ANSI changed as early as 2003 for certain to remove open areas that you thought this was wrong and still do so you did not and/or will not adopt that method. I have no problem with that. It’s your choice. It’s not what the vast majority of appraisers do but it’s your deal if that’s how you want it.

          I can’t find any credible source that publishes instructions so as to measure by above ground GBA = GLA and that’s basically what you are doing.

          Here is ANSI 2013 Just go to page 15 and look at the sketch and it’s note to remove the two story foyer.

          https://birminghamappraisalblog.com/wp-content/uploads/2017/09/ansi-measuring-standards-2013.pdf

          So are you saying that is wrong? That’s the actual ANSI doc. Is it right or wrong?

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          • OMG Look it up ANSI Z765-1996, But I guess if you don’t know how to measure a home, I can understand that you don’t know how to use the internet. One last thought for all you Brainiacs, Why do you think Fannie/Freddie List it on the appraisal forms as GLA Because it stands for GROSS LIVING AREA. Not GROSS NET LIVING AREA, NOT SUBTRACT OPEN FLOOR AREA, BUT GROSS LIVING AREA>>>>>GLA<-GLA-GLA-GLA!!!!

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            • Avatar Thomas Baldwin says:

              I’ll take that as a no. You won’t post a link to the actual document. As well you won’t acknowledge any current versions of ANSI nor answer a simple question after I post you link that would take you 60 seconds to peruse and form an opinion on.

              Your point of view has devolved to semantics which further diminishes any ground you had to stand on, however shaky it has always been.

              You have no facts, no support, only insults.

              Dude you are the one that brought up ANSI as your support. ANSI tells you to remove the open areas and has for most of if not all of your career.

              When I search for ANSI Z765 1996 I get links to the updated versions OR in one case a document that teaches how to understand the “ANSI Z765”

              That document is here….
              https://manualzz.com/doc/26732762/understanding-ansi-z765-standards-for-single-family

              On page 10 it clearly states…

              “The next example contains open floor area to the floor below. The stairs do not completely fill the stairwell. In this bird’s eye view, the stairwell is white . It is evident that the treads do not completely fill the well. The open area must be subtracted from the second level area computation.”

              I have attempted to post a snip from the ANSI Z765 – 2013. It is rather clear as to what one should do. You are right about one thing though. The GLA is a “net” of the GBA.

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  72. Avatar Chris says:

    To all of you appraisers who are so up in arms about using a standardized measuring system, I am reading these comments and laughing, if you don’t adhere to the standard, and you put that code in your appraisal, and the appraisal Gods see that that you’re not following the standard, you’re going to lose every client you have, because they’re going to simply ask you what is wrong with you ? Don’t you want to do our appraisal work anymore? And you’re going to sit there and tell people who could care less about you and the moral ground you’re standing on because you don’t want to upset realtors and builders.

    If any appraiser said that to me they would never get another job. So good luck to all you, stand up for your morals, cut your own throats, make yourself look stupid. Because that is what our industry thinks of us, and they have good reason.

    I can hear it now, what do you mean the appraiser didn’t use ANSi ? The appraiser says ANSI is stupid and it’s violating their freedoms of having a choice of how to report the actual gross living area. The other guy says… Is that really what the appraiser said? The other guy says yeah. And the other guy, who could care less about you says….Don’t ever call them again….

    Time to start measuring houses people. get over it, I think most of you have been stealing the assessor’s sketches for most of your career.

    And some of you cannot get it in your heads that you’ve been reporting gross building areas instead of gross living area. Which is appraisal 101.

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  73. Avatar Tom Bonne says:

    I will now use one of the three bottom lines in the 1004 grid to add back the GLA that Fannie is making us omit with their use of ANSI standards. I can play their game : > ) What they taketh away on one line, I’ll giveth back on another. Have to figure out what to call that line yet. Maybe just “Additional living area”, and then a comment in the addendum as to the rationale for having to do that.

    1
    • Avatar Raymond says:

      I guess that’s a way to address the issue, but why play their game? just curious.

      1
    • Avatar chris says:

      So what you are saying is you are going to add imaginary GLA and make adjustments, because you still want to use Gross Building Area, instead of making a design/appeal adjustment? Will you also do that to the comps that have open areas? LOL Wait till your lenders see that….LOL…..Get ready to lose your clients.

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  74. Avatar Doug Kues says:

    Seems like all the fuss from Fannie (including UAD & checking all reports) is focused on “consistency” (from one source to another; from one report to another; etc). That being the case, I would NEVER report two different sizes, but will seriously draft a full and total disclaimer from accuracy or consistency with public record; MLS information; assessor maps; GIS sources and so on….. unless or until they (each and every one of them) provide written and verifiable confirmation that each source used precise ANSI standards, within 1/10 of an inch, after being properly trained to do so. That should just about cover it.

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  75. Avatar Kenneth Smith says:

    There are a lot of comments and they are somewhat confusing. Is there a short on-line course that will help clear up some questions that I have? But not from the appraisal foundation.

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    • Avatar Tom Baldwin says:

      What questions do you have?

      1
      • Avatar Tom Baldwin says:

        Just got another set of plans. These are drawn by Builders FirstSource Area 5 – DC Market

        Clearly cut out the two story are that overlooks the 15 x 17 family room.

        Builders FirstSource is a full service supply and design operation. There DC Area is MD and VA

        The builder builds in VA, NC, SC, GA

        So that’s 5 States total that the designers, draftsman, review engineers, material suppliers, etc, all cut out open to below areas.

        I had a little trouble reading some of the figures but the plans VS me are as follows

        THEM ———– ME
        1461 ————- 1456 First Floor
        988 ———– 992 Second Floor
        390 ———– 393 Garage

        ====================
        The open to below was not subtle at ~ 255 Sq.Ft.

        I honestly can’t recall when I’ve seen plans that do not cut those areas out of Square Footage.

        1
        • Avatar don says:

          Spend a little time aligning the figures before pasting this into your report, as the basis for your (THE APPRAISERS) basis of opinion of value.

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          • Avatar Tom Baldwin says:

            ???? You lost me. I posted this to show those that claim other professionals such as builder’s plans don’t remove “open to below” areas to be incorrect. Builders, Draftsmen, etc., do remove those those areas.

            I still have to measure the actual dwelling.

            Regardless I’m pretty sure FNMA is not concerned about a 4 – 5 Sq. ft. difference per floor. FNMA is concerned about that 255 Sq. Ft. being reported in the same manner by all appraisers. Which is to not include it in the GLA.

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            • Avatar don says:

              The appraisers JOB is whatever he says it is in the engagement contract, His courtesy’s may be more, like explanations, sketches, drawings, or all and more of the above. Plus defending logical complaints

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  76. Avatar Katthleen Morell says:

    This is just ridiculous – up there with the category ratings… I think alot of us that have been in this business for far too many years may take this a just another sign to think of another way to make a living.

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  77. Baggins Baggins says:

    What a mess. I wrote a 5 page letter to FNMA today asking them to include far more exception allowances and to completely redo their FAQ. I also asked for whomever pushed this to be fired and audited.

    FNMA does not have the authority or know how to rewrite this wheel. They’ll need to enact this policy from a federal level and force every assessor in the country to adopt this first, otherwise it will never work.

    A CO appraisal group zoom meeting CE on ANSI. Don’t get your hopes up, no CE credits for you!
    https://www.youtube.com/watch?v=xgFfVUgNY18
    “We’ll just use the exception, turn it in, and see what happens, how lenders respond.” Yep, that’s my plan. Fannie will supposedly be monitoring the volume of exception use. If this was just as simple as complying it would not be this big of a deal. Bi and Tri levels are prolific in CO. They’ll need to recognize this standard simply will not work in rough terrain mountain and hill areas where partially below ground is common. Also; “Are realtors being trained on this method? The answer is no.” And no, I will not be soliciting ANSI measurement standards to measure for realtors because; “Fannie is the only one requiring ANSI standards, VA is not, FHA is not, local boards are not.” “If fannie gets only exceptions than I have a feeling it’s not going to work.” “FNMA thinks this change will drive adoption across the valuation industry.” We’ve heard of high hopes but dang, talk about over reach. Many appraisers are not in agreement and there was interesting commentary there is already calls for this proposal to be tabled.

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  78. Avatar Kevin S. says:

    Just made the time to thumb through a downloaded Ansi book a colleague decided to pay for. Figure 5 depicts a 2 story house fully above grade in front and rising terrain to about lets say 2 feet above floor level in the rear. Not blocking windows or anything absurd. Per guidelines as if 4/01 (yeah great day for this foolish release!) the entire 1st level is NOT GLA – but by the same standards any 1 foot area beneath a slab construction 2 story house’s staircase is GLA! Well done Fannie, just brilliant! PS. I cannot wait to make – lets go with $80K s/f adjustment for a minimally below grade bi-level versus an above grade comp then put it all back in a finished basement versus slab construction adjustment just so I can comment on the absurdity of these requirements.

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    • Baggins Baggins says:

      In the video link I posted above, appraisers were having a conversation about how could one have a basement larger than the agla area, as per many appraisers whom have already adopted ANSI, that all goes to the basement line. Apparently ignoring or brushing off the obvious cost basis differences when it comes to adjustment volume. Others stated we’ll need three different gla lines to account for this nonsense. Per the FNMA ANSI FAQ, the newly coined non basement basement area should have all of it’s room counts attributable to the qualifiable agla line, yet actual gla should be scooted to the basement line or a line item adjustment (Individual free entry line items for unique adjustments are something the new updated FNMA forms appear to omit, convenient). Imagine a 800 sq ft upper level with 7 rooms, and the 1,600 sq ft basement level with only 3 rooms.

      I suggest you write the FNMA people and voice your objections before this policy becomes solidified. The hard truth of the matter appears to be that ANSI representatives used insider connections they already had established at FNMA to push yet another proprietary special interest engagement through. The ANSI group had already carved out special lower lending rates and other terms through for companies whom coordinated with the ANSI groups for profit interests. ANSI is not just measurement focus, it is a consortium of special interest engagements through a broad range of construction, material supply, and lending engagement focus.

      https://singlefamily.fanniemae.com/appraiser-contact-us-form

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      • Avatar Doug Kues says:

        Well, as we get down to the wire on the ANSI standards mandatory requirements I am reminded that we appraisers are also responsible for accuracy of site size and the resulting adjustments to reconcile site size differences between subject and comparable.

        Well, I can also tell the industry and all the players that I have never personally measured a site for an appraisal report, and that I have never been able to verify within a 1/10th of a foot per dimension or 1 foot overall, and that without exception we have 3-4 sources reporting site size in my market area and I have never (that’s a “never”) seen all sources match. If the legal description shows all measurements (not common unless, say, 50×100) even then the assessor records; the GIS maps; the MLS rarely all match the site dimensions, and the site dimensions on our assessor maps matching even the secured tax rolls is generally the exception rather than the rule. So, if I cannot confirm and verify site size with accuracy, and I certainly am not going to accept liability for any such accuracy, it seems rather logical that the disclaimers I have used for 30 years on site size issues better work for improvement size discrepancies as well. We shall see, but I would submit that if licenses are going to be sanctioned or revoked over this ANSI standard then we ALL better be looking elsewhere for work and just let Zillow be relied upon as the best available information source. A primary rule in appraisal is consistency all right, but punishment for the lack thereof when existing sources that have been considered reliable for decades are substantially less than ideal citing violation of industry standards is probably not a viable solution.

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      • Avatar Doug Kues says:

        To me, a recently self identified novice having only appraised for 30 years, the inherent issue here is what we are retained to do in the first place.

        Since the inception, my job has been to take my market supported opinion of value and report it to my client in a manner that they can understand and that will lead them to the same conclusion that I reached, and they pay me a fee that is agreed upon in advance before I have ever seen the property, its quality, its condition, its features, or what size it might be. I have never been retained to make determinations of legality, permitted use, compliance with any and all codes, or specifically to accurately report how a water heater is installed and whether or not it complies with local standards or manufacturers guidelines for installation. (Note that simply saying that tankless in demand super Rinnai unit doesn’t have to be double strapped surely doesn’t cover “proper” installation). Similarly, that little round thing on the ceiling, that we cannot even tell if is smoke, CO, or a combination thereof, not matter what it is or whether or not it works has somehow become our responsibility and should we remain in the loop if the property burns down…. that thing better have been functional and properly installed if we are to stay out of the courtroom. This stuff is not appraiser related, exceeds most all appraiser expertise, and may actually reflect an impact on value of, say, under $100. Hardly critical to value or marketability, but all of a sudden, through uninvited Scope Creep, pulls yet another scapegoat into the loop of liability.

        Honestly, years ago I could probably tell you the likely selling price of a home in my market area within $1000, for free, in minutes. Those days are long gone, all my old sources have been deemed unreliable by the industry I represent, and the engineering degree that I do not have has evolved into a frightening reality. Can’t quit, because they have that hook in me for everything done in at least the last five years, and I need the revenue stream to prepare for the litigation that should never have happened. Misrepresentation is one thing; entrapment for reasons that have little or nothing to do with value or marketability is quite another.

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  79. Avatar John Daley says:

    Hello Fellow appraisers. I am very thankful this blog happened. I was one of the first commentors. The Blog said to be respectful in your comments and be respectful of others. I can say this much… I appreciate everyone’s comments, Good, Bad, or Indifferent. It doesn’t matter. That is what makes us better. I think we all agree that real estate is …(put your own words in here)…interesting. Appraisers, developers, builders, bankers, investors, clients, customers, homeowners, etc, are a part of it. The best thing is the relationships we build with all of us. That is why I’ve enjoyed doing appraisals. So other side. There is a NEW Desk Top Form, The NEW (old) ANSI requirements, and also the UPDATED 1004 Form. Really!! I am moving on to another opportunity. If a competent person would write these three things down on piece of paper and then read the requirements of each, I would have to believe at least ONE question would come up about the competency of all of them. Its been fun appraising, but moving on.

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  80. Avatar Doug Kues says:

    Well, yunno, like we all need to read and understand client guidelines with each and every assignment whether or not it might be full of non-industry standards. This entire blog should be mandatory reading (and understanding) for each and every FNMA, USPAP, FREDDIE, and AMC employee before this becomes mandatory. It’s certainly not the appraiser problem, but when mandatory….the way all the other players measure becomes our liability if we are to stand behind adjustments for square footage and room count differences. It isn’t just the measurements WE make, it’s the inherent “confirm and verify” that becomes null and void on April 1st. Interesting how many lower level GLAs just became basements and our ability to determine “comparable” sales with similar features just became extinct.

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  81. Avatar PJTMC says:

    I can tell you from first-hand knowledge, VA is not accepting this foolishness as they have seasoned appraiser (for the most part) at the helm, and they run a tight ship. As appraisers, their input has been invaluable to the decision makers in Washington. Hmmm, perhaps that is why they have never experienced the same failures as FNMA & FHA….bingo!

    Proud to say I just declined my first 1004 desk request.

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    • Baggins Baggins says:

      ANSI logic check meme.

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      • Avatar Tom B. says:

        That is actually not what Q16 says.

        What Q16 says is “above grade non-GLA” ANSI is very clear as to what is above and below grade.

        What that means is say a ranch 1,000 Sq.Ft. above grade with 8 rooms heated and cooled but the utility room is say 150SqFt. and has a raw concrete floor and no finished walls. That is 150 Sq. Ft. non-GLA.

        You report 8 rooms and 850 Sq. Ft. GLA.

        In your meme that guy is standing in the basement and gets reported on the basement line.

        Also from FNMA.. “While the ANSI standard is not definitive on this point,”

        [cough cough} Say what?!!! ANSI is very clear. They could care less about an appraisal. The standard is cut and dried. Clear as glass as to what’s above and below grade.

        I’m convinced now that FNMA has no clue what they have done and still can’t believe this is not an elaborate April Fools joke.

        I got this from an AMC today.. They indicate ANSI standard requires a statement in the appraisal report.

        Here is their suggestion for the appraiser measured subject.

        “Finished square footage calculations for this house were made based on measured dimensions only and may include unfinished areas, openings in floors not associated with stairs, or openings in floors exceeding the area of associated stairs.”

        That is pretty much as backwards as one could possible get while using the ANSI standard.

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        • Baggins Baggins says:

          Oh boy, appraisers will be unpacking this for some time to come. Personally I’m going to lean on what posters like yourself, whom apparently do understand ANSI, will handle it. Thanks. If the ANSI standard is to be mandated via the selling guide, the ANSI guidelines should be incorporated into the selling guide for all to utilize as necessary. Or is every single user of appraisal reports, reviewer, appraiser, assistant, underwriter, lender, portfolio holder, are they supposed to buy all these digi copies of the same little ebook? Talk about a marketing strategy to sell the same digi item a hundred thousand times without hardly any effort. Should I redo the meme or… Just slapped that together in ten seconds on imgflp.

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  82. Avatar E J Brown says:

    36 days until retirement. I don’t currently do any lender work, So I’m staying on through April for what ever comes my way. 04/30/2022 I’m done !

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  83. Avatar Doug Kues says:

    One of the earlier posts on this blog brought up the point that ANSI measurements, while intended to provide consistency with how we measure, was not designed or intended only for appraisal, or necessarily for appraisal at all. BUT, since the industry is making it mandatory, and since the water seems muddier than ever before and the liability greater than ever before, how are we to handle SITE size and adjustment for differences. My market has four sources for site size…..all once considered reliable sources (secured tax rolls, assessor parcel maps, GIS mapping source, and last but not least, MLS). Almost without exception, these four sources will give me three different answers for the same property. Thus, same would hold true for each and every comparable sale, and the differences are sometimes in 100s of feet or even acres. Keeping my thoughts together we have consistency, accuracy, reliability, and liability, to think about and comply with. How are we to report site size? Oh, yeah, just like we always have. I forgot.

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  84. Avatar Doug Kues says:

    Here’s an example of where ANSI measurement standard are probably best applied. We all want comfort in our decisions, especially when buying shoes.

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    • Baggins Baggins says:

      Doug, isn’t that something. Signs, shoes, and now in real estate pretending half of all the state licensed senior assessors in this country are doing it wrong. There is always someone whom in their arrogance and hubris thinks they’re smarter than people with decades of experience. Hey doctor, prescribe this instead. Yo plumber, wrong method. You, window cleaner, missed a spot. Listen here lawyer, that’s not the right course of action, I’ll represent myself instead. Hey assessors, your measurement methods and size reporting for 200 million housing units in the United States of America are incorrect and now must be reported OUR WAY INSTEAD! But this falsification of data presentation rule only applies to appraisers working with fannie, every single other market participant down to the dog and cat can still recognize a garden level as above grade area.

      https://www.mysafetysign.com/ansi-safety-signs

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  85. Avatar Tamer Degirmen says:

    I read a bunch of your blogs… Folks this is a job… If you feel like you need to do more work to achieve this result and it is going to take you longer to measure a house and do the calculations; ask for more money for your services… Its a perfect opportunity to raise your fees…

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    • Baggins Baggins says:

      Close, no cigar. The context from most posters here is that of 1099 independent contractors with independent insurance, a high probability of libel accusation and liability which extends beyond insured coverage to personal monies, civil penalties, and in some cases criminal penalties.

      Now with ansi, so when an appraiser purposefully confuses readers of the report and perhaps there is a dispute about value, we’ll be both racist and incompetent.

      Choice to operate in the most competent manner possible, to be flexible as situations may arise, is essential in the independent appraisal position. For those of us whom routinely appraise homes which ansi measurement standards will lead to a false portrayal of homes actual sizing, these illogical mandates paint a target on our backs. No amount of disclosure disclaimer language can write away the fact that the appraiser will go against the grain and materially misreport housing size in an apparently fictitious manner, contrary to everyone else involved; realtor, assessor, online data aggregators, mls systems, buyers, sellers, and builders, and every single other real property market participator except the appraiser. If only it was as simple as complying with a companies policies and directives, from a secured liability free position of employment. We would not be having this conversation in the first place.

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      • Avatar don says:

        Liability is reality. Insurance is limited the awards are not. Your personal net worth could be in jeopardy as well your freedom. Your reports should protect you!

        right on.

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        • Baggins Baggins says:

          Don that is a great comment. One that gives me chills having tracked responsibly for several decades now. The most illuminating set of continuing education classes I ever took went over several cycles where I selected every liability and claims class at several ce outlets.

          Per my posts below, our reports should protect us.

          The pertinent question is protect us from whom?

          The local people whom we deal with? The GSE and portfolio holders? Both?

          So although imposition of an ANSI mandate is much ado about nothing for what appears to be the majority of appraisers in this country, what about entire groups like all of the appraisers in CO where it appears the entirety (or close to it) of all our realty agents, assessors, all recognize garden level as above grade qualifiable area?

          What’s it going to take for FNMA to include bi’s and tri’s as qualifiable exemption to ANSI process? Do we need to frame a class action lawsuit against Fannie for discriminating against appraisers in our state whom will bear a higher degree of liability over this?

          As I said previously, this uniform standard can be manageable, if everyone else adopts it first. Appraisers are not leaders of their local real estate markets, we follow up other peoples efforts with comprehensible value opinions. As none of these other people recognize garden level as basement, appraisers in Cololorado may be quite literally the only people operating with a different reporting basis. I don’t know the courts system very well here and it would be interesting to hear from other CO appraisers whom do know that. It bears to reason that courts here recognize the local standards as the common guidance and peer standard. Or whatever the court jargon would be for competent operational methods in accordance with local customs.

          Like a light switch, we’ve discovered the source of this confusion. Different market standards in different market locations. We’re not dealing with some mis mash loosely gathered standard here in this state. Garden level is always reported in the above grade line. It’s not every other unit or infrequent, but rather across the board with very few exceptions.

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    • Avatar Seneca says:

      Ignore Baggins, You are correct. I just took a 4hr CE class on ANSI with Hamp Thomas. The only thing that was defined different than what most appraisers are already doing is the half story measurement (7ft/5ft thing). You have to add an addendum that you are using ANSI standard. Hamp said you don’t have to apply ANSI to Drive-bys, Comps or Desktops. And he is in constant contact with Fannie Mae. There might be 2-3 appraisals a year that you have to do some explanations.(Berm house, Waterfront or some other oddball house). ANSI only applies to single family homes and not Condos or Multi-family. There is no increased liability because of ANSI.

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      • Baggins Baggins says:

        O.k. Seneca. Obviously you are in a different state with different housing designs than me. This is the rub on this matter, these mandates will be easy for appraisers in entire states to deal with, while creating headaches for all the appraisers in other states. Like I’ve only ran across a handful of appraisers whom utilize ANSI in CO, the majority of us do not use it. I do not know of a single assessor from CO Springs to FT Collins or from Summit county to Eastern plains whom uses ANSI. Most builders don’t use it around here either.

        How would you handle a bi level? Keep in mind the assessors reporting, MLS listing, all market participants, always always always have the lower garden level as attributable agla, and stairs are not counted twice because it’s a mid level landing area, choice to go up or down, usually a 10×10 if not larger stairs space. How about a tri level where there is no solid information except by personally measuring a home, on the multitudes of different tri level designs where the garden level can be the largest to smallest area of the home? There are a handful of 1.5 stories with ceiling height variants in old town metro but otherwise builders in Colorado turned to bi’s and tri’s prolifically in order to provide more space and more structurally sound building with lower building costs and better energy efficiency just everywhere there are sandy soils, bentonite, exposure to swiftly changing temperatures on a daily basis, and constantly changing water tables. How about a high altitude home built on extreme slope like a 45 degree grade where they built into the mountain on half the home? It’s going to be like rolling the dice, completely different reporting methods based on the specific home type. ANSI is manageable for ranches, 2’s, condo, etc. If you are so lucky for those to be the predominant home types in your region. Even then, you’ll always be overstating your size by counting stairs twice. Counting stairs w/ ansi when the assessor does not and none of your comps will have that extra sizing is a cheap trick to pump up the appraised value $5k or more.

        Fannie used to want ‘to the local market standard’ and for the appraiser to ‘properly qualify data’. What is the point of falsifying size for mandated measurement method compliance, only to have to adjust that back on an individual line item because you know with a very high certainty, none of your comps had their stairs attributed twice. Stairs serve a utilitarian function, they’re only good for stairs. You can put 10 couches in a hundred square feet above, and 10 more couches on a hundred square feet below. You can’t put a single couch on the stairs, because it’s not usable space. Many builders don’t use ansi because it’s disingenuous marketing of their products. I tend to see ansi style space accounting in high density housing, townhomes, where there is so little space to begin with, builders count it twice to pump up the illusion of competing space, even though in the real world that usable space is not present. Now luxury homes with grand stair cases magically have an extra 200 sq ft?

        Good choice on Hamp’s class. He’s got a lot of books on Amazon and I’m planning on taking that class too. I’d rather take something more meaningful since I already know how to deliver a competent sketch ‘to the local market standards’, for ‘credible assignment results’, and ‘adequate qualification of comparable size data’, etc, etc. Throw all those assessors sketches and size records in the trash can I suppose. Have any good advice for conversational responses when every single sales agent, buyer, and seller, becomes confused when the appraiser magically turns half of a bi levels market recognized agla space into a basement but due to sales scarcity has to comp it against 2’s and a tri level, and a bi level? Should I guess on how much to cut the tri down for it’s variable sized garden level? Should I reduce the bi level comp to ansi standard too even though MLS reports it as all gla as agla? How to adjust that bi competently against a 2, when the market recognizes both homes as having equivalent space which drive equivalent price and cost? Asking for a friend.

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        • Avatar Seneca says:

          If you don’t know how to measure a Bi-level, tri-level or how to count stairs then you haven’t read ANSI.

          Why would you throw the county sketch in the trash? It’s is most of the time the only source for sq ft. It’s where you get your basement sq ft for comps.

          For a Bi-level comp.
          MLS list sq ft as 1340sf.
          County shows the foot print as 32×28 bi-level = 896sf for the above grade level.
          Extract out the 896sf from 1340sf = 444 sq ft of finished area in the basement.
          I never counted the lower level in a bi or split level in the GLA. More times than not it would have unfinished area that would go uncounted.

          What is so hard about ANSI. Measure outside dimensions, only include above grade, do the 7ft/5ft thing. YOU NEVER COUNT ANY STAIRS TWICE. As I said, there might be 2-3 houses a year you’ll have to explain.

          It is irrelevant who is or isn’t using ANSI, ANSI only applies to the subject that you inspected.

          When the lawyer ask you how did you come up with sq ft you don’t have to explain your personal opinion of doing it. Now you just hand them the ANSI handbook.

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          • Avatar Tom B says:

            You do count stairs twice. They count for the floor they descend from AND the floor below. Look at the Figure 1 and Figure 2 in the ANSI document. The red dashed line is the finished Sq. Ft.. Notice the stairs are included on floor 1 and 2.

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            • Avatar Chris says:

              When you all measure a basic 2 story square/rectangle on top of a square/rectangle that has NO two story areas, do you actually remove the stairs on the second floor and leave an opening?

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            • Avatar Seneca says:

              That’s because there is a second set of stairs going to the basement, which is counted on the first floor. You bring the stairs up to the level from which they descend.

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              • Avatar Tom Baldwin says:

                That’s only for stairs going to a basement. They get counted on first floor.

                The rest that serve above grade get counted from the floor from which they descend AND the floor below. As Chris just said there is floor under those stairs on the first level.

                So technically it should be stated…. you count the Sq Ft occupied by the stairs from the descend and the Sq.Ft they cover on the floor below.

                The bottom line. If you have 100sf of stairs from first to second floor. That’s 200sf towards GLA.

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  86. Avatar Chris says:

    How can so many get so confused about ANSI? ITs VERY basic!!! I worked for 3 appraisers prior to going off on my own going back to 1995. ALL ued ANSI. I actually thought every appraiser did. Its VERY simple. JUST TAKE OUT 2 STORY AREAS!!!! SIMPLE!!!!!!!!

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  87. Avatar Chris says:

    I dont get the confusion with stairs. When you all measure a basic 2 story square/rectangle on top of a square/rectangle that has NO two story areas, do you actually remove the stairs on the second floor and leave an opening? I would expect the answer to be no so, why would you all suddenly want to do that now? THis is all very simple and VERY basic

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    • Baggins Baggins says:

      Actually often yes. Because that’s the method which may have been used by the assessor, and the builder. We often need to use the negative subtract area feature within sketches to account for the excess when drawing the two story, bi or tri level home. Otherwise we’re reporting a home in a way larger than the assessor recognizes the subject, and all the comps. You run into this when you just know you have a matching model comp, your subject is 50-100 sq ft larger, and your sketch reads larger than assessed records by that much too. You know that for an apples to apples comparison, the upper level stairs need removed. If fortunate enough to get an assessors sketch, may reflect this method too. See, the rub again, for appraisers where this activity is not common, they may have a hard time getting their minds around this being a market standard in other locations.

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      • Avatar Tom Baldwin says:

        “You run into this when you just know you have a matching model comp, your subject is 50-100 sq ft larger, and your sketch reads larger than assessed records by that much too. You know that for an apples to apples comparison, the upper level stairs need removed.”

        Now you will just use the opposite thinking. Same value result. Your sketch will be accurate per ANSI. So if you know the comps are missing that area, rather than subtract from your accurate sketch you account for adding the missing area to the comps.

        A simple comment. Assessor nor Realtor included the stairwell fully thus the GLA calculates out 100sf smaller than my subject when in fact they are the same size. Thus no adjustment applied.

        You are just going to have write a catch all addenda. When it comes into play simply reference your addenda example.

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      • Avatar Chris says:

        That is 1000% wrong! How would a person get to the second floor? You would be sketching as if the builder never put stairs in the house. Have you been calling out functional problems too then? Lets say the stairs are there but they are on a chain so you can lift them out of the way if you want, would you still remove them? Have you ever been in a new construction house where it is just framed? If you have you would have seen there is a full floor below the stairs. It only gets covered up when the finishing drywall is added. They actually have to BUILD the stairs onto the first floor therefore it technically is part of the second floor sitting ON the 1st floor. You ACTUALLY take the stairs out of the second floor on a house with NO 2 story area? How have these appraisals been accepted by an underwriter or bank? Show an example of an assessor that takes out stairs. Have you been basing how you measure on how the assessor does? WHY! Who cares if they show something different, simply explain the difference and move on. Whats next we all disagree on 2+2=4? its really that simple

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        • Baggins Baggins says:

          No. The point of the sketch is to determine ‘if the assessment record is generally accurate’. I’m not contracted as an architect to deliver some perfect sketch under some specific condition. Or at least I never used to be until this silly ansi mandate came forward. If the builder and assessor used ansi I would have no problem using it too. When they do not use this method, but the appraiser does, that’s when ‘we got problems’.
          I’m there for market valuation services. By identifying if the assessor included stairs or not, I’m able to often come very close or match the assessors reported size records. That’s more professional than showing up like a know it all and saying the assessor and the agents whom relied on the assessment records for their list and purchase offers were wrong.
          And oh boy, there is going to be major problems when a buyers agent gets an appraisal back recognizing half of a bi level as not having attributable agla. They’re going to punch the sales price in a calculator divided by the newly half sized agla amount the appraiser has in his report, they’ll read a ppsf figure twice the size of what was indicated on the listing. Fingers will point. Tempers will flare. Heads will roll. Calamity will ensue.
          The stairs is such a minor issue, sometimes it needs cut out, sometimes it does not. If I have a choice I do not materially misrepresent a houses size or claim to be of a higher authority than the assessor, which the assessment departments are also staffed with dozens of appraisers, and have had access to building plans, and have also coordinated with the building planning department and the initial construction company to come about their ‘assessors stated size figures’. I don’t have those resources, I’m just the 1099 appraiser showing up for ‘market valuation analysis’.
          I have a longer post coming up too which illustrates much more challenging situations ANSI will bring then this silly to count the stairs or not to count the stairs argument, with a few situational examples (similar to my objection letter to fannie). Don’t get distracted by the minutia. But just technically, pretend there are no handrails. If you step over that stair cavity what’s going to keep you from falling? How is that usable space and any different than an open cavity you otherwise would not count? And how does one use the ground level area where the stairs begin? Are you going to lay down on your belly and snake around, pretending that’s usable space? Unless that’s your thing but most times that area is partitioned off by drywall, or there is something like a litterbox there.
          The argument goes either direction depending on your point of view. That’s why many valid measurement methods do not include the stairs cavity area, within the livable space count. It would not make sense to remove that count from the ground level, as there is no cavity there, so we count it ground level but omit it for higher levels. The tit for tat will never end on the stairs argument, best to discover and recognize ‘the local standard applied.’
          Flexibility is key to competent accurate reporting which is not misleading. Remember the goal always is ‘credible assignment results’. You’re there to be an expert on market valuation analysis and comparable selection, actual reliable apples to apples specific example grid valuation analysis and discovering or providing reliable estimates on market value reactions, cost approach factors, etc, etc. larger issues than the question of counting stairs. If they want an architect, they’ll have to hire one and those people charge a lot more than an appraiser does, with their own specialty license to boot. The interview above with the fannie guy claims that by pretending we’re architects and can hold to this one industry standard, this relieves us of some liability concerns. Hang tough for my next post, almost done. I’ll demonstrate quite the opposite. Thank you.

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          • Avatar Tom Baldwin says:

            “No. The point of the sketch is to determine ‘if the assessment record is generally accurate’. I’m not contracted as an architect to deliver some perfect sketch under some specific condition.”

            That is totally wrong thinking. Suppose your assessor gets hacked. All records destroyed. That’s how you should be approaching it.

            You are the pro. The assessor and agents are dealing with mass data from varied sources that are ‘close enough’ to do a mass valuation.

            I have never seen an MLS that didn’t say, you the consumer of the data need to verify it.

            You are the one person that is absolutely get it as right as you can and do i the same way each time. Will you make a mistake at some point…. probably, but it will easy to figure out, correct, and move on.

            No one is looking for perfection they want a consistent method so that if you come to my market or I go to yours, we will measure a house the same way. Sure we might be a few feet different but we will not be 300sf different.

            If the data in your market sucks so badly that you can’t gather from a few sources and determine where the similarities and differences are then yeah, maybe your specific situation is so complicated that ANSI is out of the picture.

            However, as I have mentioned several times…. if you know what the specific differences are, which you seem to, then you simply or in a potentially complicated manner, relate them to your subject.

            If you have no idea what the differences are… let’s say a home on 50 acres. Hidden from sight, 50 years old with a brand new addition. The assessor says 4000sq ft with an unknown amount in basement. MLS just states 7000sf and one photo.

            Well you can’t even use that as a comp. But a 2000sf Split Foyer in most any MLS or Zillow or whatever.. You can figure out from your visual, the MLS, the assessor, Google Earth, etc….. you can pretty well figure whats’ going on. If you can’t just tell your not sure what’s up and will not adjust for it. Let the value fall where it may.

            You are fighting an impossible battle.

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            • Avatar Chris says:

              I have been writing appraisal reports for 30 years, and my market area, you have to measure the house, we’ve been using ANSI for 30 years, I came from an office with 25 assistance and 25 appraisers, they were handling 500 to 700 appraisals a week, the two owners had more headaches and you could possibly imagine, when a GLA that you measured doesn’t match the assessor’s GLA you make a statement, and then you use disclaimers in your addendum that you relied on the comparables as what the assessor said, you do the best you can and just explain it, after you appraisers are like little cry babies, I don’t get it, and I I appraise complex properties every day of my life and I do not get it that you guys are crying that you’re worried about assessors, realtors and loan officers and Zillow and all these other people when we are the professionals. I don’t want to sound cliche but suck it up. Buttercup.

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          • Avatar Chris says:

            You absolutely do not remove the stairs from the second floor. Apparently you have never seen a house being built. The first floor area is complete with sub floor before they can BUILD the stairs. It just so happens that the stairs they BUILD ON TOP OF THE FIRST FLOOR fit right into the opening the stairs are built up to in order for people to get to the second floor so technically that is a floor but it just on an angle. I now see why banks and Fannie dont trust appraisers.
            Nobody is expecting the appraiser to be an architect, just show EXACTLY what is there. If a wall is 10′ 5 & 3/4″ long, the appraiser should have that wall as 10 5 & 3/4 long. A 10 year old can do that! How many milliseconds does rounding save? Basically all ANSI is saying is Take out 2 story areas form the 2nd floor. It really is that simple.

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            • Baggins Baggins says:

              ANSI and stairs is not even half the problem. It’s when ANSI says I have to cut out half the qualifiable market recognized size of something like a subject bi level. Then I’ll comp that against another bi level. Applying ansi to my subject but not the other. I’ll start out the gate needing substantial adjusts, crawling net gross, rising review alerts, underwriting questions, and none of the other market participants will have a clue as they have not bought the ansi book, will not use the ansi method themselves. There will not be any additional verification sources. It’s going to be a problem, guaranteed.
              I get your guys position on the stairs. It’s not rocket science. Yes, I’ve seen many many homes being built and know all about construction. And no, we’re not dealing w/ hypotheticals as if there is no assessment record when in fact there is an assessment record. Is it or is it not a skill to reverse engineer what method the assessor used and building department credited. Is it or is it not preferable to have the most similar accurate comparability possible. Is it or is it not better to have fewer adjustments rather than more when you’re basically dealing with model matches.
              You know, there is two sides of this coin so stop playing so tough about the question of to count stairs or not or who is the expert and who is not. Stay flexible, bend like the reed in the wind. What are you guys in love with government mandates or something? You’re all about it. What’s wrong with leaving the choice to the individual based on local market standards?

              edit thank you

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              • Avatar Tom Baldwin says:

                ” It’s when ANSI says I have to cut out half the qualifiable market recognized size of something like a subject bi level. Then I’ll comp that against another bi level. Applying ansi to my subject but not the other.”

                You are waaaaaay over thinking this. I’ve been doing what you just described for 38 years and have NEVER had a call back on GLA reporting.
                Look… you have SF that 1000 up 1000 down.

                You have 3 comps
                Assessor SF = 2000
                Realtor SF = 2000 but 1000 is in basement
                Realtor SF = 1000 plus a finished basement

                You report everything as 1000 up and 1000 in basement AND tell everyone why you did it.

                Why would you care what the agent thinks?

                IF in the scenario above all 4 of those homes were built on dead flat lots totally above grade but the agents and / or assessor said they had basements… too bad…

                You report it as 2000 up 0 down.

                If the picture I attach shows up. Our assessor reports that building as having a basement. On the back side is a garage. It’s all flat as a pancake.
                I have never reported that as a basement and don’t know anyone else that has either. You could drive you car up the apron and through the walls, you would come out the front door and down the steps.

                You are supposed to be telling it like it is. Otherwise they don’t really need you. They could get assessment data and listen to “Realtor speak” and come to their own conclusion.

                Otherwise you are just giving yet another “singular unknown method” of doing things.

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            • Baggins Baggins says:

              This is understood. Perhaps argue with the 10,000 realtors, hundreds upon hundreds of assessors and assistants, building planning office persons, permitting, architects, floor plan designers, etc.
              These are situational examples to illustrate such a uniform standard is not broadly implemented across the industry as a whole. Clearly this is cart before the horse to presume the small body of poorly represented appraisers whom struggle to just stay in business are the right people to force implementation of sweeping industry changes at large, by way of government mandates by force and threat of duress. Real classy fnma, real classy.
              Take of it what you will. All of the conversations and points relayed regarding are appreciated. Thank you.
              FNMA is going to need to ‘outsource the measurement service’ to actual architects, not tech companies forming software coding from what they read on the internet, whom then sub out to any tom rob or harry sub sub sub contractor with a certain cell phone and app software.
              In fact, that’s interesting, how does the architectural and drafting industries handle this? Does ANSI influence those working groups? Will have to check on that later. And where is the competition? Isn’t it a monopoly when one company controls the whole show? Either we support diversity and free market economies where peoples voluntary adherence to ‘best and most effective methods’, or we do not. Nothing good comes from the forcing others, or else in the long term. Government mandates, had enough of those for sure. Instant fail on principal alone.

              (may be too long of a sequence, my post did not place under the intended post. This post meant to answer the post from Chris.)
              https://appraisersblogs.com/ansi-measuring-standard-required-by-fannie-mae-in-2022/#comment-33808

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          • Avatar don says:

            The point of the sketch is to illustrate the efficiency of the floor plan and to point out YOUR interpretations for a basis of comparison. The problems with the in-acracy’s of the computer-generated sizes is that that only ONE side of the house is measured ” The appraiser did not square up his drawing. Did you see the crooked patterned linoleum flooring the Kit & Fam room?”, the converted Garage- bedroom or the elaborate outdoor summer kitchen.

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            • Baggins Baggins says:

              “The point of the sketch is to illustrate the efficiency of the floor plan and to point out YOUR interpretations for a basis of comparison.”

              Well, with certain housing. Functional adjustments are impossible to prove except for unique circumstances, like the only bath is in a bed area or in another ancillary building, etc.

              Space is space. It’s quite often adaptable. It’s either there or it’s not. The floorplan is understood by photos and the sketch does not need to be all that detailed.

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        • Avatar Chris says:

          Chris, give it up buddy, I think the problem is that these appraisers are in the Midwest and the southern states and they have been spoiled their entire careers relying on assessor data and assessor sketches to the point they have don’t have to measure the houses. I say this cuz I did reviews for 5 years, there are a bunch of wussies, I won’t get into politics, but they are a bunch of wussies, cry babies.

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          • Baggins Baggins says:

            Well, you’ve definitely installed a sense of professional confidence in me at least. Please, continue on with your invaluable insight. What does it take to be a pro like you Chris?

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            • Avatar Tom Baldwin says:

              Baggins, check these links.

              This is for a Colorado split foyer. First thing I hit on…

              assessor record…
              https://www.countyoffice.org/property-records-search/?q=106+Hoedown+Circle%2C+Fountain%2C+CO%2C+USA#structure

              online listing
              https://www.zillow.com/homedetails/106-Hoedown-Cir-Fountain-CO-80817/13553600_zpid/?

              The listing has a sketch included.

              Level 1 = 0 Sq Ft — excluded 847 Sf
              Level 2 = 1079 sf ft — excluded 471 Sf
              Total GLA = 1079 sf — total scanned = 2397sf

              Ok, so total scanned 2397- ( 1079+847) = 471 garage and I assume that unfin. laundry room in photos as assessor has garage at 22 x 20 = 440

              Now let’s look at the assessor numbers

              1st floor = 1026
              lower level = 901
              total = 1927 —- notice the listing at 1079 + 847 = 1926
              Garage = 440

              The numbers are simply not that much different. Also you can see an unfinished room in the photos. It looks like both assessor and floor plan are counting stairs.

              The listing reports 1079sf GLA above grade which is exactly what ANSI tells you to do.

              I’ve never been to Colorado, never looked for a property in Colorado and never been to Colorado assessor site. and I found that in 5 minutes. I could certainly compare that to my subject with ease.

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  88. Avatar E J says:

    Who cares, buyers don’t. Do they negotiate down the sale price because 2nd floor has a little bit of 6′ ceilings or do you get a tax break ?
    Shoulda built my house with 6′ 10″ ceilings, then I wouldn’t even own a house !

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  89. Avatar Chris says:

    From what I am seeing here, and all other posts everywhere about this, is that there really has to be a standard method of measurement by appraisers. anyone getting an appraisal should expect to see the same gla on any other appraisal after (within a few sf) the original report. If I was not an appraiser and the initial report said my house is 2000 sf, then refinance later and see 1800 or 2300 and completely different sketches I would think the appraisers are all just making things up.

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    • Baggins Baggins says:

      Especially when the reporting is materially different than what their buyers agent, the sellers agent, and the assessor posts as the ‘size of the home… Think twice because people put more faith and have longer term continued contacts with these people than the appraiser, whom they only see once.

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  90. Baggins Baggins says:

    Tom, I get that. Thank you. That’s a great example you posted, yes photo shows up. Obviously, you need to get away from assessors reporting. What about the opposite direction when assessor is recognized by market and can be considered reliable and accurate, but Fannie now dictates you can no longer recognize or report to the local market standard. How about this consideration? Remember, basement adjusts for actual basements usually have a lower adjustment basis, being less valuable in the market than qualifying agla space. Think bi level when you have to comp against a ranch, just one example. You know, I’m all about reduced liability exposure. Sounds like you have experience with the hypothetical I’ll describe below. I welcome your insight and advice on the matter. This response originally written for scenica.

    “It is irrelevant who is or isn’t using ANSI, ANSI only applies to the subject that you inspected.” Me; Yes, I understand that point clearly. How’s that going to play out in the adjustment grid and review process both human and automated review when for example, my subject is an 1,800 sq ft bi level… And due to needing recent sales in our red hot market, and having only 3 recent and local sales to select from, let’s just for a perfect example say I have 3 perfect size match comps. An 1800 sq ft bi level. An 1800 sq ft tri level. And an 1800 sq ft 2 story on slab no basement. Those are my only comps, I have to use them, there is nothing else. They all sold $400k, which is something that actually happens here in the midwest.

    Do you use the EO Reviewer Tool in Alamode or the equivalent of that in other programs? You know, the internal review tool which uses sophisticated data mapping to help an appraiser identify inconsistent or anomalous reporting. I’m pretty good at keeping my internal alerts to 12 instances or less on 1004,s and like 30 on condo form. Almost all of my alerts are for; The check box is marked y/n, but a comment is present. Silly nothing pointless alerts which underwriters dismiss. I always write something in there to reiterate I’ve checked the box I intended to check, it’s too easy to check the wrong box so I accept review alerts for ‘written content appearing’ even though the actual selling guide says you only need to comment if you’ve checked the other box. It’s silly. As condo has more questions, I get higher review alerts on that form. But if I were to hold to ANSI for subject but not comps, my alerts are going to fly upward substantially, I would not be surprised if this tacked on 20-30 or more serious auto review alert instances. Allow me to demonstrate.

    Scenario 1. I report the subject honestly ‘to the local market standard’. Oh that’s easy. No sq ft adjust required. My subject and my comps, all at 1,800 agla sq ft. No type adjust required. Only minor adjusts for quality factors, location, specific age, outbuildings, yada yada. My net gross is nice and low. Now this is a very important point, pay attention here; As net gross is an indicator of similarity or dissimilarity, the net gross is reading accurately with a nice low number. I know, and reviewers know, and the CU automated analytic systems know; this appraiser has picked some great comps! High degree of similarity. That’s why net/gross is low, I hit the mark and made competent comps selections. That’s how it’s supposed to work.

    Scenario 2. I manipulate my size of subject reporting to something contrary to widely accepted market standards by all other market participants, altering to ANSI size measurement compliance, in a manner none of the other market participants recognize, and they’re likely not to understand either. I cut half the lower level (because it’s a bi level partially below grade) cut that off! Now it’s reading like a ranch w/ a basement but in fact is still a bi level which competes laterally with any one of my 3 selected comparables.

    And now I’ve got to make a choice, estimate an ANSI reporting method for my comps, or to not estimate an ANSI reporting method for my comps. Per advisement above; ANSI only applies to my subject. We’ll roll with that but even if we were to estimate ANSI for comps, similar problems would emerge. So now with ANSI only applied to my subject, I’ve got an 800 agla subject w/ an 800 gla basement, running across the appraisal grid adjustment lines against all other 1,800 agla sq ft units w/ no basements. My subject now has a basement, curious, it does not read that way on any other data source. I have now failed to ‘validate my ”qualified data” with secondary sources’, a glaring and glowing point of liability exposure. But I’ll excuse that with disclose disclaim ANSI language, after all, Fannie demanded it, no exceptions, it was not my choice or my doing.

    That’s manageable in it’s own simple way in this perfect scenario but gets mighty complicated if any of my comps actually have a real basement or like if I had a tri level subject w/ a partial basement. Because then how to apply the same adjustment basis for all ‘market recognized agla areas’, and also apply the lower adjustment basis for actual basements which typically track with half the adjust amount of legitimate agla areas, also with lower room count adjust amounts.

    In this perfect scenario where neither my subject nor comps has a basement, I can just use the same adjustment basis for agla as basement, since none have a basement. (I’ve just earned a new CU alert; appraisers bas adjust outside the peer model) Let’s say $50 psf applied adjust. So now 800 agla x $50 psf adjust = $40,000 adjustment which runs across the board. To every single comp, since they’re all 1,800 agla sq ft. (just earned more alerts, crawling net/gross) Let’s just say it’s a $400,000 sale and all comps sold at $400,000 too. That’s a 25% net and a 25% gross adjustment indicator, before I even get to actual quality or item difference adjustments. (another alert for excess sized adjustments in relation to price)

    Right off the bat using ANSI on a bi level subject vs a bi level comp which I have not applied ANSI too, even though they’re perfect model matches, my net gross now reads with stark dissimilarity. Oh bummer, this just went from a CU risk score of 1, up to something like a 2 or even 3 or 4. The underwriter is going to have to use the manual exception process. Here comes the clarification stips. So much for efficiency. Things were going smoothly here, until the appraiser showed up.

    Now my own tools that I rely on don’t work. Because how am I to know that I may be missing the mark or over or under adjusting? I review the changes in net gross through the entire adjustment process. It’s how an appraiser can put their finger on the pulse and know if they’re doing it right or wrong. It’s how you can identify mismatching benchmarks to value in volatile markets. It’s how you know you may have done a great job and really honed in on accurate market reactions. The net gross line is everything, I suggest you always have your internal software set to show those percentage numbers in your prints as that is a software option. All market participants recognize this as an 1800 sq ft house, and it’s comped against model matches, so why is net gross 25%+… They’ll be scratching their heads. You failed to bracket your subject’s agla sizing (another review alert.) And your subject is half the size of your comparables (another review alert). It’s going to happen.

    Next we can detail another scenario like a tri w/ basement comped against matching model tri w/ bas, w/o bas, a bi level, and a 2 w/ partial basement, and let’s toss a ranch w/ fin bas in there. Or how about a ranch w/ unfin bas vs a bi level. They’ll read the same on the grid even though the bi level has twice the livable space and tracks a much higher price and value. It’s going to get a lot more complicated with even more review alerts and we’ll have to place the bi levels non basement non agla area into it’s own line item. We’ll be manually punching in calculations on a calculator like I don’t even have supportive software. Or maybe I’ll wing it and guess at tri levels lower level and apply ANSI to subject and all comps, but then how to manage the 2 story w/ bas vs ranch comps if that’s all I have… It’s a mind bender.

    At a minimum, Fannie should negotiate with ANSI and make the guidance book free of charge or incorporate that into the selling guide. And epifany; I may have just identified with FNMA’s CU modeling may have issues. They’re trying to interpret two entirely different basis of measurements. ANSI appraisers provide one number, appraisers whom hold to local reporting standards apply another. They’d have been better off with a more meaningful CU data input to prohibit ANSI from being applied ‘when the market does not recognize ANSI standards’, rather than mandated it. I don’t need ANSI to defend my work. The streamlined adjusted value indicators and weighted consideration of best matching comps with lower net/gross provide all the defense I need. Toss in the screen grab of very low internal review alert scores (which the CU system certainly also reads similarly), I’m golden. Or you know, paint a target on my back and act like a know it all, report contrary to everyone else.

    Unlike some of the other appraisers here, whom may earn themselves reputations as being difficult to deal with, I prefer a team spirited approach and it’s taken me pretty far with a good local reputation. I end up turning down realty work as I enjoy the steady rythm of mortgage lending assignments. I pick up the phone and land a new client if I need one. One can be a non advocate while still being on the same page as everyone else and engaging in a team spirited approach. What, now I have to educate everyone else on ANSI when literally nobody except a rare appraiser uses it. Silly, counter productive. In the midwest bi’s and tri’s always have their partially below grade areas (garden levels), as finished areas. Builders furnished them that way and people never remove the finish. Due to sandy soils, extreme climate, bentonite swelling clays, variable sloping, and energy efficiency reasons, there is a constant mix of varied design tri levels, bi levels, ranches w/ or w/o basements, 2’s w/ or w/o basements. In high country we have a-typicals like 2’s built into the side of mountains and A frames with like 140′ downward slope to deflect crushing snow loads. The look like gnome homes out of a childrens book. We have what is probably a million to two million single family housing units of the variety bi or tri level types in CO. There is not a burm home in site, and 1.5’s are ultra rare only in metro, there is not a cape cod within 300 miles if not more. My suggestion that FNMA update the ANSI FAQ to include bi levels and tri levels as valid reasons to use the GXX001 exception code stands, and for good reason.

    I’ve been at this 20 years too, it is appreciated when people focus on the issue rather than throwing weight around, barking dictates and demands at everyone. We’ve had enough government mandates to last a lifetime and trusting experts is not all it’s cracked up to be. Local customs matter more than what some bureaucrat on the hill thinks. The act of forcing a mandate also violates philosophical and cultural traditional expectations for fair independent dealings and due process. Government today; bolster ‘appraiser independence’ with blanket mandates and deny opt outs under threat of force. I will remind the FNMA people; “Good ideas do not require force.” Until they can get a uniform standard pushed through on the federal level where all assessors adopt it first, more harm than good and simply not going to work everywhere, even though ANSI may indeed work well some places. Thank you.

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    • Avatar Tom Baldwin says:

      In your scenario where you have bi-Level, a tri-Level, a bi-level , a two story on slab. All 1800sf. the market says hey we honestly don’t care. Different strokes for different folks.

      Subject = 900 up / 900 down
      Tri-Level = 1200 up / 600 down
      Bi-level = 900 up / 900 down
      2Sty = 1800 up / 0 down

      So since you know the market does not care where the finished living area is the $ adj is the same up or down.

      In your case the Bi-Level is at $400K and maybe an adjustment for a deck or porch. But comps 1 and 3 up and down adjustments should put them at $400K as well.

      I wouldn’t worry about what kind of errors are going to be generated. Just put a disclaimer that high adjustments are due to ANSI reporting and lack of similar comps due to market conditions.

      You really don’t have a choice starting tomorrow what you do with the subject. That being said and even with very few comps at least try to align them to the subject in some manner that also reflects the market. Like let’s say your tri-level above is really above grade. So put it all above. You still have that one bi-Level that matches your subject and everyone can see the other styles are bringing the same $$ for same overall Sq. Ft. of living space.

      It’s FNMAs problem what adjustments look like if you follow their rules. I had a really nice ranch a few years ago. It was built to have the lower level as a major aspect but it turned the first floor to a 2BR home which for comps was unheard of in that neighborhood. But it was walkout basement. So the agent called me up said I had done it wrong and that she had been selling real estate for 40 years.

      I took my subject’s rear photo and put it in photoshop. Drew a line at the grade for the first level. Wrote the word basement under the line, sent it to her and told her maybe she should consider retirement. Never heard another word.

      Yes, I use the EO tool. That will again be FNMAs problem starting tomorrow. %s, bracketing GLA, etc.. My comment will be that issues in these categories are brought about by the ANSI system and specific available comparable data. BUT… I have pretty good data here. I know what has been measured, where it’s located, etc.. So I’ve been dealing with that forever. I really have to have a tough situation and if that happens, hey, you get a lot of those errors. Hopefully I was smart enough to charge more up front so the pages of trying to explain the comparisons is worth it.

      “Or how about a ranch w/ unfin bas vs a bi level. They’ll read the same on the grid even though the bi level has twice the livable space and tracks a much higher price and value.”

      A ranch with unfinished basement will not read the same on grid as a Bi-Level with finished up and down. If I’m reading you correctly. the Bi_Level will show finished rooms in basement. The ranch will not.

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      • Baggins Baggins says:

        Thank you Tom. I’ve got an acceptable handle on it, while continue to be in disbelief fnma would do something this counter productive to efficiency, consistency in their modeling base, and go against the past 20 years of detailed technical development to map out automated review to provide meaningful user and reviewer alerts for cross correlated data points within the official form.

        We’re going to need a 3rd gla line to use for adjustments which works within our software in the updated forms for the ‘formerly agla, non basement, non qualifiable agla’ lines, aka the newly coined basement non basement. When I adjust an agla area for 50, my basement is likely 10/12 or flexible but never the same as agla, same for room adjusts, basement rooms adjust lower. Net gross is going to fly, manual review is going to be more complicated, reviewers will have a nightmare of a time figuring out variable adjustments applied unless the appraiser notes every last detail for every last applied adjustment on an individual comp to comp basis. I’ll probably work the form and sketch normally, scan those as image attachments, then put those after the ansi compliant sketch and grid. Especially in a super historical hot market like CO w/ 20+ offers for each of the decreasing amount of listings, agents are in a huff. I read the CO realtor group update today, one agent was talking about +$250k over list on his luxury class listing. Other routine units are moving +$50k routinely. Agents are struggling so are market participants. Materially misrepresenting a homes size to something absolutely not recognized as the market standard to anyone except appraisers is just plain short sighted and counter productive to credible assignment results. Courts have ruled the intended user and client definition does not necessarily limit the duty of the appraiser to provide meaningful reliable data to any and all users or readers of the appraisal report down the line. Limitations on FNMA approved liability protection language, appraisers can’t write their way out of liability or scrutiny with disclaimers any more than an agent can write their deal out of compliance with GSE standards just because the buyer and seller might happen to agree.

        Someone might want to inform Apex about the subtracting stairs thing. Attached.

        Imagine running bloodwork results this way or accounting… Well, it probably happens in accounting on the government level. Ha!

        Was really happy to see the NAR letter which asked for this to be slow walked and put on hold until other entities could have time to adopt this too. Going to write my local assessors and point them to this thread. And how will that work for assessors, whom have a fixed taxation method based on market accepted size factors? Call your home this, tax it as that. This is not how intelligent design is supposed to operate.

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  91. Avatar Seneca says:

    Quiz , When you do your ANSI addendum for tomorrow remember ANSI doesn’t use GLA it uses the phrase “_____________________”.

    Aws. Finished Square Footage.

    Quiz. Have you bought and read the copy of ANSI?

    Aws. You have until tomorrow to get one.

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    • Baggins Baggins says:

      But wait, there’s more! Nope, not yet, have a few old ones around somewhere.

      This is cosmic cobra on steroids.

      The financial incentive to sell more books will undoubtedly mean a continual stream of ANSI sketch standardized measurement changes. With the digi book, this could happen even more frequently than uspap. It’s a cash grab and someone is going to get paid handsomely at the appraisers expense. What’s new. Thanks for the info and conversation.

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    • Avatar Tom B says:

      “Finished Square Footage”

      Just a heads up… that is the exact phrase AMCs are searching for in the “ADDITIONAL COMMENTS” section of the FNMA URAR form. So save yourself a headache and be sure those three words appear there.

      Finished square footage calculated per ANSI Z765-2021.

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  92. Avatar Doug Kues says:

    I think we all agree, and profess these days, we are not contractors, pest control inspections, roofing specialists, or anything beyond a professional appraiser forming an opinion of value based on the best information we have at our disposal during the regular course of business. We have been forcibly morphed into a little bit of all of those professions, and are generally liable for what we say, and that’s precisely why the Scope of Work has grown exponentially over the years. So, I’m OK with ANSI. What I am not OK with is the degree of accuracy required. Take a 3000 square foot home and mandate that an appraiser be accurate within 1/10th of a foot (or maybe 1/12th of a foot) per wall and within 1 square foot accuracy overall, and I say that’s about the equivalent of mandating that the pest control expert report the actual number of termites accurately and mandating that the electrician report exactly how much the voltage fluctuates under load and how warm the wiring gets during winter months, or require a licensed roofer to be liable for EXACTLY how long that roof will last without leaking. It’s basically insane, has little or nothing to do with value or marketability, exceeds virtually all appraiser expertise, and is less likely than getting the same tax answer each time we call the IRS with a question. It’s the degree of accuracy required, and the liability therefor, that makes this entire requirement (not the process, the “accuracy requirement”) an obvious ploy to force appraisers into retirement or to modify report disclaimers to the extent that no one will be able to reasonably rely on any report; E&O insurance to add yet another exclusion; and preclude just about everyone from being able to follow the appraisal report and wind up understanding how the appraiser reached a final opinion of value. My money is on the variable results being six different improvement sizes from six different appraisers, with a seventh variation by the professional measurement specialist expert witness at trial.

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    • Avatar PJTMC says:

      I totally agree with your assessment. In particular, the retirement aspect. I have been a believer from the very beginning that it is not about ANCI or 7′ ceilings heights; it is about eliminating the appraiser all together. Everyone is caught up in the particulars when the issue here is very simple, elimination of the appraiser. They have tried for years with no success, so they have reinvented how to approach this using our own “tools of the trade” (so to speak) to drive us out. There is a conspiracy taking place in that they are hoping to get appraisers to leave voluntarily and those that don’t will find themselves in front of disciplinary agencies, thrown off the FNMA approved list or worse, in court. It is as clear as the nose on my face, they are creating an intolerable, toxic work environment and, as I said, appraiser elimination is the end game. Look it, everyone knows all appraisers are all talk and no action. This is especially true of the ones plying the politicians with PAC money. That is our history, there is no unity, and why we get walked on. If the appraisers could only take all the energy and effort spent on complaining and pontificating and channel it to organizing together, we might actually be able to fight this. But, alas, I have no faith in that happening. There certainly needs to be a federal investigation to find out who the players are and expose what is really going on. I have come to the conclusion that complaining does nothing more than it has always done, nothing. The facts some appraisers are complaining and pontificating about their greatness tells me they have already lied down and are going to take it. It doesn’t have to be that way if we are ALL willing to make it our mission to expose what is happening. I am certainly not a conspiracy theorist however if it walks like a duck, quacks like a duck it’s a dick. One gentleman sent in a great observation to this or one of the other blogs about the money trail that is, if accurate, factual. Good place to start.

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      • Avatar Chris says:

        It’s called American standards, and American standards been around for more than 100 years, they want all of us on the same playing field, so when one appraiser measures a house, the other appraiser should measure it similarly and then their computer models will work better and when more appraisers start doing desktops, the people that go inside of these properties to measure for us will be measuring using the same standard.

        I came from an office with 25 appraisers and 25 assistants. We were all using ANSI 30 years ago. It’s not that big of a deal.

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        • Avatar don says:

          Imagin! a new government agency developing standards wherein the old assessors, the old FNMA, the old Ginny Mae, the old assessor’s offices all across the USA were to arrive an acceptable standard. WHO would pay for it, (US)? And what would be acceptable To: architect’s Builders, banks, taxing agencies, etc.?
          Measure it, explain it, remark on the others and make your value based on your measurements. Just like always.

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  93. Baggins Baggins says:

    Tom, you’ve been really helpful, thank you for the time.

    Look closer at your zillow link though, click the facts and features, then click more facts and features / Finished area above ground: 1,927. That’s the market dude, that can comp against a 2 story or tri of equivalent size. The adjustment grid would be a mess to scoot a portion to bas. Let’s try another where I have mls access. You picked one far South where MLS does not share.

    https://www.zillow.com/homedetails/5134-Zinnia-Ct-Arvada-CO-80002/13731791_zpid/

    Hot dog that’s nice. / facts and features / Finished area above ground: 1,869 / Check that against the assessor, review the MLS listing.

    https://propertysearch.jeffco.us/propertyrecordssearch/address/property/details/pe4OJTp_B2SyPwLed_hYhzvgodQRleTuu4CHShQfB8A1
    That’s nice, the assessor provides upper and garden level. This looks new for this assessor, there is a ‘GL finish’ line, which shows 906 sq ft. Must be trying to be ansi compliant in their own way or something, garden level finish.
    Let’s check MLS; confirmed, agent entry: Above Grade Finished Area:1,869

    And that brings up an important point for the metrics realty agents use, that puppy has an across the board psf indicator:
    PSF Total: $334
    PSF Finished: $334PSF
    Above Grade: $334
    Change what above grade means, throw a wrench in that realtors plans. What kind of realtor is this, whom does not respect ANSI standards and pretends that basement is above grade area? Obviously he’s doing it wrong. No opt outs! Didn’t he read the FNMA ANSI guidance? He better hope for a VA or all cash purchaser or he could get straight toasted and roasted by the appraiser. I’m going to show him if I get that order, let him know how it’s supposed to be done. What do they think they can comp against a 2 story or something, half that home is not qualified ‘Finished Square Footage’. Ignore what you’re seeing, all that finished area, the ANSI definition is the only thing that matters. ANSI & FNMA make the rules for the market not these upstart agents.

    Let’s check something in Arapahoe.
    https://www.zillow.com/homedetails/19442-E-Brunswick-Dr-Aurora-CO-80013/13088086_zpid/
    facts and features / Total interior livable area: 1,240 sqft Finished area above ground: 1,240
    Oh no! Zillow is doing it wrong too!
    Going to need to fill out their listing error little pop up thing and get this data corrected. Obviously zillow does not know what they’re doing and should consult with ANSI immediately, like yesterday.

    check the county / All right we’re back in Arapahoe, they offer silly sketches at least.
    https://parcelsearch.arapahoegov.com/PPINum.aspx?PPINum=1975-34-1-51-002
    Wait for the page to load then click the little tiny sketch link
    That’s easy to read sketching, love it, not fnma compliant but at least it’s there.
    Assessor must be trying to be ansi compliant or something, but may be confusing some terms here. They do however provide garden level break down so that’s helpful. Have total building area as 856 sq ft. suppose that means the footprint of the home. What gives with three different 1st floor entries? Whatever, no time for that. / Let’s check the MLS / Oh good lord here we go again! Are my eyes deceiving me!? There is no below grade square foot figure in the blow grade line! And do you know how helpful it is for me to know with certainty that below grade line is reserved only for real legitimate basements. This is going to screw up my reliable market research methods adopted over two decades if agents start getting ansi compliant and putting garden levels in there and/or splitting up above grade entries into two portions. I’m not going to be able to make any sense of the data or will have to form some new custom research.
    On to the full MLS listing. OMG, another agent doing it wrong.
    Building Area Total (SqFt Total):1,240
    Living Area (SqFt Finished):1,240
    Above Grade Finished Area:1,240
    PSF Total:$363
    PSF Finished:$363
    PSF Above Grade:$363
    These agents with their uniform approaches and comprehensive finished price metrics. We’re going to show them how to do it right, because we’re appraisers using ANSI. These people simply do not know how to adopt uniform standards, they must be told and shown under threat of duress and force of the government if that’s what it takes. They’re going to get on board or we’ll stop them from working with FNMA. Their idea of uniform standards is simply antiquated and no longer relevant, because we said so and that’s the end of that argument.

    Let’s try something in Adams, whom I know does not offer sketches online. My heart is racing, I found another one right away.
    https://www.zillow.com/homedetails/11130-Dahlia-Dr-Thornton-CO-80233/13003583_zpid/
    facts and features / Total structure area: 1,889 Total interior livable area: 1,889 sqft Finished area above ground: 1,889
    I’m going to have to spend a lot of time demanding zillow correct their data. Another incompetent listing NOT COMPLYING with ANSI uniform standards. I’ll have to step in with the big guns on this one. / On to the county record.
    https://gisapp.adcogov.org/quicksearch/doreport.aspx?pid=0172107102001
    Built As: Bi Level
    Year Built: 1977
    Building Type: Residential
    Construction Type: Frame Siding
    Built As SQ Ft: 1885
    Number of Rooms: 7
    Number of Baths: 2.00
    Number of Bedrooms: 4
    Attached Garage SQ Ft: 500
    Detached Garage Square Ft:
    Basement SQ Ft:
    Finished Basement SQ Ft:
    Oh this incompetent set of like a hundred assessors here in Adams county we have. All that talent filling all those desk chairs and not a darn one of them knows how to run ANSI compliant measurements. Note the empty entry for basement lines. Obviously they are doing it plainly wrong. How do these people even have jobs in real estate valuation?
    Let’s check out the MLS on this one too.
    Oh SOB, it’s happening again.
    Building Area Total (SqFt Total):1,889
    Living Area (SqFt Finished):1,889
    Above Grade Finished Area:1,889
    PSF Total:$263
    PSF Finished:$263
    PSF Above Grade:$263
    These agents just don’t understand how it’s supposed to be done. Why haven’t they even bothered to pay $25 for the 15 page ANSI digital ebook already? Aren’t they like in the real estate trades? But really give the realty agent a break, they’re just using auto import tools which links the county and MLS together. Truly we should blame the Adams county assessor for providing this faulty data. I’m going to show them how to measure a home properly and report it accurately under a standardized measurement program. Ignore the fact the data is comprehensive and well qualified in it’s current form. Although what they are doing is already standardized, across the entire state of CO, they’re still doing it wrong. Don’t they understand that because those lower levels are half way below earth that does not meet the definition of qualifiable finished space. I’m going to forward these people the FNMA ANSI FAQ doc and set them straight.

    Local market standards matter and that’s just the way it is. Those builders ANSI has in their back pocket can adapt if they come here, it is not our responsibility to adapt to them. That’s called states rights and federalism. We have our own due process round these parts. Because it’s not just bi’s it’s tri’s too. And 2 stories and ranches w/ and w/o basements intermingled. Trying to scoot half the bi level to the basement line makes the appraiser look incompetent when literally everyone else recognizes this is not basement area. And then it’ creates further complications if I have units with actual basements. Adding a third line for market recognized AGLA, aka ‘finished square footage’ per ANSI guidelines is silly.

    This wordsmithing is confusing. Let’s check the definition of ‘finished’.
    https://www.dictionary.com/browse/finished
    condemned, doomed, or in the process of extinction:

    Oh wait, that’s the adjective. But it describes me pretty well under the ANSI standard trying to provide appraisals on this type of home stock. Here this is better description sought after.
    https://www.merriam-webster.com/dictionary/finished
    “provided with a finish: having a final treatment or coating on the surface”
    We need to sick ANSI on Merriam-Webster. Obviously we’re having a problem with standardization of the English language itself. You can’t call something ‘finished’ just because there is a final treatment such as flooring, walls, framing, beds, baths, stoves, trim, doors, lights, stairs, windows, curtains, electric, water, adornment, locks, a finished ceiling. We need to qualify finished as only being applicable if it’s above the earth. If it’s below the earth line obviously it’s not qualified ‘finished’. Ignore everything you know and see in these houses and re learn how to do this properly. There is a line, it is at your feet, it’s called the earth. And if any part of the home is below that line, YOU CAN NOT CALL IT ABOVE GRADE ANYMORE!

    Maybe this is me, I’m not perfect. Perhaps I do not understand the meaning of ‘above grade’. Let’s check on that.

    OH CAN OF WORMS! I’ve got conflicting definitions here! Whom is right?
    https://www.lawinsider.com/dictionary/above-grade
    Above grade means any portion of a building not below grade. (By-law 2013-138, S.11)
    VERSUS:
    https://www.clearcapital.com/resources/glossary-of-terms/above-grade-square-feet/
    “Above Grade Square Feet is the term referring to all living square feet in a home that is above the ground. It does not include basements even if the basement is a finished walkout or daylight basement. Lower level rooms are counted in appraisals and BPOs as below grade square feet, and are usually valued at a lower price per square foot. In BPOs, only above grade square feet is counted in the living square feet.”

    Oh thank the lord, we’ve got Clear Capitol AMC here to give us a proper definition.

    While we’re at it, what is a basement anyways? Can’t trust memory or common sense anymore. In Oceana, words can and do often change meaning for what is best for The Party. Got to keep up, already on the 7th edition.

    https://www.merriam-webster.com/dictionary/basement#synonyms
    “1 : the part of a building that is wholly or partly below ground level” (Uh oh! I’m sweating bullets now!)
    VERSUS
    https://www.lawinsider.com/search?q=basement
    “Basement – means any area of the building having its floor subgrade (below ground level) on all sides.”

    Oh no…. What does that mean? So much for commonly understood definition as understood by laymen.

    Let’s whip out the M&S Residential Cost Handbook and flip through the glossary.
    Basement. Any room or rooms built partially or wholly below ground level.
    There is no entry for above grade or grade. The entry for Slope only mentions roof pitch. There is an entry for Bi Level.
    Bi Level. A two story residence with a split foyer entrance. The lower level, partially above grade, is partially finished. Typically the finish includes plumbing and electrical rough ins, with some partition wall framing for a recreation room, bedroom, laundry area and bathroom. Other common terms for this type of construction are raised ranch, hi ranch, colonial, and split entry.

    The rabbit hole goes deeper.
    There is no definition for Finish in glossary either, but finish is mentioned in the ‘description’ segments in the various quality sections under RESIDENCE. Let’s just pick the ‘good quality’ tab.
    Interior Finish. Interior walls are taped and painted drywall with some good quality wallpaper or wood paneling. Kitchen and baths have enamel-painted walls and ceilings. An ample amount of cabinetry with natural wood-veneer finish is used in the kitchen, with a large pullman or vanity in the bath areas. Countertops and splash are laminated plastic, ceramic tile or simulated marble. Ceilings are painted drywall. Some small areas, i.e., entries or foyers, may have vaulted or cathedral ceilings. Doors are good quality, hollow core with attractive hardware. Baseboard and casings are hardwood or softwood and have mitered corners. Walk in closets or large sliding door wardrobes. Ample linen and storage closets. Workmanship throughout is of good quality. NOTE: Base interior wall height is 8′ except for excellent quality. For each foot of variation add to or deduct from the base cost only, (etc, etc.)
    There is a reference to two story bi level on pg Good-16, which says ‘apply to above grade floor areas only, see Pg 4.’

    O.k. here we go, single family dated, pg 4. Two story bi level: Two story, bi-level (raised ranch) residences have two levels of living area, but unlike a conventional two story, the lower level, which may be partially below grade, is partially unfinished. (Which is not normally true of bi levels in CO except for a small utility room) A distinguishing characteristic is it’s split foyer entry. Enter the cost table with the square footage of the above grade floor area only. For the lower level use the appropriate cost type and square footage from the basement cost table and add for the amount of finish.
    We’ve also got one for split level w/ a little tri level image: Split-level residences have three levels of finished living area: lower level, intermediate level and upper level. The lower level is immediately below the upper level as in a two story. The intermediate level, adjacent to the other levels, is built on grade approximately 4 feet higher than that of the lower level. Enter the basic residence cost table at the total floor area OF ALL THREE LEVELS.

    That was an interesting exercise. I almost threw the book but held on and kept flipping. (M&S jokes!) What did we learn? There is variance in cost approach method guidance. For bi’s they say half up full half down basement adjustment scale, but for tri’s they say the whole thing up side adjustment scale calculations. Yet there is associated guidance that bas finish area may run roughly equivalent to above grade areas.

    This is conflicting in it’s own right. Then consider how these home types illustrated above have equivalent finish. I mean that first one on Zinnia Ct, that’s high quality finish all around, hard to tell what is where but it looks like most carpeted areas are lower level. I’d run that entire thing on the upper level cost and cut my improved floor allowance in half to compensate or something similar. For tri’s it’s the same approach. For all practical purposes, that’s not a basement.

    Q7. Can appraisers use the exception code to voluntarily opt out of compliance with the ANSI standard? No.
    Q14. The ANSI standard requires any area that is partially or wholly below grade to be counted as basement; what defines ‘partially’ below grade? A floor level is partially or wholly below grade if any portion of its walls is not entirely at or above ground level (Emphasis on ANY PORTION).
    Q16. How should appraisers account for rooms located in above-grade finished areas that do not qualify as GLA under the ANSI standard? While the ANSI standard is not definitive on this point, appraisers should include rooms located in above-grade finished non-GLA areas in the room counts (Total Rooms, Bedrooms, Bath(s)) in the Improvement section and in the Sales Comparison Approach grid of the appraisal report to comply with Uniform Appraisal Dataset requirements.

    (Well hang on a darn hot minute! Why isn’t the UAD altered to account for this new ANSI standard? That’s a lazy developmental method if you ask me.

    So if it’s measurement, not qualifying.

    But if it’s counting rooms, it is qualifying.

    Sure that makes sense. That’s going to be really easy to explain to people and they’re definitely going to have a lot of increased confidence in the appraisers ability to navigate their local market, local assessors, local agents, local participators. They are going to fall in love with my comprehensive methods. So like every single example above. All those rooms, they still qualify for room counting in the 1004 like they always would have before ANSI. But we’re going to cut all their sizes in half or a third off, and we’re going to note those as basement lines or some other line.

    And we’ll run basement line adjusts for size, but there will be no room counts attributable to that size amount… Say what? I’ve never done something so illogical as that but I’d bet you a pepsi that’s’ going to fire up another warning in the EO reviewer. Because how can you have a finished 900 sq ft basement with ZERO attributable room counts? Make it make sense.

    These are called work around methods. When something does not have intelligent design, presents as illogical, the appraisers task is to find ways to describe things logically in a defensible manner. To qualify the data in a comprehensive manner. Rather than appraisers working with what works locally, we’re going to re invent the wheel here and operate contrary to how everyone else local operates. This is going to be a nightmare to navigate when there is actual size difference vs assessors records.

    We’re going to have to go old lady ninny word police and say; ‘That’s not acceptable to call the area as above grade or finished area. You have to call that (per FNMA ANSI FAQ 16.) ‘above-grade finished non-GLA areas’.

    Say what!?!?!? f it’s partially above grade finished, how is it not GLA? I’d better read up on that too.

    Gross Living area:
    “As defined by the Appraisal Institute’s Dictionary of Real Estate 4th Edition: “Gross Living Area (GLA) – The total area of finished, above-grade residential space excluding unheated areas such as porches and balconies; the standard measure for determining the amount of space in residential properties.” Jul 5, 2007

    We’ve got problems. To laugh or cry. I was mad. I’m not mad anymore. Probably going to get mad again though. This is simply not happening. Going to ignore the issue until it goes away on it’s own.$334

    0
    • Avatar Tom B says:

      My friend, Merriam Webster is not needed. ANSI Page 5 item 2.3 defines finished for you. Then Page 6 item 3.6 tells you how to apply it. Two short paragraphs.

      It’s not the Merriam-Webster ANSI standard. It’s the ANSI standard. It doesn’t matter what anyone else is doing that is not in the Appraisal Profession. It took decades before our MLS would allow for agents to report basement Sq Ft.. Now they have the spaces for it and still can’t do it correctly. Luckily most do though but there is no penalty for those that don’t.

      All those examples you provided are what I consider normal everyday stuff. It’s what I have been dealing with for my entire career.

      Agents are always going to apply the standard of “I need to make this house sound like the Taj Mahal”.

      Zillow…. appraisers are not Zillow. Do you know how many times I’ve had people ask if I think Zillow is reliable. I just shake my head and say no because they change with the weather day by day. Zillow uses the Zillow standard

      Assessors – you should be happy they are starting to put sketches in. They are making your life easy. If the numbers are close to the MLS and the visuals align, just use the Assessor figures.

      Don’t look for ANSI definitions anywhere but in the ANSI standard. GLA is above grade. Finished Square Footage can be in many places. Where do you report a Barn or Pool House. You don’t put it in the GLA, you don’t put it in the Basement and Below Grade, you put it on a line at bottom of grid and deal with it. Not an ANSI thing, but certainly you have at some time had to deal with some sort of extra and unusual valuable items that comps did not easily align to.

      As to the unfinished room above grade. I won’t say I have never seen one but some of these new homes often in 55 and over communities will have a fully finished and heated / cooled storage room but they leave the carpet out just to make it easy to store shelving, move things around, etc.. Let’s say it’s 200sf out of 2,500 total GLA. Just report the room, report 2,300. Then go down to bottom of grid and write StgRm and calculate 200sf back in.

      ANSI is simply classifying everything we measure and telling you how to measure it.

      Measure it then…
      Put this stuff in Box A, Put this other stuff in Box B, Put the other things of value that don’t fit A or B in Boxes C, D, E as needed. THEN… simply do your best by your reasoning to match your comp’s features to those Boxes and make adjustments from there.

      Once Elon Musk takes over FNMA we can use the Shiba Inu standard.

      1
  94. Avatar Tom B says:

    Baggins, you are going give yourself a stroke before April 1 is even over.

    Let me be sure I reading you correctly…. you wrote….

    “half that home is not qualified ‘Finished Square Footage’. Ignore what you’re seeing, all that finished area, the ANSI definition is the only thing that matters.”

    No No No No No…… ALL of that home is “Finished Square Footage”

    961 sf Above Grade Room Count Gross Living Area
    906 sf Basement & Finished Rooms Below Grade

    That’s 1867 sf total finished square footage. I might mixed the numbers up but it’s within a couple sq ft. of the assessor and Realtor.

    This is dead simple. ANSI is not telling you that if it’s below grade it is no longer finished square footage. Hell we have basements here that are more expensive than the upper bedroom levels sometimes. You put in a full service bar, a theater room, a wine room, a nice bath, rec room with wainscoting, recessed lighting, etc.. No one is telling you to toss that living space out the window. Just consistently report it on the BELOW GRADE lines of the URAR form.

    Nothing is being taken away, it is simply being classified in a specific manner. After it is classified by ANSI the URAR form has a place for it. If you have a house that has some extra stuff you feel ANSI sort of cheated out, just report it on the bottom lines of the grid.

    1
    • Baggins Baggins says:

      Yes, fully understood. And I get that you’re an experienced pro who is entirely credible. But you don’t appraise in Colorado. Sometimes I’ll have to comp a bi vs a 2 story with a finished basement (so then the 2 has that third fin bas level and needs adjusted down and that basement adjust tracks half the adjustment value of comparative agla areas.) Sometimes I’ll have to comp a bi against a 2 story with an unfinished basement. (so then the basement adjusts at an even lower amount than it would for finished bas areas.) All garden and ‘above grade’ (which agla is a garden level in CO), all garden levels adjusts equivalent to a 2 story at a higher adjustment basis.

      Basements in CO often drive half of what the qualifying agla areas drive in terms of price and value, sometimes even a third or less. There are a lot of homes without basements because the water tables are too high, they compete laterally with units with basements, less a little cut for the actual basement minimized value. It’s easy to cross comp bas vs no bas, because of a diminished basement value factor. If that basement is finished or not, it does not matter, the adjustment basis of basements are not normally equivalent to that of garden level and all other qualifiable AGLA areas.

      Having a basement in CO is a chore, foundation fault issues are common. Let your gutter fail for a year or two, don’t keep up with drainage, you’ve got a foundation crack that costs $25k+ to repair or more. That is not as common with bi’s and tri’s, which is why builders turned to that design factor for a myriad of reasons. It is why we get the best of both worlds with a bi level or tri level which acts as a heat sink or cooling factor and helps retain heat in the winter. Entirely different living factors than actual fully dug in basements. Hence the difference in market reactions to their value. Builders always finish garden levels with similar quality, where as basements are often items owners have to finish themselves so the basements have wildly varying cost and value factors compared to the standard garden level. Rules of thumb for CO appraising; the garden level tracks with all other AGLA as being equivalent in value. The basements have a reduced value factor even if they are finished (except for aforementioned luxury stock). Those are good rules of thumb in CO.

      Adhering to ANSI is going to take 4 adjustment lines in many scenarios. The qualifying AGLA which until today included garden level but now means only above earth, the unfinished basement area, the finished basement area if present. And now the new line which is finished market recognized AGLA, which due to ANSI technicality can no longer be included in AGLA lines, the dreaded garden level which can not be included in the top agla line even though it is market recognized as having equivalent value.

      Because that is exactly what ANSI is defining here, a third type of living area. By technicality because nobody in the real world perceives it that way, not around here at least. In CO many people including myself may prefer a bi or tri level because it’s just cool and comfy with less energy resource use to be in the garden level. An entirely different feel then being relegated to some dungeon basement which stays cold never gets sun, no egress unless you spend a fortune on a big new window well, musty, prone to flooding, spiders always trying to get in your business, need an escape ladder and a well cover so nobody falls in, the occasional bunny whom hops in and perishes with no way out, leafs and trash. None of that is present with garden levels partially below partially above grade. In the real world these two living environments are not interchangeable and are nothing at all similar. Buyers prove it too, they don’t distinguish very much between a bi, tri, or 2, if they’re all in the same market area. Luck of the draw, whatever is available.

      Shall we dive into the occasional scenario where due to sales scarcity, locational factors, where the appraiser has no other choice but to comp ranches w/ a mix of fin bas, non fin bas vs a bi level or tri level… Sometimes that tri level has a partial basement too if it’s on slope and may be only partially above grade. Toss a 2 story with or without a basement in the grid scenario. How’s that going to work when I’m comping a ranch w/ bas vs a bi level? I’ll have to draw up a special individual line item for the second half of the bi and will not be able to put the garden level lower half of the bi into the basement line, because it does not adjust at an equivalent amount to that ranches basement.

      None of this answers the logic question of how can I have half the finished space attributable to ANSI qualified fin sq ft, the other half to non qualified finished sq ft, and all of the room counts are in the above grade line? It is literally impossible under every real world scenario imaginable to have an entire half of a homes space, which has zero attributable room count. This is a fictitious reporting strategy. If there is a finished space, there MUST be a room count attributable to that.

      Now I do certainly understand the concept of scooting the data. Sometimes that is unfortunately necessary but we should not do that on purpose if avoidable. The vast majority of report readers do not understand