ANSI Measuring Standard Required in 2022
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.
- 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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How do you apply ANSI on 2055 appraisal? Please help.
The ANSI standard we apply is a standard method to measure and classify Square Footage.
You don’t measure a 2055 driveby. So IF you want to be ANSI compliant you could use assessor data and the disclosure below. That disclosure makes you ANSI compliant.
When you can’t get to dwelling and can’t trust plans, etc.. So you use the best info you have.
“Finished square footage calculations for this house were made based on estimated dimensions only and may include unfinished areas, or openings in floors not associated with stairs, or openings in floors exceeding the area of associated stairs.”
You could also probably get by with disclosure #2 and state you used Assessor records. Either one makes you ANSI compliant.
Thank you for the explanation.
Hamp Thomas says ANSI does not apply to comps, 2055 or Desktops
That may be but he would reconsider 4.6 when is the standard and not the annex, he would see that it certainly covers a 2055 driveby situation. Provided you include a disclosure similar to #3.
Those disclosures make you ANSI compliant.
Item 4 Statement of Finished Square Footage.
“Failure to provide the declarations listed below – where applicable – voids any claim of adherence to this standard.”
Item 4.6 — direct measurement not possible, access to interior not possible. Nature of terrain, obstacles preclude direct measurement. Building dimensions developed through some means other than direct measurement or plans can be susceptible to inaccuracy.
All of those descriptions apply to a 2055. You still have to research and report GLA and your sources on the form. In doing so you can be within ANSI standard with the proper declaration. Regardless if FNMA cares or not.
So you do it as you always have. Find the best sources for sq ft and use it. State you extraordinary assumptions. Nothing different. Not sure what you are getting at.
The person above asked how does ANSI come into play with a 2055.
I’m not getting at anything other than to answer his question. You can be ANSI compliant easily but ONLY if you include a declaration as to how you got your GLA etc..
I have not read nor heard that FNMA does not require ANSI for 2055s. Perhaps I missed it. But I have watched Hamps videos, taken the classes, and am re-listening to his webinar from the other day.
That is using the standard and will easily work for a 2055.
Exactly right Mr Kues. Appraisers are not perfect and we use a process of best estimates to arrive at a best of ability opinion. Which is why it is important to have the net/gross indicators present. Because from a 0%/0% pre adjusted items application to the appraisal grid (starting point), after that point we can have our finger on the pulse to know if we’re applying adjustments in a reasonable manner by constantly reviewing the net/gross indicators. Something that will not happen if we have to do something like add back something purposefully subtracted even though all comps have basically the same market value (false starting point). A bi vs a 2, starting at 0%/50%, even though that should be 0%0% (presuming exact size matches). A bi vs a tri, something like 25% gross start even though both units have matching space recognized by the market. Even manipulating a set of tri levels with basements, somehow discrediting their garden levels. Paired sales analysis can be done within the appraisal grid itself.
Here is another example. Three tri levels with unfinished basements. Image attached. That means 4 total levels in these houses. MLS short blocky type view image attached. All garden levels are market recognized and are contained in the ‘above grade finished’ count and are included in the ‘PSF above grade’ lines in the MLS listings.
3x zillow links, in order.
https://www.zillow.com/homedetails/11734-Steele-St-Thornton-CO-80233/12958619_zpid/
https://www.zillow.com/homedetails/5064-E-112th-Ct-Thornton-CO-80233/13003535_zpid/
https://www.zillow.com/homedetails/11240-Madison-Ct-Thornton-CO-80233/12960047_zpid/?
The second one on 5064, don’t let your eyes deceive you, it looks like a 2 story but note the window on the back and side, it’s lower near the earth, that is sunk in garden level. It’s all finished area and is part of the market recognized above grade square foot area, counted in the various ppsf metrics. This particular set of tri’s I sought out because in this certain size range, we can have a lot of tri’s w/ basements. But according to ANSI, those now have two distinctly different basement areas. The garden vs bas track at a different price basis, that’s obvious in the ppsf metrics. No appraiser defense is necessary and there is no assumptive basis anyone can challenge the appraiser on. That is just the way it is. If the appraiser steps in and claims that garden is part of the crummy basement below, watch out. That would be one incompetent appraiser.
Example 3 is another pickle. There is a sketch included in the listing but it does not appear very reliable. The sketch is clearly larger than county records. Also the list agent just copied county for listed size and did not use that size statement on the sketch for his listing record. Also the sketch omits the basement. That may be a sketch which shows how use of ansi counting stairs brings a size number which is higher than county stated, causing a logical need to subtract stairs out for apples to apples comparisons as that may be how they counted size on these homes initially. It’s a constant challenge having to figure out if I need to cut out stairs or not, otherwise my subject can have an extra hundred or so sq ft compared to it’s model matching counter parts. Also all three of these units, none have their garden level cut out or parsed into anything other than the above grade square foot line by the assessor. Also adams county does not post sketches online alongside the assessment records and although I have not tried to get one in many years, they never used to let you call up to get one for free either. So it is impossible to find garden level size parsing. Therefore if subject was stated ‘ansi compliant’ in the grid, we’d have a false starting point because subject would instantly need adjusted up roughly a quarter to a third for having lost qualifiable above grade living area, which would need to be moved elsewhere. Appraisers here state move that to the basement. But what about the actual basement needing a different adjustment basis? Even if we could scoot around that and co mingle garden and actual basement in the basement lines we’d still be presenting misleading data and false size indicators by showing in the appraisal grid we’ve comped a smaller subject vs 3x larger comps. It makes no sense and would be a ficticious reporting strategy to be ANSI compliant if dealing with a bi or tri level in CO as a subject. Screws up the comps good too although some assessors do parse garden so with a lot more effort it could be done with a series of line items and much longer explanatory addenda.
https://gisapp.adcogov.org/quicksearch/
(just pop in the first numbers of the address, select from the list, easy to use assessors call ups.)
You can check their assessors property records here. Keep in mind nearly all MLS listing is auto imported from assessors data. Adams county always includes garden level in the above grade room credit, so if you see basement that is a true basement and is not garden level. The tries have such varied designs and basements were never builder finished, but garden was always builder finished. Tri’s w/ basements, that’s almost always utility unfinished and sump pit & pump if they needed that, built like a staggered 4 level where a basement is often under the mid level and although it’s hard to see in a listing photo, there is a small basement window well under the mid level often on the front. The alternative design if no bas present would be mid level on slab or over crawl but the lower would still be qualifiable agla space garden level.
Here are the ppsf metrics for all three of these. I straight copied this data from their MLS listings. If somehow that garden is scooted into basement line it’s going to be a mess. The metrics are comprehensive as is.
11734 Steele. / Building Area Total (SqFt Total):1,700Living Area (SqFt Finished):1,700Above Grade Finished Area:1,264Below Grade Total Area:436Below Grade Finished Area:436Below Grade Unfinished Area:0PSF Total:$250PSF Finished:$250PSF Above Grade:$336
5064 E 112th ct / Building Area Total (SqFt Total):1,792Living Area (SqFt Finished):1,280Above Grade Finished Area:1,280Below Grade Total Area:512Below Grade Finished Area:0Below Grade Unfinished Area:512PSF Total:$237PSF Finished:$332PSF Above Grade:$332
11240 Madison / Building Area Total (SqFt Total):1,700Living Area (SqFt Finished):1,264Above Grade Finished Area:1,264Below Grade Total Area:436Below Grade Finished Area:0Below Grade Unfinished Area:436PSF Total:$253PSF Finished:$340PSF Above Grade:$340
Other terminology notes: Garden level; qualifiable agla space. AGLA: above grade living area. GLA: gross living area (meaning total of all basement, and qualifiable agla) Below Grade (as recognized in CO assessors & MLS): True basement, does not include garden level.
With ANSI standards, Colorado loses a lot. FNMA should immediately add bi level and tri level homes to the allowable exception list to opt out of the ANSI standard.
Thank you Tom. Yes I get that. One thing I’ve learned from this specific blog, is that around this country it is not customary to count garden levels as above grade space. I don’t know, I’ve always taken that for granted. We’re pretty stunned at the concept of disqualifying garden away from agla spaces here in Colorado. It’s a rather foreign concept. Garden levels are very common in Colorado, they’re always finished, never unfinished in maintained houses, and are always reported by assessors and realty agents as being above grade spaces.
Take my examples below I posted today where the assessor does not break down the levels and due to design variances those tri levels may have substantial variance in what is attributable to the bottom garden level or not. One even had such a big mid level, it was an a-typical rare example with a really large true basement under that mid level. (4 total levels each) You don’t have to dive into them but more examples, fyi. Three tri levels all with garden levels as the third, and a fourth level which is true basement fully below ground not garden, usually not finished but sometimes finished by individual owners at a later date. Assessor reports only all above grade (which includes garden), and true basement, no other per level reporting. Simple straight forward, reliable standards of reporting are already in place here in Colorado.
In these scenarios if ANSI compliant my report will read like I’ll miss size bracketing even though I have sized bracketed. I’ll have two different adjustment basis in the basement line, which may then cause the need for the garden level to be scooted off the auto size grid lines entirely to one of the lowest 3 free lines. No matter how I do it I’d be guessing at comps or manipulating my subject but not my comps, missing bracketing, it’s a problem no matter how you approach. It is because the data is already uniform to begin with! Any manipulation after that point is nonsensical. Just non stop alerts, false high net/gross indicators. That’s just not good appraisal methodology to manipulate the subject data for the sake of consistency, especially when it would not be possible to get an accurate figure on the garden level space for comps, and the data was consistent in the first place.
Just because our uniform reported data is not consistent to ANSI is irrelevant, most of us have never even heard of the ANSI group until a month or two ago. They do not have influence or sway around here in the real property industry, they never used to until FNMA did them this special insider favor and granted them special privileges. Even if I could get that garden level exact size which some counties offer, it’s still not a good method to break the garden level apart because some gardens are small spaces others can be very sizeable, but the market does not distinguish, it’s all about the total space. To run that on two lines above and basement, would just be a confusing approach in the grid where adjusts are taken then given back (juggling adjusts), which drive up gross but not net. It’s a nonsensical adjustment, to adjust something the market does not recognize as needing an adjustment or driving any tangible market reaction difference. This is a violation of the very core principals of valuation comparison, honest transparent comparisons with the intention of finding more similarity rather than less. Why falsely indicate a dissimilarity when no dissimilarity actually exists in the first place? They can’t just walk up here into colorado like the champ wearing a crown and smack us all down, tell this entire state we’re doing it wrong and have to comply with their methods instead. Who do these people think they are? The ANSI group and their puppets at Fannie are not as smart as they presume themselves to be either. I’ll illustrate that below.
That is not what net/gross is supposed to be there for. As automation has taken hold too many appraisers have become reliant on extraction and automatic tools. Net gross expression is a vital tool for manual method and thoughtful logical approach appraisal development, and competent review services. You never adjust out then adjust the same thing right back in if you don’t have to because that creates a false gross adjustment amount. Net/Gross is the primary most important number set in an entire appraisal report. Never manipulate that falsely. It is the ultimate test and indicator of reliable or faulty appraisal development. Net/gross is king, not the final value opinion or any other number.
The way it’s supposed to work is the net adjustment indicator is the indicator of total meaningful difference. Net is the material differences, an expression of the actual true volume of difference on the balance, all told. If your net adjusts are very high, and far apart, it may be something like comparing a gem against a dog terd, could the appraiser have found better comps? A high net is very disconcerting and must be explained away or find better comps.
The gross is the indicator of actual similarity or dissimilarity of type. So even though a high gross adjust indicator amount may be present, that gross adjust climbing upward indicates the appraiser had to mix and match comps or pick comps which were notably varied in terms of size or difference somehow, usually due to limited comps scenario because if you have good fairly equivalent comps, gross moves right alongside net pretty closely and gross stays low. It can be acceptable to have a high gross, as long as you have a low net, because that tells the appraiser he’s somehow found a fair balance. That is often from a difficult comping scenario, comps scarcity, etc.
You want low net and you want low gross. If you can’t find good quality matching, you end up with a net that goes up, gross will stay close to net. If you can’t find similar structure or space, have to compare large to small, etc, you end up with high net and really high gross. It’s just what happens when there are no comps and you have to use what is available, higher net/gross. If you’re lucky you’ll make it work and have low net but high gross. That tells the reader; mix and match comps, but appraiser proved a reliable market value despite the challenges. If you have high net and high gross, missed the balance and have to use the weighted comps theory and logical reconciliation, perhaps rely on cost or income because reliable market indicators are not there.
When you’re comparing a set of bi levels, tri levels, and maybe a two story, one expects the bi vs tri or bi vs bi to all have low gross adjustment indicators which does not move very far from the net indicator. Because by type and size, these are very similar houses. The low gross adjustment indicator is the proof point which the appraiser can use to deflect liability and defend his work, to prove that we’ve selected meaningful comparables which are very similar. As size is one of the most substantial adjustment factors, low gross often rides along with good matching size comping selections. And if they’re all reasonably similar quality and material wise, you’ll have a low net indicator too because fewer adjustments would be applied. Low net. Low gross. High confidence in the appraiser. Appraiser can have high confidence in his adjusted value indicators and final averaged reconciliation too. No weighting or preference for one comp or the other is even necessary. Finger on the pulse. Doing it right. Competent selections. Winning.
To purposefully jump the gross adjustment by taking then giving back, one would purposefully skew a very important proof point and defensive point in their own work. Aka butchering the gross indicator before any truthful adjustments are even applied. It makes no sense. Forensic review, portfolio, others, they can all utilize automatic review tools and one of the things they’ll look for is net/gross elevated. One could scour thousands of reports and by way of automation pick out the worst most poorly developed and/or most challenging appraisal scenario appraisal reports, simply by looking at net/gross alone. Although the dreaded 15%/25% limitation is released, it’s spirit still haunts the hallways. And rightfully so, that is the most important indication of quality development contained within an appraisal report. Net gross is the cumulation of the entirety of the appraisers efforts in grid filling.
A good way to stay under the radar in this industry is to be very careful in picking comps and developing comprehensive market research packets to select comps from. By narrowing down the research, sales which are going to be better matches against the subject comes forth, ideally a set of model matches. If they’re all same quality and same size, you end up with very low net and very low gross. And you can achieve that with a set of tri’s two’s bi’s or even ranches, cross comping, etc. My experience has been ranch is a category to itself in terms of seeking best matches, I do parse ranches out on their own if I’m able and there is enough market data to work with. But bi’s, tri’s, completely fully interchangeable without much ado. Not anymore!
This is what the Fannie people and amc people don’t get, probably the ANSI people too. They’re lost in the automation and theory of it all, but they’ve never actually done the work. They’ve never actually filled the appraisal grid all day manually. They can’t do this job outside of the digital realm, developing competent valuations with pen paper and a quarterly MLS book. Appraisers whom rely on comps sharing, adjust extraction, everybody new whom came after automation has been utilized, they don’t get it either. I like to say if you can’t do it on a paper with a pen, you don’t really understand what is happening.
Like there is this one appraiser around here whom fills 12 comps every time. He scoots the low net/gross to the front and leaves the rest in there. Adjusted value indicators can be a hundred thousand apart. He uses automation to bring in too many, applies automatic adjust method with too much focus on gla from mass data extraction, and then assumes he’s got the best comps in the 1-3 & 4-6 slots because those have lower net/gross. But this yahoo leaves the other 6 in there for two additional grid pages, and those have high net gross and adjusted indicators far apart. He’s proving incompetency without being aware of it and clients are stunned by his brave use of that many comps. He gets more work even though he’s clearly doing it wrong. If he took the time to adjust carefully and pick comps which are truly better quality and size matches, he’d always have lower net/gross, better streamlined adjusted value indicators, and there would be no confusion or need for more than 6 comps on two pages. He demonstrates to me his total ignorance of the net/gross indicator and it’s importance. He’s also in turn proving he’s not spending enough time looking at comps individually and adjusting fine details competently. He’s one of those 4 appraisals a day type of appraisers.
The FNMA forms were developed a generation or two ago right? They were the product of careful design and work groups where appraisers and valuation specialists needed a variety of cross reference points to affirm or indicate a great many things about competent appraisal development. Bear in mind most of that came pre automation days. Net/gross is there because it is a simple mathematical measurement of the total volume of adjustments which expresses two important things; balanced similarity (net), and total difference (gross). To purposefully jump that number for matching model or homes which compete laterally on the market, that is not inconsequential, it is everything, the whole enchilada of valuation theory out the window. If we can’t present and read net/gross honestly, there is no need for manual methods or human appraisers anymore.
Then we’re back to local standards. These local standards were developed over several generations, sometimes hundreds of years if out east but often a hundred or less out west as the pioneers faced many challenges and a long road before affirming statehood and carving out their own uniform approaches to due process. Just because it’s one way over there does not mean that specific method is applicable elsewhere. And that is a great strength in American housing, the high variety of approaches. It’s what keeps local local and stops carpetbaggers and tycoons from exploiting markets far away. In their wisdom many often purposefully engaged in variety reporting methods and for a variety of good reasons. Out East this ceiling thing, must be due to weather and temps I suppose, make good use out of a limited space. Cape cods or whatever. Coastal designs. Out here out west, sloping challenges, expanding soils, desert climate conditions followed by wild temperature swings that can crack a saturated foundation in a single day. Different design challenges and different solutions. That’s called smart building concepts. There was good reason for the build differences and recognition of their design and space feature differences. We did it our way and it still works to this day.
Enter the know it alls from washington or whever this is coming from. Charging in like a bull in a china shop DEMANDING we all do it their way or else! It’s no coincidence there is money and special interests involved. To disrespect our local customs and insist we do it their way… Fighting posture. Threatening appraisers whom respect local traditions with denial of their ability to push reports through FNMA, plainly disrespectful behavior.
Q7. Can appraisers use the exception code to voluntarily opt out of compliance with the ANSI standard? No
Says who!!! Who specifically made that statement or decided that for all of us, for our entire state? I want names because I want heads. Step up and take responsibility whomever you are. Telling me I don’t know what I’m doing and I have to change or else, despite our entire state not doing it that way. Even if I complied I’d lose the primary defensible point I’ve always relied on; competent net/gross indicators. I’d violate many uspap ethical principals on promoting trust in the appraisal profession. I’d confuse agents buyers sellers alike and paint a target on my own back. Perhaps that is what FNMA really wants, all the human appraisers gone.
Here is an interesting logic question. We’ve learned there are high variances for how these bi and tri level homes are built and finished around this country. In some areas people mention bi’s usually function as raised ranches, no fin on the bas side. I can see where the confusion comes from now. Our terminology may be similar, but the local market recognition of that terminology can be quite different. Have you ever seen a raised ranch with a second basement? How can a tri level w/ a basement become a two level split with two different basement areas? How does one build a home with two basements? This word smithing will not abide. Leave us alone ANSI, get out of our business, we don’t need you in Colorado. ANSI is not welcome here. ANSI GET OUT. ANSI GO AWAY. I’m not going to be made a fool on my own front porch.
Baggins,
Imagine all the Garden homes/flats in New York. Now they will have no GLA!! Wonder how FNMA will deal with these wealthy people screaming when that happens.
FNMA changes entirely when they realize they are making up procedures/stipulation that cannot apply in all situations in EVERY market at all times!! It just takes them years to get to the conclusion
“THAT DOES NOT WORK”…
Markets differ from state to state, urban to rural, area to area county to county style, condition and even seasons as ALL Appraisers already know and adjust to as and when required. No one shoe fits all. No rule or guideline or method can apply in any field that is not homogeneous. With so many variables you would think these Entities would realize they need a lot of research and a lot of field work to be able to implement new ideas into a process.
Not that progress is not appreciated and needed, Lord knows I was glad no more pasting photos and no more 1 hour photo pick ups, no more sending reports over night!! I was glad I did not have to visit the Court houses of small rural towns and thumb through property cards or look at the flood map cards or , well you know what I mean here. But when things get changed that do no improve quality, reliability or work file or CONSUMER protection then I have to say why?
It seems everyone here and many or most that are not here were already using uniform measurements. In the 1000’s of hours of education in the dozens of classes and all the Appraisers in them I have never known any of them to measure any differently than what we are talking about right here. So I have to ask “is it true” were a lot of appraisers using their own method of measuring that was so different than the rest of us? If so why would the lenders continue to send them work? How did these people pass the tests required to get licensed? HMMM . I don know if I can swallow this story now. JMO
Today I used the ANSI method as always and the Auditors card was 6 inches less on the front wall. I realized the new vinyl siding corner mold added 3 inches at the corner of each end of the wall. Without the molding the auditor’s card was accurate and matched my hand measurements to the inch. So rounding made it 10 inches more than the Card and 10 inches more than it really was. So much for accuracy and uniformity.
Any way here is the last major change FNMA decided no longer worked and forced appraisers to use inferior comparable to what was a much better one.
Fannie Mae recently made some important changes to its policies on comparable sales and gross adjustment guidelines. Their newly launched Collateral Underwriter (CU) took effect on January 26 2020. It’s important to be aware that the rules of thumb many appraisers are accustomed to using for adjustments may no longer apply for appraisals on Fannie Mae loans. For one thing, Fannie Mae has eliminated the 15% net and 25% gross adjustment guidelines.
According to the agency, it will no longer have specific limitations or guidelines associated with net or gross adjustments. “The appraiser’s adjustments must reflect the market’s reaction (that is, market based adjustments) to the difference in the properties [of chosen comparables],” according to Fannie Mae. That means that appraisers shouldn’t use a $20 per square foot adjustment for the difference in the gross living area based on a rule-of-thumb when market analysis indicates the adjustment should be $100 per square foot.
Instead, Fannie Mae expects appraisers to analyze the market for competitive properties and provide appropriate market based adjustments “without regard to arbitrary limits on the size of the adjustment.” In other words, appraisers will no longer be constrained by gross adjustment limits.
This is important to keep in mind Appraisers who always use a $20 per square foot adjustment will likely find their appraisals are flagged by Fannie Mae.
The agency also revised its policy on the age of comparable sales selected by appraisers. Appraisers no longer need to provide an explanation when using a comparable sale that is greater than six months old. “In some instances it may be appropriate to use older sales with proper time adjustments rather than a dissimilar more recent sale,” according to Fannie Mae.
So, comps that have closed within the last 12 months will now be considered by Fannie Mae. And in certain cases—such as on subject properties located in rural areas—it may not be possible to find three comps that sold in the last 12 months. In those cases, appraisers may use older comps as long as an explanation is provided, Fannie Mae clarifies. SO ALL OF THIS TIME WE BROKE OUR NECKS TO COMPLY with something they now understand can not ALWAYS WORK RELIABLY!!!
FNMA mis-spells comparable in all of their writings so how can they tell us how to do our jobs?
Just saying LOL
Very well informed commentary. You really know the inside and out’s BA. Appreciated.
Anyone have follow up on the speculation/ rumors supposedly out there that FNMA was going to pull back on the ANSI mandate? I mean NAR even sent an objection letter. In this instance the appraisers did have an influential supportive group.
For the supposed sketching variance, think of the possibilities. A faulty digital device, an obstruction to the laser which perhaps the appraiser did not recognize like a lamp or something, the software or hardware settings with digital measuring devices, calibration. Then you’ve also got the contractor methods to consider for adding or swapping siding. Like stairs in our industry, contentious, there is also an ongoing argument among contractors which will never end; to wrap new siding over existing siding, or to never do that and always pull the siding off first instead. There was a bi level up the street which wrapped over and they used something like a half foot to a foot wide styrofoam board panel deal right over the old siding, so now the windows are inset that much, it’s noticeable. Geesh, do I measure this off the brick which is 2 inches out or the wood paneling? Ideally you want to grab a foundation edge but the tape does not always hold. Tape slack, old stretched vinyl 100 ft tapes is something most appraisers dealt with at one point or another. The CG guy whom measured my house once used the old wheel and clicker deal meant for measuring ground distances, ran that right around the side and swore it was the most reliable method, but it took skill, he had to count the clicks for every rotation. Then you’ve got the do not have to be licensed to ‘inspect’ which rolled around for appraisers again so many years back. I really enjoyed that window where I could proclaim; only a licensed appraiser is authorized to complete this task. And in the future we’ll all get to speculate and cut jokes about how the pizza delivery uber driver or whomever is running ‘third party inspections’ as a side gig may have botched it up. The possibilities are limitless, which is why we have the redundant verification of qualified data guideline. Apples to apples. If lenders would slow it down for each and every instance of ‘substantial measurement variance’, they could always order free county services and have a government assessor run out there for size measurements too, I believe that’s a free service for home owners. But then they’d lose jurisdiction because FNMA can’t boss government assessors around like they can independent 1099’s. But it irks me that we’ll go through all this effort to identify instances of faulty size data but nobody even follows up to correct the assessment record. Either they believe the appraiser on this matter or do not. If there is a valid concern about reported assessed size, why doesn’t FNMA have a policy directed towards lenders and/or amc’s to assist the home owner and get that straightened out? Time is money, for everyone except the appraiser, let the next appraiser sort out the same ridiculous data challenge when they refi again 6 months later and keep all previous solutions and data secret from the next appraiser.
We’ve discovered here, there is a lot of static noise and confusion about this issue, due to varying building trends and the way local jurisdictions report and record size. My biggest take away from this enriching thread was that CO has a different standard for counting garden level than most other locations. I just took it for granted garden level was not basement but apparently that’s a somewhat unique situation for our state(s). If anyone else has meaningful information on that point, how many states do count garden as above grade, vs do not. I suppose it’s a mountain thing. All the conversation on ceiling height is foreign language, I’ve only ran into ceiling height questions once, perhaps twice. And the stairs… I’d rather fall down a flight of stairs than argue about the nuances of counting stairs anymore. LOL. Thank you all so much for the conversation and clarification here.
I think you have been measuring split-levels and bi-levels wrong. In my experience the split-level homes you show in the photos will have unfinished areas in the lower level. Typically a utility room that contains HW tank, HVAC and the laundry. So when you count the lower level finished are in the GLA where does the unfinished portions of the lower level basement get value? That why I have always extracted out the lower level as a basement. It all gets value, just on a different line.
As I stated before in this blog,
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.
You should rephrase that; You think the entire state of colorado have been measuring bi’s and tri’s wrong. Again; as the assessors, builders, realty agents, and appraisers all do positively count the garden level as above grade areas. Because that area is always finished and it’s a great space to live in, preferable to many due to weather and climate factors here.
Specifically I had posted two different sets of properties. The first round of banter contained four examples, one from another poster, three more from me. That demonstrated the nature of bi levels in three different counties, how the lower level is always finished, less utility room. Also detailing the varied nature of assessment reporting, some assessors positively do not parse the garden level into ‘basement’. (more on that in a second.) The second set were tri levels with basements, meaning four levels. Yes that lowest level under the mid section is true basement, window well and everything, random factor if anyone had ever finished that area at a later date. Yet all of the half way below ground garden level areas are always finished. That can be verified in the listing photos and I took time to detail several important observation points for those houses. The second example set were all from Adams county where the garden levels are noted in above grade, all the realty agents enter with that figure. Adams has only above grade and basement, they don’t even recognize garden level as it’s own reporting line.
Again, experience and anecdotal observations in one market setting does not equate to a similar or uniform approach in other market settings. Builders always furnished the lower garden level as finished area in Colorado, less a utility area. As detailed above, it’s because of the climate, maximizing space, and when most of those bi’s and tri’s were built circa 1970 was when they were being built prolifically it must have been difficult to sell in Colorado and although we were growing, growth was no where near the pace of other states. Builders if they did furnish the splits and bi’s w/ unfinished garden levels in other locations, they must have turned to a different standard of finishing here in Colorado, because the garden level is always finished space in Colorado.
For the utility room, yeah those can be present and often are. But also that is usable space and this type of single family housing stock is common in suburbia areas where updating and remodeling is also common. Due to age factors most of the 70’s stock and even 80’s & 90’s has seen some sort of updating. Given recent market growth which is truly exponential since the housing crash recovery, there has been additional market incentive for more thorough updating and remodeling. Investor fix and resellers have turned our housing stock over one at a time, constantly improving units in great quantity, always busy. It is now rare to run across dated units.
One of the constant improvement approaches is to utilize large utility room spaces if they were present. That space has often been transformed into a nicely finished laundry type area, turned into another bed or extension to living area, or has been in some way downsized into a smaller utility area. Also there is the apples to apples consideration where knowing that space exists, but observing comparable examples all stating the entirety of the lower level in their listed space entries as finished space, we can make reasonable and reliable assumptions there may be some small volume of unfinished space. If it really is hard to tell, which is why I often will say 90% finished or 95% finished for all comps and my subject, even if the listing agents state 100% finished. Over time agents have read enough reports of appraisers taking this approach and even though assessor will state 100% fin, the agents will sort of get ahead of that and list 90% or 95% finished for the lower garden level.
The question remains; what is more important; adhering to local market standards or some rigid non flexible approach which is adhered to elsewhere but not your market? I would not tell you that you’re doing it wrong, if there was proof those split levels treated garden levels like basements, and they were rarely finished. If the garden can be positively proved to track at a lower value basis. We would expect the same respect here, given our different market factors where garden is always finished and always tracks the same as above grade finished spaces.
If anyone has a problem with the way we report housing size in Colorado, feel free to call the Colorado NAR, every single head assessor for our 64 different counties, our 8 different MLS groups, and DORA, the division or regulatory agencies or our state.
I’m not making this up to argue on blogs. It’s a fact. In the largest MLS district in Colorado, where RE Colorado MLS operates using the Corelogic Matrix MLS system, accompanied by Realist systems, and data shares with 2 or 3 other MLS groups and new construction listing services, GARDEN LEVEL IS COUNTED AS ABOVE GRADE SPACE.
As noted above, this is what the confusion is about and apparent lack of cohesive understanding in appraisers communications. Obviously accentuated by the dictatorial FNMA whom thinks they can and should over ride our local customs to grant special privileges to the ANSI group. ANSI group is tied into major builders and builders compete tooth and nail here in CO right now. Looks like a special favor to me.
Just think of the market competition here in Colorado. If you’re not aware, buyers compete by 2 dozen for each listing, sometimes more. Sellers list and fetch within hours, sometimes days. They get 10 contracts in the first day and there are lines for showings. New construction outlets presell units and have waiting lists months out sometimes. Land for sale is common where it’s still available, asking prices continue to rise. Previously defunct housing and industry areas are all getting scraped and rebuilt, as builders race to furnish housing units as this state swells to accommodate more than a million new people, possibly two million. (nobody knows for sure how many people are actually in Denver now.) Zoning coding changes rapidly in some areas.
ANSI should go tell eskimo’s how to build igloos or something. We’ve got our own system of building methods and space recognition down here in Colorado and it works well. The fallacy of the idea that a little tiny teeny weenie particularly small body of like 15 people on some ANSI work group and another 15 ‘consultants’ whom are all volunteers from one small corner of this country, only experienced in their markets, being able to set a workable uniform standard for the well over 3,000 counties in this entire country. That’s straight up absurd and demonstrative of severely over blown hubris and ego. ANSI group is not that important and FNMA does not have jurisdiction over anyone or any business except on a voluntary agreement basis.
Nobody can have that much experience in all those markets, not that small of a body at least. Which is why we are supposed to have ‘democratic process’ in this country. You know, where we get a say on the matter and are not led by dictatorial decree but rather have influence in our own bureaucratic approaches, due process, rule making, legislative authority, jurisdiction. Oh who needs all that liberty, freedom, fair representation anymore in 2022? It’s a new world order as we race to global standards. Be careful what you wish for. ANSI group and their puppets at FNMA have really put the pie on their own faces this time, stepped on a rake, slipped on the banana.
Baggins….Why are still giving yourself a heart attack, Why are you are making a mole hill into a mountain? The appraisal Gods have spoken, they want all appraisers using just another American Standard. Frankly, the definition of what is below grade is not up to you, its not up to realtors, its not up to assessors. Its not up to lenders. This below grade area has been around for more than a decade or more. 20 years ago, a company from believe it or not was from Colorado, told me to re write a bi-level with the lower below grade as basement area, I told them I would have to rewrite the entire report because I had to use some split levels as 2 comps. Our assessors and realtors don’t do this below grade area either, Ya, its a pain in the ass, But I am actual amazed that you haven’t been called out on this by now by your lenders…..You simply have not been following the definition of what “below” grade is all these years in regards to the appraisal definition of what has to be considered to be reported as below grade in our reports. Moving to the ANSI system of measuring doesn’t seem to be your real problem. More like being told what to do and some Kobal type conspiracy rhetoric of a new word order taking our fredums away. Again, I say to you I considered you one of the most intelligent appraisers on this site. My advise, I think you are watching to much far right wing media.
For example…..Which is why we are supposed to have ‘democratic process’ in this country. You know, where we get a say on the matter and are not led by dictatorial decree but rather have influence in our own bureaucratic approaches, due process, rule making, legislative authority, jurisdiction. Oh who needs all that liberty, freedom, fair representation anymore in 2022? It’s a new world order as we race to global standards. Be careful what you wish for. ANSI group and their puppets at FNMA have really put the pie on their own faces this time, stepped on a rake, slipped on the banana.
“You should rephrase that; You think the entire state of colorado have been measuring bi’s and tri’s wrong. Again; as the assessors, builders, realty agents, and appraisers all do positively count the garden level as above grade areas. Because that area is always finished and it’s a great space to live in, preferable to many due to weather and climate factors here.”
Well not everyone in Colorado…
https://www.historycolorado.org/bi-level
“The Bi-Level came into popularity in the early 1960s as a variation of the ranch type. The raised or garden level basement makes the lower level more livable by allowing the lower windows to be larger and above grade.”
There is that pesky word “basement”
Tom, that’s interesting. Never reviewed that site before.
Let’s look at the split level example too.
https://www.historycolorado.org/split-level
No mention of a basement, curious.
Conflicting guidance. Conflicting definitions.
Not conflicting at all….. they used the term “partially below grade”
Like the URAR form … Below grade room count and square footage.
” a noisy living and service area on the partially below grade level (represented by a family room and often a garage)”
Another thing about Tri-Level vs Bi-Level. As mentioned the Bi-Level was designed off raising a ranch straight up to get some light into the basement.
On the other hand the Tri-Level was designed for a side sloping lot. If you look at the picture in your link the one on the right looks to be fully above ground because the lot slopes just the right amount to be able to built it that way.
The one on the left the lot does not slope enough and they ended up with partially below grade. AKA in your region a garden level basement same as the bi-level.
We are ALL appraisers here. I am sorry but I think we need to be a little more open minded to what others may bring to the table. Just because it’s not what we know or do in our area does not mean we are right and another Appraiser is wrong. Really how do we know what happens or is reasonable and excepted in areas we never worked in? So if it isn’t what you believe or experience it is simply is wrong?
We all know that we all have passed the educational requirements, experience and testing to perform our jobs creditably and with ethical reporting and defendable data. So why be so closed minded on another persons experience? When a Lender or anyone not experienced and /or licensed in our field decides to make new stipulations or rules that appears to be in conflict with what we know to be good for the Market and the public we should ALL be hesitant and question. It is very possible that we are more accurate and knowledgeable about the new innovations the lender came up with. You see no one here (as far as I can tell) is against uniform(ANSI ) methods of measuring. ANSI does not dictate how to adjust or grid or inspect and they do not deal with the public in Real Estate, investing or changing popular concepts of construction or trends. They simply develop methods for uniformity in hundreds of products and services and more.
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.
No where did I read ” appraisal experts or Real Estate experts” or really qualified experts in any field that we are dealing with in these discussions. I also do not see any where that they believe their standards are infallible and the end all be all in all situations every where. No where is there a statement that the method they have developed is with out error or omission with no need for modification ever. WE know these lender are like thistles in the wind. From down payments to risk management and no doc loans to LTV and LTI they change all the time. So why in the world are we so inflexible when one of our own disagrees when they implement things that do not work for all of our world! Common people we are problem solvers, communicators, researchers as well as very flexible, intelligent, individuals. We have to have the ability to see in many different ways to come to reasonable conclusions. I for one think Baggins has some very ..very reasonable and valuable and valid concerns here. I’ll bet his clients in the area he works in agree and really so do ALL people in homes with partial below ground living areas JMO
BA… So why are we not arguing about what the definition of below grade actually is? And not all this other junk?
Well IMO we should be discussing what the MARKET accepts and values not what we FEEL individually while trying to apply OUR thoughts or decisions to the entire country. It just does not work that way. IMO
If it did there would be no reason USPAP developed this….
The COMPETENCY RULE disclosure requirement calls for the appraiser to disclose a lack of knowledge and/or experience to the client before accepting the assignment, at whatever point in the appraisal process that it becomes apparent to the appraiser that his or her lack of knowledge and experience will prevent the development of credible assignment results..”
So really we could just talk about things that are different in our market. I’m sure there’s a lot of them we don’t even think about till someone changes the rules on us.
OR we could decide to Challange ANY THING these wizards come up with. Like the systemic racism in the appraisal practice being the cause of neighborhood values now being pushed by politicians and NEXT by lenders who caused the whole mess which continues still today by RED lining neighborhoods years ago!!
“We are ALL appraisers here. I am sorry but I think we need to be a little more open minded to what others may bring to the table. Just because it’s not what we know or do in our area does not mean we are right and another Appraiser is wrong. Really how do we know what happens or is reasonable and excepted in areas we never worked in? So if it isn’t what you believe or experience it is simply is wrong?”
NO…
I am not saying that at all. All I am saying is that when I see the actual data. I see the zillow photos, I see the assessors files. I see that the real estate agents have emails and phone numbers so I could call them and discuss the property. I would have no reason to not report it as it is. IF I COULD… which so far I see no reason why I couldn’t.
BTW, contrary to what has been stated here. We on the east cost actually have resort property, hills, rivers, mountains, etc.. All manner of designs.
“ALL people in homes with partial below ground living areas JMO”
Why… why should they care!? You have house it brings $400 a SF in the market for all finished square footage.
It has 1000 feet above grade and 1000 partial below grade. How much is it worth? $800,000
Now that’s the real house. That’s the actual real thing how it is built into the land. That is NOT fiction.
Ok, now take the same house and because somewhere, somehow the Real estate agents said we can sell this as all one thing. The people don’t care. So some appraisers said ok, well hell, let’s just report it as all above grade. that’s fiction but everyone’s doing it. Let’s see what that house is worth now.
Let’s see 2,000 x $400 = $800,000 — OMG the same value.
The real house sold for $400/SF
The ‘fake’ house sold for $400/SF
They both reflect what the market is doing. One is reality and could be reproduced in a similar manner by anyone following ANSI. The other is fiction and could change on a whim.
Hell I posted a link from the Colorado History society . Colorado historically recognize Bi-Levels as a basement home. I’m sure it was the real estate sales community that changed that thinking. Agents like it simple and easy. You admitted yourself that they will BS anyone with a bucket of paint and cheap rug.
Oh well we are talking about market reaction here not logic in the appraiser’s world. Sorry but very few buyers will even look at a home that the MLS sheet shows as 1000 GLA in a resort area with a price tag of 800K. Why do REALTORS report GLA larger than what it is? Why do they include basement GLA in the MLS sheet ALL the time? Because they are MARKETING the property. If you cant attract interested buyers the price will suffer. The longer on the market the lower the price. So this new rule is NOT about the market IMO
The MLS draws people to the property. ITs market appeal. Thats is the reason all the things that attract buyers are included in the MLS. That’s the entire reason Real Estate agents don’t care about accuracy. You know Quaint not small… interesting not obsolete, They appeal to the public and to public perception
Now if we are going to adjust for logic and lenders (who are the ones who made this rule because THEY state “PP SQ FT” is the most important thing to a buyer) that’s all great no garden level GLA but if, as FNMA and EVERY other recognized entity requires and recognizes that the MARKET is the most important factor in Real Estate then we should at least consider what they think, need and want as well as how THEY determine what a property is worth. Again JMO. REPEATING this over and over in any area gives us the Markets value of amenities, Location, GLA and PROPERTIES. Not some board room wizards. WE ascertain value with comparable that are sold to buyers who decide what they want to pay for the asset. But first we need to understand and extract what they think and realize the importance of it. Builders do it. That’s why “open concept is so popular here. Like pools in AZ. The buyers value them. The market wants it, buys it and pays for it! Open concepts are less expensive to build, require less material and time to build and all in all is more profitable for the builder. IT’s is what the MARKET wants right now.
So the public or the MARKET is what we need to study and know and value. Why is that such a hard concept? Just wondering
“Credible assignment results.”
What is credible about describing something contrary to the way the rest of the market describes it? Is credibility in the final value opinion, developmental methods, both? Credible to whom?
How any particular market landed with their own unique methods is not all that consequential. What matters is where we are at now.
Competency matters. So does the presentation to other people, the appearance of competency.
A finished basement that nobody else recognizes as a basement, with no attributable room counts. Curious. Two different ‘basements’. Suspicious. Reporting which is contrary to what is observed in the county record, MLS systems, and all the data aggregators. Fishy. Creating skewed ppsf indicators not aligned with the surrounding market. Incompetency. Purposefully increasing software warnings in the XML final report package. Stipulations. Purposefully creating a false net/gross indicator of dis similarity although there is good similarity in the comparable selections. Misleading. Confusing other licensed professionals whom are obviously not familiar with the ANSI methods. Purposeful misrepresentation. Presenting appraisal grid work in a sort of tangled web rather than keeping it simple and straight forward, following market standards set by the community. Unnecessarily complex and confusing. This presents the appearance of fraudulent activity and impropriety. The final value opinion is inconsequential because competency is proved and defensible based on how we arrived at the final value opinion, in relationship to the market data at hand.
To be that fringe nut job whom insists on doing something differently, or to go with the flow of your local community and community standards. To be or not to be. Go along to get along. I like Ike.
https://www.nar.realtor/about-nar/governing-documents/code-of-ethics/realtors-pledge-of-performance-and-service
Let’s consider the ethical perspective of a realty agent and the ’17 articles and related standards of practice’. We’re in the same industry and although wearing different hats the ethical principals are supposed to be mostly well aligned. Ethics is based on morality, what is right vs what is wrong.
Article 1 / REALTORS® protect and promote their clients’ interests while treating all parties honestly.
Article 2 / REALTORS® refrain from exaggeration, misrepresentation, or concealment of pertinent facts related to property or transactions.
Article 3 / REALTORS® cooperate with other real estate professionals to advance their clients’ best interests.
Article 4 / When buying or selling on their own account or for their families or firms, REALTORS® make their true position or interest known.
Article 5 / REALTORS® do not provide professional services where they have any present or contemplated interest in property without disclosing that interest to all affected parties.
Article 6 / REALTORS® disclose any fee or financial benefit they may receive from recommending related real estate products or services.
Article 7 / REALTORS® accept compensation from only one party, except where they make full disclosure to all parties and receive informed consent from their client.
Article 8 / REALTORS® keep the funds of clients and customers in a separate escrow account.
Article 9 / REALTORS® make sure that details of agreements are spelled out in writing whenever possible and that parties receive copies.
Duties to the Public
Article 10 / REALTORS® give equal professional service to all clients and customers irrespective of race, color, religion, sex, handicap, familial status, national origin, sexual orientation, or gender identity. REALTORS® do not discriminate in their employment practices.
Article 11 / REALTORS® are knowledgeable and competent in the fields of practice in which they engage or they get assistance from a knowledgeable professional, or disclose any lack of expertise to their client.
Article 12 / REALTORS® are honest and truthful in their communications and present a true picture in their advertising, marketing, and in other public representations.
Article 13 / REALTORS® do not engage in the unauthorized practice of law.
Article 14 / REALTORS® willingly participate in ethics investigations and enforcement actions.
Duties to REALTORS®
Article 15 / REALTORS® make only truthful, not misleading, comments about other real estate professionals.
Article 16 / REALTORS® respect the exclusive representation or exclusive brokerage relationship agreements that other REALTORS® have with their clients.
Article 17 / REALTORS® arbitrate and mediate financial disagreements with other REALTORS® and with their clients.
We’ve got problems. 2: Misrepresentation. 3: cooperation. 6. Disclosure of financial benefit (ANSI, and the FNMA group pushing this mandate, looking squarely at you!) 10. Equal professional service. (in the case of appraisers, this is FNMA specific, nobody else will be adopting this, so far.) 11. Knowledgeable and competent about our own market. ANSI is not, but somehow is driving our field of practice. 12. Honest and truthful present a true picture. In the case of appraisers, true to whom? Before last week that meant true to the local market standards. The perception of being untruthful and deceptive will be present. 15. Truthful statements about other professionals. They do it differently than the ANSI method around here.
I don’t know, seems to conflict with article 2 quite a bit. Realty agents live and die by ppsf metrics. If the appraiser manipulates the metrics, even though ‘the end value may be the same’, the appearance of impropriety will be strong. Heaven help the appraiser who ‘comes up short on value’ alongside the appearance of incompetence, misleading reporting to a standard not accepted in the local market, and skewed ppsf metrics not recognized by the current market approach standards.
As I said previously, once NAR adopts this, trains realty agents on it, and all the assessors and MLS services which draw from assessors provide tools and different standards, then the appraiser can simply go with the flow and adopt this too. How did I suddenly become the tool which ANSI uses to force their wares on our local market? I’m not an ANSI salesman! I do not believe in this product, I don’t want to subscribe to it, and I certainly do not want to sell others on this. Question: What happened when ANSI tried to sell this to NAR, or did they even bother? Don’t blame me that CO markets developed this way. But the market is the way it is.
Look me straight in the eye with a straight face without flinching and tell me that thousand foot of space has zero attributable room counts. I’ll call anyone incompetent and foolish because they would deserve it. Logic matters, truthful statements based in real world facts matter, so do checks and balances. FAQ on scooting all room count to above line is just lazy coding and incompetent guidance.
FNMA REWRITE THE 1004 form again! Put in a specific entry line for ‘fully below grade’, ‘partially below grade’, fully above grade. Give the appraisers the ability to adjust these three different unique space types, with three different adjustment value basis figures. And I’d like a size of deck and porch patio line which also had a ppsf adjustment. What’s the deal with specific on this estimating on that? Incorporate the cost approach into the 1004 form more than is currently presented. Where is my windows packages line? My electrical services line? My HVAC line? My lighting improvements line? My floor improvements line? Doors and trim? Fencing? Landscaping? Every little detail which drives the whole of the market value? If we’re supposed to go all out on reliable specific reporting, why not go all out on reliable specific reporting? This stinks of a special privilege being granted to ANSI. How did exacting size measurement under one specific standard become more important than the quantity of improvement in relationship to effective and actual age? Do you think property investors care this much about the standard of measurement?
Change the form entirely again, then it can make sense to report readers. What FNMA is demanding for people whom participate in markets which do not recognize the ANSI standard, is for us to report in a misleading manner.
Riddle me this riddle me that. M&S residential cost handbook says all three levels of a tri adjust at above grade, that a bi level adjusts half above grade but lower area space can be brought to an equivalent. ANSI demands all garden level be in basement lines, which includes the lower tri level. Guidance conflicts at hand.
On top of the other topics, this is a cost approach night mare as well. Two different adjustment basis calculations for two different ‘basement areas’, on a standard single family home. Curious…
Let’s do a survey and ask a simple question:
How many ‘basement areas’ does a regular single family residential home have?
One? or Two?
Care to take a stab at what the predominant response will be? The ANSI standard only exists in your mind. Sure the ability to form a work around is there, absolutely. Having to present myself like a damned idiot whom does not understand local realty customs is the hard part.
https://www.nar.realtor/education/designations-and-certifications
Did not see anything related to ANSI there…
https://www.nar.realtor/search-results?qu=ansi&p=1
Oh boy, all those thousands of NAR classes. Does not appear to be a single one for ANSI on the realty agent side. Let’s review some of the NAR letter about ANSI again.
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.
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. Once implemented, 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’ve got problems.
“A finished basement that nobody else recognizes as a basement, with no attributable room counts.”
I’ll ask again because you have yet to answer this simple question. I know this forum formats replies in a strange manner. It’s difficult to figure who is responding to what sometimes.
But… here goes.
A: The ColoradoHistory.org does view that area as a basement. I posted a link above. That’s how bi-level came about.They were a modification of a ranch with the basements fully underground and a window up higher than your head. Go read the history link. “garden level basement” Now the windows are lower. more light, better view, more appealing. Likely how the real estate agents started magically lumping everything together.
Now here’s my question…. why do you keep saying this…..
“with no attributable room counts.”” — The rooms on the in-ground level don’t disappear. Why do you say no room counts. I can’t understand that comment.
Can you give me an example with this simple scenario. I have a bi-level that has 4/2/1 above grade. 4/2/1 below grade. 1000 up | 1000 down
I have 3 identical comps.
Now you report it all above grade so everything becomes 8/4/2 – 2000. I tell you no, I need you to report it as they really are. So now you have
4/2/1 — 1000
4/2/1 — 1000
So now what disappeared. What rooms were not attributed.
“What is credible about describing something contrary to the way the rest of the market describes it?”
I suppose to answer that question you would have to ask yourself…. Where is the line of my writing a report for my client to a known standard OR becoming an advocate for the interested parties such as real estate agents.
I have no problem telling an agent that I will report the bi-level as a basement home AND that nothing will be lost. Full market credit will be given for everything there. It’s simply reported to reflect what actually exists.
“We’ve got problems.”
You may, and FNMA may. A great many of us across the USA do not.
I still think we should start a pool as which day your head is going to explode.
ANSI is a standard to measure and classify. — Do that when you measure the dwelling for FNMA
M&S has method for you to follow when using their cost service — Do that when you use their service.
If you tell someone in your report you used M&S they know how M&S wants you to figure things and that’s now THEIR problem not yours. No one has told you you have to change the way you use the cost service.
Tom B…..His head has already exploded weeks ago. He just does not want to conform. We all conformed with this below grade reporting requirements over a decade ago, I just do not know how he has been getting away with it with his lenders all these years. That is what I want to know.
This entire thread is very scary. I see why banks, Fannie and the general public dont trust appraisers. But, this also shows the unbelievable shortcoming of the reviews and underwriters!! No wonder there are so many bad loans if you cant get a simple measurement right or understand what a basement is, imagine what else is in those reports
Chris 2. The primary purpose of the licensed valuation position is to ‘protect the public trust’. There has been no shortcoming of reviewers and underwriters when they deal with CO loans. Because even within the CU modeling database, there has been general data consistency. As the majority of appraisers here up until the point of mandate by force, had not adopted ANSI because that created more problems than it solved, as assessors do not adhere to that standard by which all other market presentation data followed. Public records and assessment records which GSE review services rely on illustrated matching data. We have done nothing more than simply complied with reporting standards of local county jurisdictions and engaged in standard valuation theory approaches of likewise comparisons.
You Chris, right about now I sort of wish our local jurisdictions would have adopted this too. The fact of the matter is they did not, across this entire state.
Unfortunately, that’s someone elses department.
Chris…100% agreed !!! Now I know why they want to get rid of us….A simple thing like reporting below grade. All I hear is a bunch of cry babies who think their fredumbs are being taken away. 10+ years I have been breaking my stones figuring out lower levels….Poor babies !!! Get over yourselves. You ain’t that important !
I can forgive all of this, MAYBE, if these were all trainees. But then I would have to say the mentors are not teaching the trainees. Actually, I understand. This is the mindset of many out there. Over the years I have trained 7 or 8 appraisers. In that time when i was looking for appraisers I had MANY say they would not work for me because I ask too much of them as far as detail and “thoroughness”. I was told by at least 3 people that they could get paid just as much elsewhere and do much less. One of the few that agreed to work with me quit in the middle of measuring the garage!!! I told him he was doing it wrong, he said none of this matters and it does not have to be so accurate and quit! That was without actually measuring the house. My partner (ex wife) at the time made 1 girl cry during the inspection. We weren’t mean, we just wanted to be as accurate and detailed as possible.
The proper word is freedoms. The word is not fredumbs. You know I just went to a military funeral the other day. Freedoms is the word you are looking for. Please don’t take them for granted or disparage the sacrifice. And yes, each one of us and our individual freedoms certainly absolutely is that important.
Funny how you want me to comply to your English standard, but you don’t want to comply to the ANSI standard. I say fredumb because it applies, it reflects the insane rhetoric these days about how our freedoms are being imposed on and soon for all of us to be under one world order. Get it ?
Oh Chris. By what mechanism did ANSI become the law of the land?
And by what due process did they achieve that?
https://www.britannica.com/topic/due-process
If you think adhering to the principals of democratic process and due process is a form of insane rhetoric…
Equal protection for every jurisdiction which does comply with ANSI, but no equal protection for the persons residing in locations where local authorities have not installed an ANSI standard? Make it make sense.
This thread and the crazy reaction makes it obvious that a standard NEEDS to be used. I am amazed at what people are saying here. It actually does appear that appraisers have been making up there own ways to measure. Any home owner should be able to expect that no matter how many times they have a house appraised the living area is generally the same (within say 10 sf+-). This is not rocket science but after seeing all the sky is falling comments, it is to many here. Its all very very basic, a 10 year old can do this.
Hi Chris. In Colorado we already have this standard approach.
Buyers, sellers, and agents, do expect and enjoy a similar market measurement when the appraiser shows up. Only a rare appraiser uses ansi, or that’s how it was before the dictatorial mandate. If there was an opt out voluntary, one would expect that most appraisers around here would use that. We have very consistent measurement methods already.
And from this point forward, buyers will be more confused, so will agents. Because the appraisal will never read the same size as agents or assessors state. Because agents pull data from assessors, whom do not use ansi standards.
Ten year olds can measure a bi and tri, it’s simple. They may however, have a hard time estimating ansi compliant size data, when that garden level reporting is not available from any other data source than a personalized inspection. The grid is going to confuse them when the ansi standard is applied to subject but not the comps.
Thank you.
Which is more clear and transparent to home owners: the assessors statement of size, which the agents follow, and what they agreed to purchase. Or a varied interpretation of size from the appraiser using a measurement standard nobody else does.
I really dont understand. So…. appraisers were adding in two story areas that were not there? Therefore misrepresenting the actual living area of a property? They were pretending basement areas (below grade) were above grade and adding it into the total GLA? For what Purpose? I have split levels, raised ranch houses, cape cods and bungalows. I NEVER included basement areas as GLA. I have ALWAYS used comparables of the same style and have always been able to determine, from either my experience in the same models or by assessor data, what is similar in size to the subject as far as basement or dormers. Its really very basic and simple. I DONT CARE what the realtor things is basement. There are times when the assessor calls something basement when I know it is not while at the same time show the EXACT same model house showing its not basement area. It is for the appraiser to decide what these areas are based on a very simple concept, explain in great detail in the report and make adjustments based on this information. Sure the reader can disagree with what a basement is or isnt or a dormer area that they feel should be counted even if they have to crouch down to “use” it. It doesnt matter if I am applying what is true in the subject to what I determine to be what I feel is true to the comparable. As far as I know this is how it has been done since the day appraisers started as a “professional” group. Every house should end up to generally the same size no matter which appraiser measures it. Using ANSI just gets us all closer to ANY appraiser getting as similar GLA’s as possible no matter who measures. If I was not in this field and saw one appraisal on my house showing 2000 sf with 2000 sf basement then another showing 1800 with 900 sf basement and another with a totally different GLA I would think its all a scam and I would have no faith that any are actually professional.
Baggins,
ANSI is totally voluntary. From all you have written I don’t think you should use their Z765 standard.
just don’t do it. It’s clearly not for you.
Define; voluntary.
Q7. Can appraisers use the exception code to voluntarily opt out of compliance with the ANSI standard?No.
You asked who made ANSI765 the law of the land.
It’s not law. It’s voluntary. That means you can use it or not. It’s up to you.
Now you are quoting references to the exception code from FNMA. Different question.
Again. I don’t think you are able to reason out ANSI765 and should not use it in your appraisal business.
Oh you guys and your betting pools. I’ll take April fools day for a thousand Alex. Don’t just ask how I’m getting away with this, ask how an entire state does.
Chris a right winger political jab? Flip the coin. “I support the current thing.” This is a fun game. ‘We’re currently looking for new conspiracy theories in 2022, as all the old ones came true.’
Nope the ANSI thing is not that but is reflective of this sweeping cultural change. A tiny body of people presuming they speak for everyone else and they know best. NPC’s following without question. Good ideas do not require force.
Thank you for the compliment, I’m just one guy on a keyboard who types fast. I speed read and speed type sometimes I think to 130 wpm. And I’m good at chop internet research. Spend all this time doing it properly to the current local market standards. Take the time to become well informed if there is a valuation or data challenge. That is how I have made it all this time without a single insurance claim or state complaint I have ever been made aware of. Sure I’ve upset some people with adherence to non advocate principals but when it comes to competent credible assignment results, I satisfy the reporting and research requirements every time. Transparent reporting is the name of the game.
Why would a lender challenge me on reporting, when I prove I’m reporting to the same standard as the local market uses? When I say my subject is 1k up 1k down, and all my other comps are 2k up, that’s going to be a problem. ANSI FAQ is glaringly absent on how to report comps.
Tom, per the no attributable room count comment. Sure, we are in agreement that data scooting is an effective work around for this. But also, as reiterated time and again in liability focused CE classes for valuation service providers, the appraisers duty of service may indeed extend beyond the limited scope of the stated intended user and client. It may have been christensen law blog or one of the McKissock classes where I read this, can’t remember off hand, but it has been established before that the appraiser can not hide behind the limited client and intended user statements to avoid liability and/or culpability for a wide variety of reporting or valuation conclusion faults. FNMA chimed in on this with approved language to quell the growing movement where appraisers were using such ridiculous language as nobody should rely on this report for any reason sort of catch all. Your question is fair and the specific answer is; because the laymen should also be able to understand the appraisal report. I understand the concept of whom I’m providing services for but it does not change the nature of professional engagement expectations. If the valuation process was relatively simple and straight forward, anyone should be able to read the appraisers report and be able to understand this. To report a basement with finished size in the specific basement line, with zero attributable room counts. Imagine being a first time participator reading your first appraisal report. That’s a head scratching moment. Why would a professional do that? There is a lot to be said about being a straight shooter stand up fellow whom talks plainly, if I may indulge in a little colorful language to answer that specific question.
Chris you bring up an interesting concept: Who is ‘in charge’ of our language? Who’s the authority on definition? As you stated this long list of people whom are not in charge of this. Let’s ponder whom made FNMA in charge of the language, you forgot to include chartered GSE’s in your list. As the classic line goes; What we have here is failure to communicate.
I found this:
https://www.lawinsider.com/dictionary/below-grade
(click sample link for this below page)
https://app2.kitchener.ca/appdocs/Zonebylaw/publishedcurrenttext/sections//Section%204%20-%20Definitions.pdf
“Below Grade” means any portion of a building where the finished grade meets the exterior wall at an elevation not more than 0.5 metres below the elevation of the underside of an interior ceiling and the maximum slope taken from the closest property line is not more than 18 degrees (3:1 slope). In the case where a retaining wall(s) has been installed to meet these criteria, that portion of the building shall in no way be considered to be below grade. Where portions of a building are partially exposed, the floor area of that whole storey is considered to be above grade. (By-law 2013-138, S.13)
“Basement” means any enclosed portion of a building which is partially below grade and which has 50 percent or more of its height, from floor to ceiling, above finished grade level
Sort of ambiguous here… More conflicting definitions. Let’s check above grade.
https://www.lawinsider.com/search?q=above+grade&_index=definition
https://www.lawinsider.com/dictionary/story-above-grade
Story above grade means any story having its finished surface entirely above grade plane, except that a basement shall be considered as a story above grade plane where the finished surface of the floor above the basement meets anyone (1) of the following:
Story above grade means any story that has its finished floor surface entirely above grade, except that a basement shall be considered as a story above grade when the distance from grade to the finished surface of the floor above the basement is more than 6 feet (1,829 mm) for more than 50% of the total perimeter.
This seems to be something individual counties define in their own documents. Let’s check Adams county. They are a county which always includes garden level as above grade space, and does not distinguish between partially above grade and fully above grade in their building process and assessment recordings.
https://www.adcogov.org/sites/default/files/development-standards-and-regulations.pdf
Control + F, call up the search feature. Enter; above grade. (use arrows to jump to this word instance)
Most suburbia is A1 zoning in Adams county:
900 square feet on the 1st floor plus 600 square feet on the 2nd floor. (A lower level with more than 50% of its perimeter located more than 50% above grade level may be counted as floor area.)
Let’s check this same doc for the word basement. Adams county seems pretty clear on this.
‘A lower level with more than 50% of its perimeter located more than 50% above grade level may be counted as floor area’
11-02-249FLOOR AREA, RESIDENTIAL Total area of a dwelling excluding basement, carport or garage.
Adams county seems pretty clear on this. Before you guys just assume I’m wrong and you’re right. Check the coding and regulations for the counties you specifically appraise in. Local jurisdiction matters.
I seem to recall hours and hours of droning on continuing education and professional advisement from local appraiser group instructors whom encouraged us to be aware of the local rules and regulations. This is the very essence of being; competent in a given location. Anyone can appraise anywhere, as long as they use reliable valuation methods and take the time to be competent in that given location. When stepping into new territory that act of becoming competent also commonly includes taking the time to read local jurisdiction zoning and coding allowances. It is very important to know if structures are in compliance or out of compliance, especially if altered off permit at a later date. To ponder ‘how I’ve been getting away with this’, is to basically slander me and is a violation of the appraisers ethical principals to promote the public trust in this industry as a whole. I’m complying with local jurisdiction. Which is more credible; to recognize the rules and regs of local jurisdiction or to ignore that with your own methods?
Remember the old appraiser forum debates on tear down structure orders and out of compliance additions? If you don’t remember that, it was a big deal. Some jurisdictions had excess DIY build structures which were not code compliant. Reisdents kept adding and adding and ignoring setback limitations. And don’t you know it, some of those places this activity was prolific, they did indeed order tear down of structures en mass. This blew back during the housing crash when those properties eventually ended up in the hands of default property managers, aka reo. That sparked a new FNMA rule due to excess repurchase orders for this one topic matter. The updated rule was the ‘permitted addition rule’. Because, you know, legally built with permitting matters and is relevant to the valuation process.
https://selling-guide.fanniemae.com/Selling-Guide/Origination-thru-Closing/Subpart-B4-Underwriting-Property/Chapter-B4-1-Appraisal-Requirements/Section-B4-1-3-Appraisal-Report-Assessment/1032992541/B4-1-3-05-Improvements-Section-of-the-Appraisal-Report-09-02-2020.htm
The permitted addition rule language from the selling guide: Additions without Permits / If the appraiser identifies an addition(s) that does not have the required permit, the appraiser must comment on the quality and appearance of the work and its impact, if any, on the market value of the subject property. / me; I seem to recall that also saying the appraiser must comment if the structure does or does not have the ability to become permitted, and something with professional finish or it’s equivalent sort of language. That’s what I remember and still use. Again, emphasis on the local market.
We’ve got other conflicting guidance on this from days past. I found this Tom Horn doc from Appraisal Buzz.
https://appraisalbuzz.com/will-finished-basement-add-value-home/
Tom links to his own page which clearly agrees with ANSI standards. But also he has this one paragraph which I agree with and it is an important concept in comparability.
‘If it turns out that a particular split foyer home does not have any part under ground it still has to be considered as such because the split foyer comps that are being used most likely have an area that is underground and you want to compare the subject and sales on a like basis. It would not be appropriate to lump all the living area of one property together, including the basement level, but then compare it to another home where you have separated the above grade and lower level areas.
As long as the property being valued is being compared to all the sales in the same way you should still get the same estimate of value.’ / end copied portion.
Oh no, did I miss the ANSI FAQ line that specifically addresses how to deal with comparables, once I’ve complied with ANSI for my subject? That sort of was the point of a lot of my example posting, detailing example after example of how the counties do not parse the garden away from agla area, and how some counties like Adams specifically (5th most populous county in the state), how Adams does not even provide a ‘garden level’ reporting line or any online sketches and just lumps all size including garden into above grade reporting lines. Also I detailed the wildly varying nature of tri levels where their spacial attribution can be quite varied, the largest area could be garden, it could be mid, you never know. So you can’t just run a rule of thumb for comps reporting and cut a third off into the basement line and be done with it. Some bi levels have garage on the lower side and they can have garages which run full length front to back or the garage may terminate at the living room area, and that can happen for tri levels too. More impossible estimates if the same measurement and reporting standard has not been applied to comps as it has the subject under ANSI standards when no other reporting for other properties reflects ANSI standards. Many bi levels have bump outs on the front/and or rear, so that’s another measurement estimate variable which can run the entire length or like half length, front and/or rear, and can be anywhere from a half foot bump out to 2.5 ft. Tri’s same thing, bump outs are common (bump out meaning the upper portion is slightly longer and goes over the lower level, so you get that building overhang approach, they did that to maximize agla area over smaller foundations).
I’m not being an advocate for anyone. I am reporting these properties as they actually exist. I am in compliance with local jurisdiction, so are all the other agents whom follow assessment reporting. I match as Tom says in his article; you want to compare the subject and sales on a like basis. It would not be appropriate to. / Riddle me this riddle me that, how does one provide like basis comparisons in Adams county when we don’t know the specific volume of below grade sizing for our comps? My crystal ball is glowing that someone will say; just look at the 2 page full broker listing with all the dimensions stated. If only it was that simple, agents can enter that off the cuff because they’re required to fill those lines, if they’re not guessing at it they may be just running simplistic interior measurements and estimates to accomplish that data fill for room dimensions, if not just copying any data source they can get their hands on, such minutia in listings is often entered by non licensed assistants. So we don’t have online assessor sketches. We don’t have garden level size breakdowns. We are supposed to provide comparisons in a likewise manner.
We got problems.
Also just a helpful note on the sort of jumbling of response posting, yeah that’s tough to manage. Which is why just copy your statement, refresh the page, post it anew at the bottom. Once you recognize the posting line gets sort of thin appearing on the page, you’re into the responding to a response area and your response may not land where intended. Best to just jump to a fresh post rather than responding to anyone else, fyi. Thanks for sticking around, I thought this was over. But then suddenly I was incompetent and sneaky or something, ‘getting away with it for all these years.’ Oh please. You guys are talking about throwing the baby out with the bathwater. Either we’re all doing it wrong, we’re all doing it right, local jurisdiction matters or it does not, competency in locational standards matter or they do not, etc, etc, etc yada yada.
Lets talk about FNMA & ANSI. What statements would be true for both of these organizations at the same time: Neither is actually a builder. Neither has jurisdiction over local municipalities. Neither provides valuation services. Neither provides realty services. Neither is a qualified architect. Neither has authority over state regulatory bodies. etc, etc, etc. Colorado appraisers are not knocking at your door demanding you adopt our methods. We would simply appreciate the same respect. One size does not fit all.
Want to talk mountain out of a mole hill, talk about unnecessary complexity for something which until april fools day was very straight forward and easy to manage. Act like I’m a cave man living in the woods or something here, give me a break. I’ve got your heart attack right here, this is hilarious, the apparent inability to respect other peoples local customs, vainly reaching for justification why you think it’s acceptable to push other people around. Lot’s of that going around lately. Tell you what, I’ll totally go with the ANSI program, the very minute the assessors and local realty agents and the other GSE’s get on board too. I’ll do it immediately like right then and there. And I can already comply for ranches and 2’s like today because these same issues do not exist. However, rewriting assessment, permitting, building, zoning and coding documents for an entire state regarding bi and split level housing, retroactively adapting all previous and current MLS records to be ANSI compliant could take a while. BRB, hang tough, we’ll get there, eventually. (department store on hold music) Additionally, I can neither confirm nor deny I have ever completed ‘an appraisal’.
“Tom, per the no attributable room count comment. Sure, we are in agreement that data scooting is an effective work around for this.”
It’s not a work around. It’s reality.
The rest was TLDR. I can’t even understand if you answered my question. I think you are saying you agree with me that if you report reality per ANSI, no rooms will become ‘lost’.
That then allows one to place the comparable data in alignment and make any necessary adjustments for valuable market related differences.
Pretty easy. Clear as a bell. Everybody is happy. Any person with basic reading comprehension skills can follow it.
It’s a head scratching moment because the UAD formatting will read with no room counts, even though there is attributable size in the finished basement line. That’s a specific internal appraisal software review warning point, by the way. I appreciate that particular warning, it reminds me that even if I’ve entered finished basement room size, I forgot to enter my finished basement room count. Tech people drew that review coorelation because it’s logical. If the room counts are in the basement, the room counts should appear in the basement. If those room counts are in the top agla lines, then those room counts should appear in that line. Just because the total room count is still present does not answer the logical question of why the data was parsed. Despite popular belief on the matter, individual borrowing customers and their agents do sometimes actually take the time to read appraisal reports and try to figure out all the details. Now why did the appraiser report size on two different lines but reported all the room counts only on one line… Curious. It’s like looking under the hood for the turn signal. The turn signal is in the cab, not under the hood. Everyone knows that. Basement rooms are in the basement, basement rooms are not upstairs. Logic fail.
“What are you doing on a blog site if you don’t enjoy conversation and reading? /”
What are you doing suggesting what I should and should not be doing with regard to what I read and what forums I choose to participate in?
BTW, I was an admin for 7 years as a volunteer on a very high profile forum that is still running strong. It was basically a teaching / learning site with an International user base. I had no problem understanding and communicating.
Just because you can continue to type lengthy pondering doesn’t mean I must continue to partake in it. Re-posting it, seriously?
So the “meme guy” in this thread is going to tell me this…. “That’s right up there with emoticons.” — Yeah, right back at you.
Have a good one. I’m quite certain that you can continue to scour the Internet about classes, trends, blog posts, conundrums, stumbling blocks, and all manner of static simply because you can and also because you are pissed off at FNMA.
We all get where you are coming from. Tried to show you some easy concepts to use that we have used forever. You seem to not want to acknowledge it. Fine. Rock on and good luck in dealing with FNMA in your world.
Oh come on now. I had edited that before you even responded. Just having fun. TLDNR is just a pet peeve like people whom rush to post first with some qualifier they did not take the time to read. That’s not what you are doing so I edited that within like a minute, don’t worry.
The workaround solutions are not why I’m here. We’ve all got our skill sets and tool boxes.
What I’m hoping to express and relay is how the imposed non negotiable mandate does more harm than good and how one size does not fit all can be positively proved as creating more confusion than it seeks to solve. Logic tests are important. People at times can get too comfortable with work arounds but those may not make sense to others. Local jurisdiction matters. Relaying transparent easy to understand data is a strength of the appraisal community at large. Utilizing work arounds should be a measure of last resport not the standard process. And we learned new interesting facts about how there really is substantial tangible difference in the way different locations approach size recognition.
Does the CU risk rating applied to appraisals correlate with the number of warnings which may be associated with internal review?
I’m not mad at FNMA as a whole. But whomever pushed this certainly has earned the ire of many a thousand appraisers in this country. It’s not just me.
What’s wrong with fun image attachments? It’s important that even when debating and even possibly arguing, we all take a minute to enjoy our day and have levity. I’m not mad at the moment, give me a minute I’ll get there again if needed.
Just a quick follow up here since there was a lot of content there.
We learned something new with this latest round of research into above grade below grade definition.
We learned that in some jurisdictions, the above grade or below grade earth level is not the whole story. It’s not just up down, but also side to side considerations. We learned that some jurisdictions also consider the volume of perimeter above grade as a defining factor for what constitutes basement vs above grade (aka garden level.)
This is an important point which brings further clarity to the confusion here. These bi’s and tri’s from that age period always have a minimum size requirement and that size requirement caused them to become in alignment with minimum partially above grade perimiter minimum distance requirements, so they could the garden level space could be called ‘floor level’.
Adams is not clear on above grade below grade but rather seems to have instituted their own zoning and coding work around where they qualified floor area vs basement area, on both height in relationship to grade, and perimiter volume in relationship to grade.
Question; Did ANSI consider anything to do with perimiter when defining above/below grade?
__________________
Please, play nice. We’re all in this together. These are valid questions and do not equate to complaining for complaining sake. Many valid points here have been made which play to either side.
This is a point I may not be aware of. Does the appraisal industry recognize a singular source for language definition?
“Question; Did ANSI consider anything to do with perimiter when defining above/below grade?”
Yes they did.
In the actual STANDARD
2.5
3.6
In the ANNEX
Figure 5
Why is everyone trying to make me buy this book?
I’m having a hard time telling the difference between a GSE, an appraiser, and a book salesman.
The question was posed to specifically identify if any volume of perimeter garden level may supersede the apparent hard line requirement to report all garden as below grade.
I could phone a friend but will regrettably need to buy this book. That will probably be my very first book purchase under duress and threat of force in my entire life. I want a used second hand copy!
“I’m having a hard time telling the difference between a GSE, an appraiser, and a book salesman.
You are having a hard time with a lot more than that.
“Tom links to his own page which clearly agrees with ANSI standards. But also he has this one paragraph which I agree with and it is an important concept in comparability.”
I would do exactly the opposite of what he did IF all those lower levels sold equally, be they in ground or not.
My reasoning. FNMA / ANSI asked for the true square footage of the SUBJECT.
So if my b-Level was all above ground at 200sf I would report that. Then I put my comps as all above ground and explain why AND that the market gives same value either way.
That way FNMA/ANSI gets the true square footage which is what they want. I might also include the breakdown of each comparable as to the inground area. Just so they are perfectly clear as to what they are dealing with.
If you do it his way FNMA ends up with a sketch that reflects TRUE but a grid that reflects altered square footage for the very piece of the puzzle that FNMA wants to have accurate to reality.
You still have to write narrative explaining it.
Thank you for the response Tom.
And…. We’re right back around to false net gross indicators and excess digital appraisal review warnings which are not necessary and counter productive to the intended functions of net/gross differential expressions. The net/gross indicators are intended to be expressions of similarity or dissimilarity, an important function of appraisal review for both human and automated systems alike. Not anymore!
4 bi levels. All the same size. Yet the subject has a different parsed size expression than the rest. Let’s review the EO warnings which will come with that; Failure to bracket gla of subject vs comparbles. Excess adjustment volume over 25%. There are no room counts in the basement, but the basement line appears to contain a size entry. These are familiar internal EO review warnings in Alamode software because until april fools, those were legitimately helpful alerts which helped appraisers keep review alerts down and FNMA CU risk identification scores low.
No, none of that will happen. It will be apples to apples across the board.
Subject Abv Grade BiLevel comped to below grade bi levels that sell for same.
Subject GLA is accurate per ANSI
Now the way you say agree with from the other guy. The results are the same but FNAM now gets a 50% wrong indication on the subject square footage.
So this is not to ANSI spec. It does not give FNMA what they are looking for. Two appraisers could do this two different ways but only one way is correct to ANSI.
Same results so I say he is doing it opposite to what FNMA and ANSI want.
His thinking is correct for apples to apples comparisons but his reporting of the comps is backwards with regard to why FNMA wants ANSI compliant square footage.
Either way, no rooms disappear and none of those errors occur. Plus as to bracketing. When you have three perfect comps bracketing takes a second chair.
Sure, understood.
My worries. Grid picture post.
A bi lvl subject ansi compliant, all comps entered as they read from MLS and verifiable assessors data, not ANSI.
I made the actual basement vs garden level adjust in a lower line by entering only an adjustable amount in the finished line but left unfinished blank.
Am I missing something? We should have gone through this exercise earlier. Good idea.
How is your first photo of all at 2,000 gla ansi compliant when that lower bi level garden level is supposed to be reported in the bas line?
Jeeze Louise….. shakes head…..
Dude…. you made a post about a guy named Tom Horn!!
This is what you wrote……..
“We’ve got other conflicting guidance on this from days past. I found this Tom Horn doc from Appraisal Buzz.
https://appraisalbuzz.com/will-finished-basement-add-value-home/
Tom links to his own page which clearly agrees with ANSI standards. But also he has this one paragraph which I agree with and it is an important concept in comparability.
‘If it turns out that a particular split foyer home does not have any part under ground it still has to be considered as such because the split foyer comps that are being used most likely have an area that is underground and you want to compare the subject and sales on a like basis. It would not be appropriate to lump all the living area of one property together, including the basement level, but then compare it to another home where you have separated the above grade and lower level areas.
As long as the property being valued is being compared to all the sales in the same way you should still get the same estimate of value.’ / end copied portion.”
The paragraph you said you agree with states…..
“If it turns out that a particular split foyer home does not have any part under ground”
We are talking about an ALL ABOVE GROUND BI_LEVEL DWELLING.
ALL COMPS ARE BELOW GROUND.
He say to compare the subject as though below ground. I say NO do it just teh opposite. THAT WAY …. FNMA will get an ANSI compliant SQUARE FOOT FIGURE FOR THE ****SUBJECT**** !!!!!
His way they WILL NOT.
EITHER WAY…. the value result is the same so just do it the way that reflects ANSI and gives FNMA what they want.
=========
Oh, and I’ll ask one more time… In your graphic… why no room count posted for sq ft. below grade?
Well hopefully I do not have a foot in mouth moment here. We really should have gone through this exercise earlier. I don’t think so though and these are complex considerations so why not some illustrative examples, a great idea.
My mention of tom and his guidance has nothing to do with what I posted. I’ve been droning on about the difficulties which come with disqualifying ‘market recognized agla space’, and scooting that to basement instead, since about the beginning here. Even if I wanted to use toms ‘like basis’ method I could not in Adams, because there is no definitive reliable source to inform me what their garden level space is, so I could scoot that to the basement line instead.
Your first grid photo is not ansi compliant because it reports below grade area in the same line as above grade areas. It is my understanding ANSI causes the need for all lower bi level areas to be reported in a different line. Correct? Y/N? ANSI FAQ #8 really points to the working operational approach where due to above/ below grade identification, that can and does change the above grade reporting numerical figures actual amount (scoot that size amount to basement instead).
Q8. The ANSI standard specifically notes that the definition of above and below grade could cause some houses to have no above-grade finished square footage. How should appraisers report GLA in this scenario?Properties for which the entire square footage is below grade (such as berm homes) would be eligible for the exception process described in Q6.
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.
On to the basement room reporting:
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.
One can not juggle room entry adjusts (I don’t think, never tried it) juggled between pg 1 improvements section and room count section on pg 2 the appraisal grid. Because the room count figures entered in the improvements section automatically transfer to the above grade room counts in the grid as that’s a software feature. This is what I’m on about. I could just add more juggled room count adjusts and do it this way instead. Second photo attachment. Sadly, this drives gross adjustment basis even higher. How does one comply with ANSI FAQ 16, and not at least have the subject with the all zero’s room count entry in the basement lines? I see what you’re saying, I would not want to use all zero’s for comps bas room counts, but how does one comply with FAQ 16 and have any below grade room counts for the subject?
Look at the gross adjustment continue to fly with juggled adjusts! That is not an honest expression of these homes base similarity and matching size.
Also, sorry, I’m unfamiliar with the juggling scooting method. By moving the room counts to the basement, then still applying a total room count adjust in agla, I have an imbalanced adjust when it should be mirrored. Above grade room count to 12k, bas only at 10, ideally those should be evenly balanced if all we’re doing is cutting out only to add back in on another line. This is a lot more complicated than just reporting them all as 2k agla across the board with a 0%/0% net/gross adjust indicator and no room adjusts.
Here… let’s take his post and I will make a small edit…..
‘If it turns out that a particular split foyer home does not have any part under ground (edit by me edit by me edit by me ) the split foyer comps that are being used most likely have an area that is underground and you want to compare the subject and sales on a like basis. ( EDIT 2EDIT 2 )
As long as the property being valued is being compared to all the sales in the same way you should still get the same estimate of value.’
(edit 1 )
“it still has to be considered as such because”
No it doesn’t the same results can be achieved by altering the comparables to align to the subject rather than the subject to the comparables.
Edit2
” It would not be appropriate to lump all the living area of one property together, including the basement level, but then compare it to another home where you have separated the above grade and lower level areas.”
This makes no sense in context of an ALL ABOVE GROUND BI-LEVEL. Both of descriptions mention a basement. The statement is true. You don’t report and compare one property and include basement in GLA and then the other you break it out. But that is not the context of his scenario. His context is 4 homes all of the same design Bi-Level but your subject is ALL ABOVE GROUND. NO BASEMENT.
He states to align his subject to the comps for comparison. I say align your comps to the subject to be ANSI and FNMA compliant.
Your pretext was that he was fully ANSI compliant or something similar.
I’m not knocking the guy. I don’t know him. I totally get what he’s saying but he can do exactly the opposite of what he said and satisfy what FNMA is seeking.
His valuation and reporting idea is sound and expected but reversing the alteration will maintain ANSI and FNMA.
Stay on my page for this one.
All bi levels we deal with in CO have partially below grade area. If they’re all the way above ground level, they are 2 stories not bi levels in most scenarios.
Therefore ANSI FAQ on how to deal with disqualified above grade areas applies.
a Bi-Level is not dis qualified Above Ground GLA.
It’s a combination of Below Grade and Above Grade. All qualified under ANSI.
Your GIRD…..
Here is what I see wrong.
Subject.
I am assuming the 2.1 baths are not all above grade. Maybe the same for the room count. Those numbers in GLA should only reflect ABOVE GRADE. Move other rooms numbers to below grade.
Comp1 the way it is written it should be a 2000 Bi that is completely above grade.
To compare apples to apples. move the lower level to the basement line as well the associated room count. This is to align to the subject. Tell your client whay you are doing this and that the areas sell for same price.
Comps 2 and 3 missing room counts below grade and may need to have them removed from above ground GLA as well.
Comp 3 extra basement – perfectly clear
Tom B, your second grid image post not compliant with ANSI FAQ 16 in Colorado. Because you did not keep room counts in the improvements section which then auto transfer the rooms to the above grade room count, rendering the basement with zero room counts.
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.
“Tom B, your second grid image post not compliant with ANSI ”
I know!!!! We are talkingg about an ALL ABOVE GROUND BI-LEVEL.
That’s why I say DO NOT do it that way.
I don’t think you understand what Q16 is speaking to.
It is speaking to areas such as less that 5′ ceilings but maybe there is a wine cooler built into an alcove or room that doesn’t fit the 7′ 5′ deal. It’s a finished area but does not quality for GLA. So you put it on a different line.
Wine Cooler Den —— +$30,000
Ok I think we are at a Waterloo here.
1st “they want to get rid of us”…because they want to keep the fee they pay us.
The proof of that is the new Hybrid. No ANSI there , No appraiser inspection and a Lacki to do the photos. Far less concern over accuracy or regulation or standards in those. CORRECT?
So how is that more reliable and uniform than even the old non standard AMS that was used by some?
Since they will be using non licensed people for a good portion of these there is less uniformity IMO. Correct?
So can we agree they do not want to get rid of us because of our lack of uniformity?
Second I stated in my first few posts here by saying IMO that there can not be a standardized measurement system and uniformity if everyone involved is not on the same page. Do we agree on that or not?
The important issue that seems to be the point of contention here is “usual and customary or public(market) acceptance. ” I am not the Author of any book and did not do a single thing to contribute to the development of the USPAP standards or any of the AI’s decisions on anything. I do however read. I see market acceptance as part of the appraisal principles and practices all the time. I also see market adjustments a lot as well. I also see the definition of Market value includes the words BUYER AND SELLER. Why do WE make “MARKET ADJUSTMENTS” Where do they come from? I could go on and on but I think we all get the point Correct?
Is it the consideration of these market issues or public acceptance and understanding we are not in agreement with Correct?
Can we explore that for a minute?
We know that the reporting requirements of USPAP require us to report the appraisal in a way that the reader can clearly understand. I am pretty sure this includes the person who pays for the report …Do we agree on that?
Now I just got word back that a home owners feels I did not measure his home correctly . Now just so we are clear here I do and have used all ANSI methods to measure. I also explain the method in the report and label the sketch as well for open area and all else as stipulated in ANSI. This home was reported by the Auditors as 3200 sq ft and by the Realtor as 3400 sq foot. My measurements 2700 sf ft of GLA. I removed the open areas of the open to below as required, the 2 story great room area as required and all else as required. So yes I was accurate. The problem is no one else thinks so. Not the Auditor, nor the Realtor and NOT the home owner. Is that my fault or is it because non of these people use or understand the ANSI method requirements for accuracy? Now even though I know I am right here according to the standard method ANSI uses I still now have to get an attorney and answer the law suit that will be placed against me. Now my E&O will go through the roof even thought this will be dismissed or thrown out cause that’s what happens with E&O. So yes I know I am right but because the public and all others involved in the process are not familiar with and do not use and have not used the ANSI method I am now dealing with a mess. But I know my GLA is right!! (Now we will see if the lender gets named too and how they will react.)
So my point is if we use a uniform method that the Public does not understand or except, the Realtors do not use and the Auditor’s are not required to report are we going to say accuracy is all that counts?
For us the answer is yes of course. “We are right and everyone else is wrong.”
DO WE AGREE ON THAT?
But according to everything we (at least I ) have been taught, we also know that public perception and “Market Acceptance ” is considered as influential or as having weight in the process. Why else is there a public exposure time for USPAP changes? Really do you think the public form is like SOLD out when it occurs, standing room only”?
Now the truth is if you showed USPAP to 100 people maybe 10+/- would understand all of it. So for USPAP it is not important that they (the public) understands all of it . it is to give the public a chance to agree or object to the additions or retirements of the standards and to learn what that means to them. Why do we do that?
There’s a lot of information (History as well) that tells us that the lenders tend to do things that are adverse to consumers. That’s why there are old and new disclosures. closing statements and rights of rescission and all the other100’s of rules disclosing policy, procedures, costs, methods etc. Cause the public won the right to have these things because lenders were too ambiguous.
Do we agree on that?
Do we use the metric system here? What temperature scale do we use? Why? We know the universal systems are metric for all measures. That is the most reliable and universal standard Correct? It’s been around for a long… long time CORRECT ? So why don’t we use it?
Do you think it has anything to do with the percentage of the public that does not use it, were not educated in it and really just don’t get it and DO NOT ACCEPT ITS USE! So what’s the big deal just use it. it does not change anything either its an accurate measurement and it is internationally accepted.
IMO This is not the proper time and the proper way to just “make a change” without consideration and reviews of those it involves… for so many that have not had the time, education and acceptance, who will not react to it in any form of acceptance, we need to get ahead of the problems …we should clearly teach everyone before we simply do it. While “we know we are smarter than they are” that will not end the problems this new standard will create for us.
Even a simple pamphlet on the ANSI measurements explained that is handed out at the loan application process will help. Heck LOs don’t even tell borrowers that Appraisers have to come inside and take pictures. I get questioned all the time about why the LO did not tell them that! All borrowers ask me for a copy of the appraisal and many call me and ask me what value I arrived at. So PLEASE don’t act like it does not matter what the public thinks, wants, needs or expects.
No one tells the Realtors not to intimidate or harass the appraiser. No one teaches/learns or cares about the other person’s job, responsibility, or the process as long as its “not their JOB”
The metric system is a fairly good example and I have not heard even one person here say we should all just start using that for an even greater INTERNATIONAL consistent method.
I simply believe for uniformity and accuracy it has to be a standard for everyone in the field or any fields relating to Real Estate. Right now the URAR forms are not properly formatted for these lender required gridded areas. IMO.
There are not enough lines in the grids to have pools, out buildings, other amenities AND the grids needed for this system. That will take time to implement, and it has to be uniform to be able to be considered by the people we are using it for/on. JMO
Right now QC is not ready either. Or they would not be asking for revisions when the Auditor’s card does not match the appraiser’s measurements.
So I guess we all have opinions. Are we considering ALL the angles and all the perspectives and all the people or just the one we ourselves see as “no problem here” “What’s the big deal??”Well it could be much more than you are considering!
It is interesting to know that North Carolina does not use ANSI and their appraisers will not be using it either according to the ANSI BOOK now published per one of the States appraisers. Well if it is to establish uniformity then how can some States “opt out” ? and WHY ??. Evidently a lot of people don’t agree with this FNMA idea.
Now are we getting a tiny bit more understanding of some of the concern, confusion or dismay with this situation that a few (or maybe a lot of people ) have? If not I really do not know any way anyone could break it done more clearly. It is just not as simple as it seems.
Holy smokes BA! You just blew my mind all over again. HLA. Heated living area. Never heard that one before although we do run across the good old must have one heat duct and be insulated for add on areas to be qualifiable gla, and the space must pass the unpermitted addition test of being heated, insulated, finished to a professional standard, and be able to become permitted if needed, if the space is not officially on the assessment record.
Found this. https://bulletins.ncrec.gov/ncrec-residential-square-footage-guidelines-vs-ansi-standard/
You’ve introduced a new concept to me. HLA. Is that why there is an apparent confusion with counting open areas?
This post, https://appraisersblogs.com/ansi-measuring-standard-required-by-fannie-mae-in-2022/#comment-33237
Do some appraisers really count the open area!? The hell? Looks like I’m sort of ANSI compliant already. Hope remains, ha! Who counts open space in the GLA line? That is more offensive and misleading than fictitiously reporting agla in the basement line to comply with ansi. I have never once in my life seen a realty agent report open space in their size listings either. Assessors always cut those areas out too.
LOL…. that was a typo. I meant GLA.
HLA is an OLD term not used so much anymore to my knowledge.
But you are right heat and finish were required to consider it in GLA in attics.
As to WHO counts open foyers, 2 story great rooms in GLA?……
Realtors, Auditors and homeowners here do. I see it all the time.
The guy was sold the home with the open to below area counted in the GLA. The Auditor’s card also counted it. That’s why he thinks I measured wrong. The sources he relied on to buy the home 3 years ago had more GLA than I did.
The Realtors here NEVER cut out these areas. The Auditor’s card does now but they did not before they were required to get licensed about 7 years ago. The home was built in 97 before that.
Hi BA. If you had a typeo I missed it. The HLA reference was from some state regulatory update doc I posted a link to in your state. Defining space as heated area is problematic without additional qualifiers. Let’s start arguing if we should include closets and mud rooms, oh boy. Not a good approach.
That’s a real shame that agents and others can’t align with a uniform standard in your jurisdictions. And I can see a very clear need for a uniform standard applied in those situations. That’s where the functionality of the MLS members system comes in. MLS should define a standard and hold agents to it if there is that much variance, or at least give solid guidance. Our local MLS has penalties and denial of service clauses for agents if they purposefully cheat, use deceptive listing practices, do not update coming soon, available, under contract pending status, and closed status, in a limited time window like they have 5-7 days or less I think. MLS cleaned up our variable concessions reporting problems too, clearly defining what needs to be disclosed and what does not. Because DORA our regulatory agency issued guideline statements for those problems. If you have a problem with agents playing the field that way, write your regulatory agency and ask for a guideline clarification to be published. Then take that published item and demand the MLS group adhere. Problem solved. No FNMA or ANSI injection is necessary.
One ponders if in places like where I am at, that’s why they defined ‘floor area’, rather than ‘heated living area’, or ‘above grade’.
It’s like, dang, all this ‘grade and slope’ everywhere, defining all this different space is going to be complex and confusing. Let’s call everything garden and above grade as ‘floor space’ and reserve ‘basement’ for only 100% below grade. I LOVE THE WAY OUR ASSESSOR DOES IT! Agents like the methods too, we’re all on the same page! No confusion!
I’ve never ever seen a foyer counted as agla, except in a few rare cases of accidental issues where measurements were difficult, even then the correction for space amount was minor.
FNMA could have solved the problems like you deal with by simply writing into the selling guide; DO NOT COUNT FOYERS! It’s not rocket science. They did not need to shill for ANSI, become a book sales promoter, and impose non negotiable mandates across the entire country and ignore and go completely against local jurisdictional guidance already in existence to solve those simple recognition of space issues.
If only it was a perfect world where all builders everywhere and all assessors everywhere, and all agents and market participators everywhere, and all terrain and climate and water table issues everywhere, were all the same.
Let’s hold hands and sing the ANSI song! We are the world. We are the children. Everyone for a brighter day, let’s start buying this book. We are the world. ANSI is the only standard. Comply so you can keep working. Come on everyone join in! We are compliant. We are subservient. Come on and have a better day, just you and me and ANSI! Buy the book!
This third grid post. ANSI applied only to subject, but none of the comps.
Because that’s the real deal here in CO, in some counties we will have no information on what portion could be broke out for apples to apples comparisons where we’d scoot garden level to the basement line. Look at that gross adjustment pump up like a weight lifter before we’ve even applied one single relevant adjustment. Bear in mind all these units are marketable, are recorded with assessors office, and have value at the exact same size and price points, except for a little bi vs tri variance and an inconsequential unfinished basement on the 3rd comp. Additionally the expression for the subject is now falsified, because I’ve fictitiously reported market recognized above grade ‘qualifiable floor area’, in the basement line to comply with ANSI.
No, the subject data is actual fact and reproducible by any appraiser in the USA.
It’s only known fact.
If you can’t visually observer your comps, read assemnet records, read MLS, look at photos, amke phone calls to agents, etc.. and be able to break those sales down to similar ….. then just tell your client.
Screw the percentages. That’s life in the big city.
quote / “The subject data is an actual fact and reproducible by any appraiser in the USA.”
ONLY IF they actually traveled in person to measure the subject home personally. Because there is no other data source to attain this parsed out lower garden level size vs the total assessor reported size, as the assessors only report all qualifiable floor area in one single reporting line, puts only truly 100% below grade basements in the basement reporting line, the assessor does not parse out garden level, and there is no online sketch available either.
Screw the percentages!?!? I don’t feel like reposting the highly detailed commentary about how important the net/gross indicators are, how they are indicators of dissimilarity or similarity and why, how they can be used within the grid itself to extract market reactions for line adjustments, influence CU risk rating scores, affect client revision clarification and stipulation requests, provide reviewers simple easy tools to effectively judge an appraisers competency in comp selection and adjustment strategy, and were at the very heart of original FNMA 1004 form design as the most effective tool for both appraisers and reviewers before the age of automation. But that’s it in a nutshell. Discount the meaning of net/gross indicators at your own peril because it is the absolutely most effective point of defense available to any appraiser filling out the adjustment grid, it’s how you know your finger is on the pulse or if you missed the mark. In heated markets they also express the volatile nature of frenzied buyer activity if that sort of thing may be present, aka mismatching benchmarks to value. Additionally the net/gross adjustment indicator is something the laymen can and often does understand, the balance between net and gross is a concept which extends to just about every financial services industry out there and beyond.
“quote / “The subject data is an actual fact and reproducible by any appraiser in the USA.”
ONLY IF they actually traveled in person to measure the subject home personally. ”
I honestly didn’t think anything you posted would surprise me. What exactly do you think this thread is about. It’s about appraisers going to houses and measuring them to a standard.
WOW … that was a surprise.
I give up. This just feels too troll-like.
To clarify; In this third grid photo I’ve also complied with ANSI FAQ #16 which has rendered a zero room count for the subjects basement area.
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
To clarify again; All bi levels in the areas I deal with have a lower level which is partially above grade and below grade. Per ANSI this renders the lower half to be below grade or disqualified from above grade reporting and subsequently required to be reported in the basement line instead of remaining mingled with truly above grade upper level reporting. Which in turn then scoots actual basements for a 4 level property like a tri w/ bas, to their own line item area which will also require manual calculations and I’ll lose the benefit of efficient software support.
To clarify again; Our assessor where this subject and comps are located in Adams county. Where as per zoning coding building document reference I posted above, the assessor qualifies ‘all floor area’ as being attributable to a single reporting line which appraisers and realty agents around here just pop in and enter that matching size in the ‘above grade’ reporting line. Hence my call that if this ansi standard is to be applied, FNMA should pop in a third line grid adjustment line for garden level to account for these jurisdictional variances in size reporting and recognition.
Hopefully we can get on the same page here.
ANSI 3.7 Ceiling Height Requirements
AKA . How to determine if a room above grade such as the top level of a small Cape Cod is valid for GLA or as ANSI defines it … to be included in Finished Square Footage… It is Finished Space or a Finished Room but not necessarily Finished Square Footage = GLA
This is what FNMA Q16 applies to.
Below 5′ ceiling height NOT included.
7′ ceiling height required and must be 50% of entire room.
My example — Assume home is 30′ long.
7′ section = 3 x 30 = 90 sq ft
5′ section = 10 x 30 = 300 sq ft.
The 7′ section would need to be wider as it does meet the 50% rule. So now we have a finished room. We will call it a play room for the kids.
It is NOT included in GLA but IS included in room count. It can be valued on a different line.
This is what Q16 is trying to address. Not remotely associated with below grade issues. Contrary to what FNMA states, ANSI is actually very clear on this.
The 7? section would need to be wider as it does meet the 50% rule.
Sorry… does NOT meet …
“Hopefully we can get on the same page here.”
Dude… read Q16…. read the words…..
“Per ANSI this renders the lower half to be below grade”
AMEN BROTHER — the Lower Level is BELOW GRADE
Q16 –How should appraisers account for rooms located in ABOVE-GRADE finished areas.
If the LOWER LEVEL is BELOW GRADE it is NOT NOT NOT located in ABOVE-GRADE and therefore Q16 does not apply to reporting the lower level of a BI-LEVEL.
Read the words….. “ACCOUNT FOR ROOMS LOCATED ABOVE-GRADE”
The Lower Level of Bi-Level is NOT LOCATED ABOVE GRADE
It’s located BELOW GRADE and you measure it and report the Sq ft and room count as finished and unfinished as it may be.
This is more or less what you grid should look like. I’m not sure where all the rooms are located. Just making a reasonable guess.
Unfortunately in locations where we recognize ‘floor area’, (defined as everything not basement per our local jurisdictional guidance set forth by the county) as distinctly different from ‘basement’ (defined as 100% below grade), the grid will not read all clean like yours. Because we’ll be using different units of comparison and as demonstrated, we will be unable to attain the exact unit of comparison factors (the specific volume attributable to garden level), to have a matching unit of comparison.
If we do have the garden level break out parsed data, as some assessors have, we’ll now have to spend more time separating this data. The basement line becomes the garden level line, and we’ll need a new line for the actual true 100% below grade basement. Because… (drumroll…) Garden level tracks at the exact same value and price factor as above grade, while true 100% below grade basements track with a notably lower price value basis.
So we’re unable to co mingle the garden and basement in the basement line. Because in our markets, per the jurisdictional guidance here, garden is recognized as floor area which is acceptable to include alongside agla. The market agrees, participators buyers sellers agents and others pay the same amount regardless of specific type or how much garden there is or is not present. True basements as defined in our local jurisdictions track at a lower basis, often a half if finished or less if not finished.
This value factor appears to be different in other jurisdictions, so in some areas it may be acceptable to co mingle the garden and basement in the basement 1004 line, because a similar adjustment basis will be present. In Colorado that similar basis for adjustment is not present. So in order to comply with ANSI FAQ #17, we have to engage in a fictitious reporting strategy in the literal sense, because we’re hijacking the basement line for garden, and putting actual basements in another line. I know you’ll say, ‘but it IS A Basement’, and I get that, where you are at gardens are basements. Where we are at they are not basements. There is conflicting definition and I proved that in links and copied definition statements too. Who is the ultimate authority on definition for the appraisal industry. A singular source or a variety of them? Whom guides the local market standards, the local jurisdictional authority or those far away without jurisdiction? How do people perceive the competency of the appraiser when the appraiser utilizes standards NOT set forth by the local jurisdiction?
Here, we’ll do it your way, recognizing the literal as being below grade. You have something there, I agree. That does solve the no attributable room count dilemma, but it comes with a price.
WOW! Now we have a 40% gross before we’ve even applied any meaningful adjustments anywhere else.
And who needs those lower line items for other important data factors? I’ll just waste those trying to be somewhat clear about methodology.
This is misleading reporting right off the bat. Expressions of real property in the appraisal grid which are contrary to local standards. Increased warnings and risk score as well. Welcome to appraiser incompetency in 2022. And this is a simple situation, I can line that up with a tri w/ bas vs ranch w/ unfin bas, a 2 on slab and a bi level if you’d like. The grid will be a mess and some examples I would think would start with an even higher gross adjustment amount. You know realty agents use net/gross in bpo’s too. Why don’t they hold to the ANSI standard so we could all be on the same page? Why don’t the assessors? Because those are not OUR LOCAL market standards. In CO, ANSI exists only in the mind of the appraiser and nowhere else.
Q17. When the ANSI standard excludes finished areas, resulting in a smaller GLA, does this adversely affect the value of the property? No. The ANSI standard defines a transparent, professional approach to describing the subject, which gives appraisers a consistent starting point for the valuation analysis, but it says nothing about how appraisers conduct that analysis. Done correctly, adherence to the ANSI standard does not change the value of the property.
Sorry, I slipped up with the data scooting and improperly reported true basement in the garden line.
This is the corrected version. The tri level w/ basement has the basement completely separated from the garden level line now.
It’s too easy to slip up with data scooting.
This is what it should look like…. I’ll post the Side by side view next.
Now the Side by Side where you can make all your adjustments.
Tom I get that. I’m not dense nor feigning ignorance. But you are not taking a minute to recognize the problem. We do not have the data available to separate the garden level space, not here in my own back yard of Adams county we do not have that data. I clearly described the appraisal problem and clearly described the assessors approach to size recognition, and even posted the actual Adams assessors building permitting document so anyone can see this is truthful information. Adams recognizes ‘floor space’ (the totality of all agla and garden level in one lump figure), and also recognizes ‘basement’ (specifically defined in this jurisdiction as being 100% below grade.) Adams qualifies garden level as being acceptable to call as floor space, due to perimeter requirements of a certain size.
Here is your daily pepsi challenge. I just used google maps to find one of the thousands and hundreds of thousands of bi’s and tri’s in my area, specifically Adams county. I picked one randomly.
Here is the assessors page for this property.
https://gisapp.adcogov.org/quicksearch/doreport.aspx?pid=0172107202009
Here is the zillow page.
https://www.zillow.com/homes/11172-dexter-drive,-thornton_rb/13004152_zpid/
The address is 11172 Dexter Dr, Thornton.
Can you please tell me what the garden level portion is? So I can fill the grid out as you suggest?
Go ahead, google that puppy, check out the assessors record. There is no recent MLS records on file.
Just run that single property as a comp in your grid. Show me how you are going to identify the garden level spacial amount. I’ll wait.
Actually you don’t need to go through the exercise because I’ll save you time. The assessor reports the lower garden level as ‘floor space’ and includes that right alongside the mid and upper levels of this tri level house, in one lump sum number. There is no online sketch to access. There is no basement reporting line.
Which takes us to the inevitable conclusion, we’ll have to include all that size data in the agla line, because there is no other way to parse the garden level out other than a straight up guess. Think you can competently estimate the bump out distance of the third level overhang? Can you tell me if there is a rear bump out there? Tell me the size dimensions of the garden, mid, and upper level.
Again, we will only be able to apply the ansi standard to our subject in many of these scenarios and locations, because the ansi standard exists only in the appraisers mind and nowhere else. This will result in climbing gross adjustment indicators when our subject is ansi compliant, but our comps are not. Technically if this was a comp it would have an mls sales record. There would be some room dimensions there in the full 2 page mls broker listing. But those size dimensions would not be reliable or accurate, they could be off the cuff estimates, entered by an assistant, copied from another tri level which may have some design variance, they may not include other garden level space which is common such as a little hallway or a half bath which are commonly included on the lowest tri level space designs. Did the agent include or exclude stairs if they actually did measure? The measurement estimates for room dimensions on MLS could be interior based they could be exterior based, we would not know. Agents may find a way to skip that data entry portion. Agents are not required to have sketches, all the agent requirement is, to copy the assessors record for stated size into their listing. The MLS record will not contain a different ppsf metric indicator for agla vs garden.
Bear in mind that tri level competes evenly with a bi level of it’s same size, and they sell at an equivalent price. So even if you could get the data for this bi and tri, by applying an ansi standard when that standard is not applied in this county or this state, you’d start off with net/gross indicators which climb upward before any actual market reaction adjustments are applied. Because there is no market reaction to the garden level when compared against above grade space. Then toss in that same tri level, but another example with a basement 100% below grade for four total levels. You can not co mingle your basement adjusts because they need adjusted at a different basis, therefor morphing the 1004 basement line into the garden level line, and requiring the appraiser to scoot the actual 100% below grade market recognized basement into it’s own line item. You lose the benefit of auto calculation tools in the side by side view. It’s a disaster no matter how you slice it because the adjustment value basis for garden is the exact same as for all other agla areas, and the basement adjusts at a half or less rate.
The broken record skips on.
No, I totally get. That’s why I say. Just don;t adopt ANSI. It’s not for you. Don’t do it.
I got it the first time you posted it. The 20 repeats don’t make it any clearer.
You have to admit though that the link you posted would not be comparable as it is not a sale.
If it were a sale you would better data. Be able to call a real estate agent and —maybe– be able to get better data or maybe not.
But either way seriously… Don’t adopt ANSI, it’s just not for you. I don’t think you are able to reason your way through it.
Forget ANSI and rock on.
Tom, Do you support the ability for appraisers to use the GXX001 exception code for bi’s and tri’s in locations where the assessor does not provide clear enough data to get a garden level break down?
How exactly is a sales agent going to give me any more data after a property has closed and the deal is finished? What will a phone call to the agent reveal? There is no better data with a sale, other than a coincidental factor if the agent paid for sketch services to run along their listing, which that is a rare treat and 19 out of 20 times, no sketch in the listing. Otherwise the MLS listing provides photos, descriptive detail, and all property size data is copied from the assessor with automatic assessor data import tools the local MLS provides, and the agent may estimate room dimension entries if those are even present. We have really great consistency across the entire data spectrum for size, from assessor to mls to appraisal (pre april fools day), all of our total floor area and basement area size data matched no matter which professional you turned to. Not anymore.
It does not seem like you have a good handle on this, as you keep posting grid photos which assume the appraiser can achieve a comprehensive break down of garden level space in Adams county. Which the garden level size data is not available in assessment records online or any other easily accessible verification source in Adams county. I guess people think it’s fair for Adams county appraisers to have to go back in time, always go to the county seat, pay for paper records, try to ask for sketches. You know what those sketches may often read like though; The mid and lower level are one big rectangle, and then a third shape area for the third level as it has a bump out and is wider. Even with the county sketch I could end up still needing to guess at where the garden ends and the mid level begins. I have seen that very sketch before.
Your statement I’m not able to reason my way through this, that is an unnecessary statement. You’re talking to me about reasoning skills while dismissing the value of net/gross indicators. Disregarding the plain fact that in Adams county, garden level is not parsed away from other agla area. What if I am using a FSBO private sale where all I have is the assessment record?
You’re right about ANSI not being a good fit for me. It was not a good fit for any of our thousand assessor employees, any of the tens of thousands of realty agents whom operate in this state, or our dozen local MLS groups. Which is why they do not use ANSI standards. We agree on that point. A hard line ANSI standard changes the game for everyone in Colorado.
We do not have a choice but to adopt ANSI though, unless someone at FNMA comes to their senses and releases the mandated aspect of this. So no, ‘not adopting’ ANSI is not an option. But it was important and meaningful to illustrate here all the problems and confusion this ANSI hardline rule brings forth. In some areas this is a workable standard. In other areas it is not. Also illustrating the importance of voluntary engagements. Central planners do not always know what is best for everyone else.
If you are using the same style house with the same general build style why would anyone have a problem determining the similar basement/lower level areas. Are you using colonials/Georgians to compare to split levels?
Great question. Tri levels have so many design variances, so do bi’s. The garage can run front to back, or terminate with a living room behind. At times the garage has living area above a portion of the garage rear area where garage is set in front of living areas, but other times garage cleanly on the side. Sometimes in a bi the garage can be built into the lower level, so it functions more similarly to a tri level or like a 2 story with a half sized bottom level, other times the garage is all the way to the side of the unit and you get a perfect up/down size balance. They can be long rectangles or more like big squares. Some tri’s may have little hallways on the garden level leading to garage door and some have a half bath or full bath on the garden, others not. Some tri’s have perfect matching garden and third level, other times they cut into other space or run the upper over the garage a little extra for the upper level w/ bump outs, and they’re not evenly balanced. Other tri’s are more utilitarian with just a living room and garage on the lower level. Due to terrain variety and sloping challenges some tri’s have the rear sliding or french door sets on the mid level coming out of the dining, some on the lower level. Some bi’s have upper level bump outs and that can be front rear or both or not at all. There is just so many variances in design, one needs an assessor sketch or to measure in person to have a solid handle on spacial break down. Sometimes in the exact same neighborhood you can have a tri w/ bas where all 3 finished areas are above ground, but it’s competing counter part has the lower tri level as garden partially below. This is why our standards are the way they are, to present fair size recognition balance with functional livable space given our constant design differences which were necessary to build with fluctuating water tables on uneven land.
And again, not all assessors parse the garden level size. Adams county does not, that’s a fact. Because we use a ‘floor plan area’ approach. In the Adams zoning coding documents they qualify garden level as being acceptable to lump into the floor plan area for one singular space figure, and only report something as a basement if it’s 100% below grade. Most assessors operated that way but lately some have tried to parse the garden level out for more spacial break down. They may apply this to the record retroactively so they don’t always get it right and you’ll have confusing data like multiple levels all noted as the same level when they’re really not. It comes down to just a person at the assessment office trying to clear though so many paper based sketch records a day, scan those in, update the online data record. Most assessors went online mid 90’s to early 2000’s in CO, but some still struggle to get everything online. Some provide sketches, some do not. It was probably a manpower and budgetary consideration if they committed the effort to do that.
I’m not sure what a colonial or georgian is, I don’t think we have those around here, at least not many. Colorado had prolific housing expansion post ww2 era. I just googled those. Boy those would be easy to measure! I think we have georgian imitations, they’re like special order but appear amid tract housing infrequently, with matching space compared to others so they’re like georgian mini’s if I had to guess at some descriptive. I viewed a photo of one with a really sloping roof, I imagine that cuts into interior spaces somehow, that would be a good example of where an ANSI standard for height would be a good application.
https://www.homestratosphere.com/colonial-houses/
Wow! Are those residential houses? It appears so. What the heck with ‘salt box’ style? They all look like some dixieland mansion or something, if I’m using proper terminology, I do not know. We don’t have those around here in the high altitude areas.
It’s pretty straight forward with the majority of housing stock here in Colorado, we only have a small body of pre 1950’s housing stock and most of that is in the urban areas, or the occasional pioneer farm home which still stands although it’s land size is likely reduced as suburbia building encroached on the areas. And we have nutty A frames in the mountains, let me find a photo of one of those for you. ‘The gnome home’. That’s not what they’re really called, they’re A frames. They sell them like prefab kits and such to this day. But the old ones were even more slope like little skinny gnome hats. They did that due to very harsh high altitude conditions with incredible snow loads which can be dry snow or wet snow which can exponentially increase the snow’s weight. To prevent roofs from caving in they have extreme slope roof and front overhang eves so snow stays off the front door and slides down the side. Modern ones have metal roofs so the snow can slide. It’s a hazard for large structures in the mountain because when that snow releases it all comes down at once and you can get crushed, so they may build them higher and the eve wider to go past the structure quite a bit. In some areas you can get truly ‘snowed in’.
Then we have luxury mountain stock down to silly tiny old one room cabins. Mountain is a completely different ball game than suburbia. Most populated suburban areas are just modern or semi modern tract houses, ranches, 2’s, bi’s, tri’s. There are a few classic victorians in Boulder and some Tudor and classic Craftsman houses in Denver. Those Craftsman houses are something else, wish they’d still build them like that. Every one of them has a glorious huge front covered porch elevated, round about design function, high ceilings. Their down side is cramped basement space often 6 ft, sometimes 5. Those are truly raised ranches.
We don’t really deal with ceiling height measurement concerns here in Colorado, that’s pretty rare. We have a lot of garden level split home style stock which that garden level space is universally recognized as being tied to above grade space. There is like this consistent ratio of mostly splits, occasional ranches, and varied presence of basement or not for 60’s through 80’s stock.
After that builders turned more to two story and just ranches. People still like the splits so their value factors continue to fly, as they’re not being built anymore. The sad part about housing growth in CO is we have water scarcity issues which are a real problem, so nothing new gets big yards anymore and the side to side setback limitations keep decreasing. Hello neighbor! People will be planting trees in their tiny yards on the outer edge and neighbors will do the same, trees compete and it’s just silly. There is a very high demand for 70’s to 2000’s stock because those are not HOA PUD. Where as all new development is always HOA PUD as the county approval now seeks to offload infrastructure and utility maintenance costs onto home owners with varied quasi private and/or municipal HOA approaches. End up dealing with two HOA’s.
Now builders are full on luxury bigger better over the past few years. High density development is taking hold. But people still perceive Colorado in a certain way and the bi and tri mid 70’s sort of stock with big quarter acre yards continue to be in high demand. If you want the big yard and you do not want an HOA in your life, perhaps a real mailbox in your yard instead of a community box, you have to buy older stock. Buyers compete for these things and they do not care if it’s a bi or a tri or some other weird design, if the livable space is there, they compete with mostly even keel value basis. In many neighborhoods of this age there is a random factor, one home a 2 story, the next a tri, the next a ranch, the next a bi, etc. All their ppsf metrics are in fair alignment, although the ranch tends to track higher ppsf agla, and lower basement. If you’re on a budget, reach for the ranch. If you have money to spend target a tri bi or 2 and then cross your fingers that tri or 2 will also have a partial basement, presence of those is random too. We have fluctuating water tables so sump pump and pits are common and builders have to call the design based on the individual lots soil conditions and water table readings which can change block by block in some locations. Bentonite and swelling soils are common.
This has been a lot of fun guys, great information here. Thanks.
Perfect example of Above Grade NON-GLA. from your link…
The space is finished but the ceiling is too low to count as Finished Square Foot = GLA
Loft = Finished Space NOT Finished Square Footage and thus NOT GLA per ANSI.
This is what FNMA FAQ Q16 is addressing.
https://www.homestratosphere.com/wp-content/uploads/2019/05/Spacious-white-walled-loft-bedroom-with-dark-wood-ceiling-and-flooring.jpg
That’s great. Glad that ceiling height issue a non issue in the suburbs. I picked that link randomly from the net for stylistic conversation.
FNMA should consider a fourth line in the appraisal grid. Ceiling limited space or something.
If we’re going full literal on everything with no deviance or variance allowance, why not clearly categorize everything with absolute clarity?
Above grade line.
Garden level line.
Fully below ground level basement line.
Limited ceiling height not to ANSI standards line.
Every single one of those has the potential to have a different value basis in different market settings and locations, so why are they not defined individually on the FNMA form?
Nitpicking the details… But in a perfect world with a perfect form which emphasized accuracy but not necessarily efficiency, the 1004 would read more like a cost approach table and we would fill out every single detail for the subject and comps to the best of our ability and apply several pages worth of individual line item adjustments. Be careful what you wish for.
By providing a profitable incentive to the ANSI group this is essentially opening up a new market for further refinement of details and expanded mandatory approach scope. Because it will be profitable for them to implement that. Be careful what you wish for.
“Every single one of those has the potential to have a different value basis in different market settings and locations, so why are they not defined individually on the FNMA form?”
You do realize your software has spaces for all that right? If not you simply make a little spreadsheet and link it up. Or write it in by hand.
So yeah, if it makes you happy you could have lines for just about anything. Do your calculations in the spreadsheet and then plug them into lines such as finished space non-GLA.
Where would you put everything if you had a property with Barns, run-ins, indoor riding arena, a pool, pool house, sports court, home theater with actual acoustic treatment.
I mean you have to break all that down and consider it but you don’t need 12 more lines in the form to report it.
We get that you don’t like change.
Quite right. That’s one of my sayings. Had enough change already to last a lifetime, please slow it down.
One of our strengths is our ability to navigate our own systems competently and define different operational procedures as the local situations may entail. Rewriting them for the sake of doing something is just a waste of human energy and manpower. The USA is a collective group of 50 states. Each state is supposed to drive it’s own due process for what works best for them.
You know, back to the basics. I’m a traditionalist. We can be thankful for those whom seek change and those whom seek tradition at the same time. There can be fair balance if we all work together and don’t boss each other around, respect each others points of views and way of going about things. Adhere to the principals of voluntary engagement which prioritizes individual liberty.
Going to start a go fund me page for my copy of the ANSI book. Ha! I don’t want to buy this on principal because they’re trying to force me to do it. There could have been this cool marketing blitz about all the benefits of this but instead they just cut immediately to mandates. That’s not how a free market system is supposed to work.
In all seriousness though, the ANSI work group was not diverse enough and did not leave enough time for public feedback before this was implemented on the GSE level. And what gives with the GSE’s not having a uniform approach? That is telling because most other policy changes run right down the line, Fannie, Freddie, HUD, VA. When things work for the benefit of all, they tend to be widely accepted.
Tom you’re the man, I really appreciate your time.
Thank you.
“Tom, Do you support the ability for appraisers to use the GXX001 exception code for bi’s and tri’s in locations where the assessor does not provide clear enough data to get a garden level break down?”
https://appraisersblogs.com/ansi-measuring-standard-required-by-fannie-mae-in-2022/#comment-34032
What I’m really hoping for Tom, is to break past this use of basement and garden level descriptive language difference to express the point, that appraisers in many locations like Adams county will not be able to apply ansi standardized measurement to their comps, but will have to apply that to the subject.
This will result in false net/gross indicators, abolishing the functionality of this important tool which is meant to indicate the level of similarity vs the level of dissimilarity of the subject vs each individual comp.
Then when you see what I’m seeing, you may hopefully say; I get it now, you will not be able to apply an ansi standard to your comps. You’ll at that moment see what I’m seeing here in Adams county.
Then I’ll say; Do you still support the idea of an ANSI blanket standard without exception in states like CO where we already have a uniform standard and recognize ‘floor space’ as including garden level?
Then I’ll ask an additional question: Will you support my request for FNMA to include bi and tri levels in the list of home types where the GXX001 exception code can be used?
That’s the argument in a more brief format. Sorry it took me a while to form this in a more simple comprehensive manner. We went through a lot of back and forth because of the applications of descriptive language differences, which are obviously not the same in some locations. Some locations recognize garden as agla space, others do not. Some real property market place settings put value on garden level exactly the same as agla space. Other market settings apply a lessor basement value to that space. In some locations builders helped promote a higher value and price basis for garden by always furnishing them with equivalent finish quality, in other locations the garden was presented to market as a basement, often unfinished. In some climates like desert high altitutude dry Colorado that garden level is really comfortable and appealing, so the market recognizes this as equivalent space, sometimes even better space than above grade areas, for comfort factor reasons. In other locations the markets apparently do not give as much credit to garden levels (which is a new concept to me but I can see how that could happen elsewhere.)
Thank you.
First off as I mentioned way back the exception code is not GXX001.
Yes in your scenario I would still support ANSI.
What I would…..
A. Measure my subject to ANSI.
B. Gather my comps.
C. If there is no way in hell I can find any accurate data and the only figures I have for all the comps is a simple overall sq ft figure such a 1437, 1693, 1587, 1399, etc… I would do the following.
D. Write a paragraph fully describing the subject per ANSI such that FNAM had teh true ANSI figures and it could be reproduced by any other person using ANSI standards. … then
E. I write a paragraph informing the user of the report that I was completely unable to get sq ft breakdowns for comps and as such I am reporting the subject in a similar fashion for apples to apples comparison because my research indicated the entire area sells equally in the market.
FNMA can then do one of three things.
1. Yes we that. We will put your ANSI figures in our database.
2. Thank you, will you leave the report as is but also place the exclusion code in the additional features section.
3. Please change your grid reporting to reflect ANSI. Readjust as needed. Do not be concerned about the high line, net, gross adjustment figures.
My guess is they will go with 1 or 2.
Thank you Tom.
That is helpful commentary.
That is my game plan, exactly what you said. Probably with a little extra support pre ansi and after ansi applied, so I can clearly illustrate the net/gross should not have climbed and I did make competent selections. I’m all about proving competency in my reporting and adhering to the principals of protecting the public trust and integrity of the appraisal profession.
It’s just a shame that this is imposed on a region where we already have universally accepted comprehensive standards which have long since brought our entire real estate industry in this state into a reasonably sound alignment. Because in other states it appears there really is a lot of malfeasance and deception going on, counting open space areas as agla, that was a shocking revelation to learn such activity is still happening in this age of improved data relay and technical capability. I agree with the principal of universal standard in any specific region where real property exists. I just do not agree with the method of applying this standard as it is currently imposed as a one size fits all.
Thank you. I learned a lot about what happens in other states. Illuminating.
“I’m all about proving competency in my reporting and adhering to the principals of protecting the public trust and integrity of the appraisal profession.”
After looking at a few listings, reading assessor data, reading how you guys do reports. If I had to buy a home in Colorado I would have ZERO trust in the residential real estate market from top to bottom.
You people are living in the dark ages with regard to real estate data and transparency.
Assessor
—- Single GLA figure, no decks, porches, overhangs, no sketches, no dimensions.
Realtor
—- Copy assessor and add fluff. No additional specifics.
Appraiser
—- Follow the lead the assessor and real estate agents have blazed.
That is a recipe for deception not trust.
I do agree with Chris too though.
If though the data sucks. If you have bi-levels at 1900, 2000, 2100 etc.
You measure yours are 2035.
I would report the Up / Down in grid and divide the comps in half. It’s all the same value so even if you miss by a little it won;t matter. You could have 1050 up and 950 down on the 2000 home in reality but if you split it 1000 / 1000 the dollars are come out the same.
AND the report will show the subject as ANSI in the grid.
Then just explain it. But I can look at a lot of those sales and they are just rectangular boxes. One looked like it had 24sq ft overhang on top level.
So I’m not buying the “it can’t be done in Colorado” line. That’s simply not true.
As I showed earlier. Appraisers in Colorado do have access to the data they need in some areas.
https://www.countyoffice.org/property-records-search/?q=106+Hoedown+Circle%2C+Fountain%2C+CO%2C+USA#structure
Are we still at it? All right, let’s do it.
You can’t guess at data. Guessing at spacial data allotment is not a recognized technique. One agent called this ‘stepping off the size’, we would call that ‘eyeballing it’. Recent sales matter and if you limit yourself to only comping bi vs bi, you’ll miss out on helpful tri sale data, vice versa. With monthly appreciation moves which are sometimes 10k to 20k now and then, recent selections matter more than stylistic matching. I miss the slow market years ago when I could keep it simple and just comp bi vs bi, etc. It’s not that way anymore. CO has one of the strongest growth rates for new housing development and market appreciation in this country.
Tri levels compete evenly regardless of their design factor, if they have that usable space. Some fully above ground, others have gardens. They all sell for the same so there is no need to adjust them out differently. Adjustments are intended for ‘market reaction’ expression, and are not there so we can do busy work with zero tangible benefit. If there is no market reaction, there is not supposed to be any adjustment. Basic valuation principals. And as detailed, tri’s can have varying size and design factors which is hard to estimate. I’ve never heard of a recognized method where an appraiser eyeballs the size for his adjustments. Verify, verify, verify. Multiple data sources are better than one.
No faith in Coloradoans? Oh come on, we have a universal standard and all agents assessors MLS systems and appraisers are on the same page. If you were here participating you’d understand, we tend to work well together and are not wasting time arguing about counting stairs or foyers or whatever. Appraisers don’t just follow up the trail others blazed, although at times it can be that simple and straight forward if the agents have performed their jobs competently with due diligence. Other times the existing data cohesion and reliable systems with universally recognized units of measurement are very helpful. If the agents pushed price value factors beyond what is supported by the market, it’s pretty obvious and simple to prove. We have good consistency which frees up time and energy for other client service needs and keeps liability contained.
There is usually a fair degree of trust and team spirit effort among agents lenders and appraisers in Colorado. DORA state regulatory body is no joke, they keep everyone in line and sanction those whom commit to deceptive practice. DORA boards even fired the director once for the appearance of impropriety even though none actually existed. But generally they’re fair and if you abide the local standards with due diligence they’re in the back ground. When there is contention or disagreement they issue clarification statements. Our regulatory body publishes quarterly updates which keeps all of us in the loop. When there is dysfunctional process somehow, they mandate new forms and disclosure approaches. We also have a universal standard for purchase contracts, very helpful and well thought out.
The hot sun. The high altitude. The wildly swinging temperatures where it can be frozen at night and baking by day certain times of the year. That takes a toll on exterior structures. Snow, wind, hail rain. Rip the dang gutters and adornments right off your house, snow fall takes my rear light out every other year because I don’t have a large enough roof eve. Decks have short life spans, so do fences. Concretes can crack with one season of mis management. There is a high cost of maintaining exterior structure here and although there is a permitting process and recognition of that, the assessors often do not record all the ancillary stuff. Information on that is available with permit track history and by way of the building department if you absolutely have to have it.
From a citizens perspective we appreciate this lack of attention to those recording features. Because we get taxed less. It’s important to understand the cultural difference. This was pioneer territory and still bears resemblance to that in many policies. It’s none of their dang business if we have a little deck or porch or whatever and although permit processes exist, unless it’s a big project the city/county authorities are usually not overbearing breathing down everyones neck to prove compliance. People go off code all the time and they’re never really any tear down order for many ancillary items.
This state tends to have more focus on the home itself and regulating contractors, so for matters of the home, there is rather strict oversight. You can simply not find an electrician or plumber to go off code unless they’re your personal friend, even then they’ll probably refuse. DORA is strict on contractors so we do have good protections for home owners in this regard of many vendor servicer applications. For what you do in your yard, that’s your business. And you can just learn that data from listing photos so what’s the big deal with fine detail of assessment reporting? I guess that’s my take on this. It seems like bureaucratic overkill to document every last thing, I’d rather have one less county employee and lower taxes. Ha! It’s a typical sentiment.
We’ve got it figured out over here and do not appreciate the external meddling. Sounds like some other areas need a complete regulatory overhaul, something an FNMA applied ANSI standard without any actual jurisdiction over these locations is simply not going to successfully accomplish. ANSI looks like a paper tiger. Don’t want it. Don’t need it. Don’t appreciate it. You don’t win trust by running the wrong direction on the field. If the CO NAR community wants it, they’ll implement ANSI on the MLS level and assessors will be forced to follow. Otherwise, to apply this standard only to appraisers is counter productive to the cause of improving credibility and consumer confidence in the process. We have an existing universally accepted method in this state that works and works well. There is nothing wrong with agents assessors and appraisers being on the same page using similar methods, in fact it works very well. You guys are reaching for something we already have. Think about it.
Is there an exception process?If the appraiser is unable to adhere to the ANSI Standard, the appraiser will provide the code “GXX001 –” The wording and approach to this is just ameture hour. We’re able to adhere. But it makes very little common sense to do so. Especially given the factual situations we will not be able to apply ANSI to our comps in every location and this will drive false net/gross indicators and other problems. Even if we did have all the sketches, and can apply the ANSI standard, which in some areas that is available, this still does not answer the question of why apply a market reaction adjustment for a bi vs a tri when there is no expression of market reaction difference there in the first place? ANSI in this scenario is just busy body work with no tangible benefit to anyone here in this state. Whipping us all around for their government systems and book sales, it’s going to confuse consumers. Where is ethical principal?
“No faith in Coloradoans? Oh come on, we have a universal standard and all agents assessors MLS systems and appraisers are on the same page.”
Well no, not all. You keep forgetting that assessor that breaks down the actual features of the property. You know, the one I posted twice and you pretty much dismiss.
Your cozy situation with agents and assessors and ‘mums the word’ on actual physical characteristics. Isn’t that sort of how the mob works?
“There is usually a fair degree of trust and team spirit effort among agents lenders and appraisers in Colorado.”
Like the ‘good ole boys club’. Sounds like a sweet deal. Go team go! Forget that I’m an independent unbiased appraiser, I’m a team player too.
At least it’s nice to know the electricians and plumbers work to a national code.
I’m not sure what part of the Universe your universal code came from, but something tells me it came from a far away planet out there past Saturn.
I hounded the local MLS here for decades to add square foot fields for basements, unfinished, etc..
the reason why was because the assessor would have simply the whole basement.
The Agents would list AbvGnd + Bas as a single figure. 2500 sq ft. — Reality was 2000 + 500 fin.
First Floor 1000, Second floor 1000. Basement 1000 with 500 of that finished.
Now they still report
Finished Sq Ft = 2500
Bas. Fin = 500
Bas. Unfin. = 500
Now I have an actual verification source. I can equate the assessor to the agent.
I can not believe that appraisers in CO are not screaming at the appraisal board to pressure the MLS systems and assessors to report factual data.
If you are an example of other CO appraisers it sounds like nope, we just live a happy little life together.
It’s mind boggling. I get why the agents and assessor don’t care. Especially the agents. The assessor would probably actually like to have a nice data system.
Not directed at you personally but you have mentioned over and over that –all of Colorado– does it your way. I assume all of CO is pissed at FNMA and wants to continue to keep things very simple. A single GLA figure and let ‘er rip.
That boggles my mind. If it were 1990 ok, 2022. Just unbelievable.
This is an unexpected tone although I probably deserve it. Let’s get together with a team effort instead. There is nothing wrong with appraisers and agents communicating and working well together. People trust us because we are trust worthy.
If people were screaming for change, that change would have already happened. We’re doing pretty great and I have not heard about many issues over the past several years. Our state even implemented a group insurance access for EO for appraisers and realty agents program for cost savings. They’ve continued to refine rules for all three sections of mortgage realty and appraisal. Uniform contracts with approved forms is really great.
I have not dismissed your example it’s just from El Paso across the state where I have never and will never operate. Subbed in relevant examples which I could talk about with more experience instead. And qualified the nature of data availability, some areas fully yes, other areas, not as much.
The assessors here can’t keep up. Although they all expanded and filled more desks, it’s just government, reactive to demand rather than getting ahead of it. That’s normal.
The note of being on the same page specifically details sizing, and after that, it can be a little random what the assessor chooses to present. If professionals or the public relying on this data wants more, they can always ask. Because we do not operate under an ANSI standard, parsing garden levels has never been a problem before.
Again the ‘qualifiable floor area’ approach works very well for the housing stock we have here in this state. It appears to be much more comprehensive than the ANSI standard. The question of who defines the language and the presence of different explanations of what constitutes a basement can go either way, one can selectively search and find definitions that fit the intended narrative. I learned something new about our local counties and you know what, I do appreciate the way they approached spacial recognition. I’m thankful they did it this way and we do not deal with some of the issues that appear to vex appraisers in other states.
I will reiterate how this is well functioning too, because within bpo and appraisal grid work, our net/gross reflections are true expressions of material difference and do not arbitrarily provide false indicators of difference because we have had to juggle back adjustments for technical reasons. I think the story of two tri levels next door, one with some below grade area, the other without is a good example. Because they both sell for the exact same amount so there is no justification of applying adjustments against them. Every single adjustment that hits the appraisal grid should be for market reaction items. If there is no market reaction, no adjustment should be applied. That’s my opinion on it.
Our appraiser count I think is just over 2k. Our largest realty organization CAR Colorado Association of Realtors has I think 25k or more and I think nearly 30k licensed sales agents in the state. And there is a network of many other smaller orgs and groups. Our state has 5m+ residents although nobody knows for sure there has been so much influx. You’re going to continue to have a tough time crafting an argument that we are incompetent or a good old boys club because the body of professionals here is quite substantial. We have sufficient checks and balances in place. If these groups need change to happen, they have the ears of legislators to materialize necessary change. But if they choose to do so is our business, not the business of the federal government.
I’ll qualify for BA here. I have no financial interest in ANSI, FNMA (other than GSE appraisal orders), am a true 1099, and nobody paid me to be here and I have not coordinated with anyone else regarding statements made. My opinions are mine and mine alone and may not necessarily reflect opinions held by other professionals institutions or groups. (I would think that at least a few agree though. The disappointment and confusion with the NCAREA groups ANSI class which had been posted to YTB was palpable and obvious. Gasps of disbelief and head shaking… There was one guy whom said it’s workable and you’ll get used to it.)
If you want a truly well functional measurement standard, I would think a better approach is a standard applied to each specific type of home in every age category. We’re going to need a lot more standards! We need the flexibility to be adaptive to various property types in different settings. We should not discredit something already in existence and suddenly describe it differently just because someone elsewhere far away does it differently. Sometimes the traditional way of getting a job done is the best way to get a job done. Other times modern new methods work better. But there is no fixed rule one way or the other that can be guaranteed to bring optimal results. When the wind blows, bend like the reed.
Truly when it comes to measurement, the appraiser should adhere to the standards defined within that specific county. The basis for uniformity already exists, as the county has already prescribed and published their own standards. Like a sheriff is the law of the land in a county, that counties lead assessor calls the shots for real property. If you end up in another county, you should know their standards. There is insufficient justification for reinventing the process of defining recognized spaces. “measure to the standard prescribed by the local municipality in that jurisdiction”. I just accomplished the same result of reliable reporting in a single sentence.
I like how you cut a joke at the end. I’m not sure dude, these are just my personal observations. This is my perception of what appears to be happening. NAR is a reflection of this reaction, they did write a letter asking for a delay of the implementation of ANSI to provide more time for education and feedback. I searched the NAR professional classes list and could not find one single class on ANSI measurement methodology. But also I’m not a realtor and am not sure I was searching properly, they did have like 26k different classes I think.
For the other presumptions, sorry if we’ve got off on the wrong foot or something. And we can cut jokes and and have fun while still being professionals. Or we can get yelled at, brush it off, and still be professionals. We can all go along to get along and still be independent. Independence is key, and the very nature of being independent is contrary the the dictatorial approach of required mandates. Sure there needs to be industry cohesion and we can benefit from rules and standards. Those standards should not be applied if they do more harm than good. Face facts, in Colorado a garden level is not a basement. That is our objective truth. Well, that used to be the case… The market recognizes this truth even if FNMA and ANSI does not. Which force is more powerful? You know what they say; from the eye of the beholder.
Thank you.
“This is an unexpected tone although I probably deserve it. Let’s get together with a team effort instead. There is nothing wrong with appraisers and agents communicating and working well together. People trust us because we are trust worthy.”
Possibly mis-read but when I suggested you contact an agent to get more data on a property you responded with basically why would you want to do that, what could they possibly have to offer after the closing.
I used to have to do that all the time before we got better data. The agents can clarify GLA, They can tell you about funky floor plans. quality levels. etc.. So I read that to mean you basically look at the photos and that’s it.
Granted a bi-level is pretty straight forward but around here someone could buy one of those colonials like you saw for $750K and then spend $300K more renovating and altering. You get a 100 or 120 year old home that has had that done a couple times and you can’t figure why do the numbers say one thing and the price says something else. The agents are the only ones that can describe it to you…. and that’s after closing.
Anyway… at least you got the joke. I thought you’d appreciate that. It was meant in jest.
But I’m a “more data” person. More makes my life easier. Everybody measuring and reporting the same makes my life easier.
Oh well, if you could get rid of that snow situation out there I could move out there and just specialize in Bi-Levels.
You know, agents can take some pretty good photo sets, learn a lot. Every time I have to ring agents lately, long conversations. I try to only deal with data I can qualify right there without the call. Limit the calls to pending UC status as it’s just so routine for over list offers lately, can’t even use a UC unless it’s verified. My last one was +$80,000 over list. Colorado is bonkers, bananas, excessively spicy. They’re trying to get in, we’re trying to get out. Fingers crossed our liberty destroying progressive governor will finally be ousted but not likely. We may move to an entirely different state.
Snow in CO is not all bad. Here today, gone tomorrow at lower elevations. In the mountains though, end up on the shady side you’ll wonder if it’s day or night and the snow never melts. It’s the summer heat too. All I have to do is step outside for two minutes in July and I light up like a marshmellow over a campfire. I got a sunburn just prepping the garden last week.
This is it, our biggest garden year ever. Last year we had a tremendous harvest and actually learned to can and such. How rewarding, true organic and we used them for stews and spaghetti all winter long. Going big old patch of tomatoes this year, trying potato towers for the first time, going to grow the scorpion trinidad peppers again. Watch the hell out for those evil bastards! I can’t turn away! Once you tried a trinidad fresh off the plant you’ll never think of other hot peppers the same. One tiny pepper can light up a dozen people, no joke. Here I’ll snap a photo for you. Hoping to toss in some tiny bird hotels to attract chickadees. We have a woodpecker terrorizing us every morning. Getting more ladybugs in the can and hoping we can snatch one of the praying mantis egg pouches before they hatch or sell out. Organic gardening 101. We’ve been at it many years but finally are getting the hang of it. Now I’m learning about seed germination because with a garden this big, buying ready grown is going to be too expensive and I’m hardly working. News on the Fed front says expect continued rate rises to the point of a market recession. Buckle up! We keep a year or two pantry food on hand to be on the safe side and have a stack of toilet paper from the floor to the ceiling. Not going to fall for that one again. The down side of free time is I’m constantly running out of beer. ha!
“scorpion trinidad peppers”
I think my overall favorite is a real Jamaican Scotch Bonnet. They are hot but flavorful. almost with a blueberry / citrus after taste. If you put too much in a meal you can usually calm it down like in a soup or something. Add more ingredients.
“The down side of free time is I’m constantly running out of beer. ha!”
That’s a sin. Unless of course you have some nice rum.
I appraised a guy’s place one day and he was growing some Carolina Reaper’s. At my age I have a hard time convincing myself I want to eat something that is basically a weapon. I might grow some hot peppers this year. I think the Home Depot even had the Carolina Reapers last year.
I’ve been buying pepper spice lately. I like to make a mix that you put on whatever your meal is.
Aleppo
Urfa
Sichuan Pepercorn — not really pepper. Eat some by itself. It will numb your mouth. Really strange.
White pepper
All the Tellicherry colors
Japanese Togarashi
Once I get my mix down right I’ll send you an autographed bottle. You can sell it on eBay and be able to afford a copy of the ANSI standard without feeling guilty. |jk|
Remember Fannie/Freddie are not the know all be all, if your engagement letter does not require you to follow the new ANSI then you don’t have to.
Check this out! GXX001!
Now we’re cooking with gas again!
Note the true expression of net/gross, as the MARKET REACTION dictates an even balance. With a side note.
I’ve complied with local jurisdictional standards. I have reported in a manner customary and familiar to all the local participators in my market location. I have not falsely driven gross adjustments upward. Instead of looking like a fool I look like a pro again. Whew! Barely made it! Another appraisal miracle. Winning!
Forgot the A frame link. Those are interesting homes. And they have this mysterious quality where they can scale up or down. Quite interesting. I would never want one but some people appreciate them.
Thank you.
This is interesting it’s like a wedding site link but shows a fair variety of CO A frames. They are a market to themselves. ANSI is probably going to work well with that specific housing type, because they all have the same design shape and similar measurement conditions. So they’ll all adjust up or down rather uniformly.
The same can not be said for bi vs tri if we have to get away from floor area recognition and instead have to deal with a ground level reporting basis. You know, I never knew the exact details right here at home. Just took it for granted because a universal system was in place, most everyone abides by it, and we just don’t face those same problems with wildly varying measurement strategies. Or at least we never used to. I think I’m going to go ahead and get mad again. Just Kidding! Gotcha. Or wait, I’m not sure. Really hope someone at FNMA reads this. This may be the most posts ever blog on this site, I don’t think the political or racist ones even got this much traction. This has been entertaining and informative. No hard feelings, appreciate everyone whom participated. Thanks again.
https://samanthamitchellphotos.com/2021/01/24/best-colorado-a-frames-airbnb-colorado-elopement/
OMG…. REALLY PEOPLE ???
Sounds to me like the patients are now running the Asylum!!!
I am really hoping ANY ONE on the Appraisal Standards Boards is reading this.
I think there’s more than one TROLL here. MAYBE a few of FNMA REPs ?
Not sure why the surprise. It’s all good, we’re putting this one to bed soon. Don’t let it get you down.
I’m technically trolling, but hopefully for the right reasons, of benefit to someone somewhere.
If an FNMA or ANSI rep is here without disclosing that, well, that’s a bold accusation and we hope in good faith that’s not happening.
Baggins I was not referring to you being a troll. Carry on….
As far as I know there are no rules on disclosing on a Blog. We all just hope that we would not operate that way. Don’t kid yourself though. Everyone in all industries including law enforcement read and yes even comment on these sites to get a feel for the acceptance of an idea or other info pertinent to the subject they wish to explore.
Let’s face it though, to advise someone to just assume or make up Data or to adjust with out market acceptable Data is really not so good IMO.
FNMA is saying based on the experience , knowledge of the area and styles the appraiser should be able to come up with a GLA?? AND AN ADJUSTMENT? Thats just wrong and I’m pretty sure that is not what any of us were ever instructed to do by anyone.
No it’s all good I don’t mind. I jumped up several times over the past few days. Got to catch a break this never ends. And then out of the corner of my eye…. The blog boards kept calling me… Ha! I really love this website. The banter. The free expression of speech without big tech meddling. The rich body of information that comes forth. The oftentimes starkly different opinions and positions. The ability to post a meme. No robot posters. This is how free speech is supposed to be. I hope someone from big tech takes notes! Thanks again.
Baggins… Well said, as usual.
Are you talking about me?
I never said to make up data.
You can certainly look at these simple bi-level homes in CO and speak about how to approach ANSI standards in context. Any numbers that have been posted have been fake. Who is telling people to make things up.
Thank you guys, all of you sincerely. Don’t worry about it. This thread was at times, quite heated.
We’re all in it together, that’s the most important part.
We operate in good faith. I wish FNMA would do the same in regards to ANSI FAQ 7
Q7. Can appraisers use the exception code to voluntarily opt out of compliance with the ANSI standard? No (fists pounding on the desk!) I mean this is professional guidance? If the question had to be asked then answered in the first place…
Since there is no limit here. I’d like to share one of the most insightful area research links I’ve ever come across. We’re hoping to take a step away from the big city so between this and google maps we can actually learn a lot about places we’ve never been. This site I think is census based so it’s relevance fades with each passing day but it can still be a very interesting tool to review. Just pop in a state, county, or city, then click the drop down list of what you want from the search line, wait for the load time. I’ve spent so much time on that I’ve never even clicked all the various boxes on the front page, sure there is a lot there too. It’s mostly demographics and stats.
http://www.datausa.io
Baggins if you don’t mind. email me. You now how to find me
richmondappraiser
gmail
I don”t want to have to try to figure out who you are by your screen name. Those days of my life no longer interest me in this context.
TOM…
What??
Didn’t you read this in that post ????
FNMA is saying based on the experience , knowledge of the area and styles the appraiser should be able to come up with a GLA?? AND AN ADJUSTMENT? Thats just wrong and I’m pretty sure that is not what any of us were ever instructed to do by anyone.
I call that guessing. How else do you interpret “experience and familiarity” as a good source of GLA in comps you’ve never seen and the Auditor reports and shows a 1 level sketch with no basement? How do you support adjustments when you have no idea based on fact or knowledge for room count and GLA HMMM….. GUESS??
sorry, I didn’t answer your other question…
“I call that guessing. How else do you interpret “experience and familiarity” as a good source of GLA in comps you’ve never seen ”
If you have never seen something it would be difficult to have experience and familiarity. However if you were appraising when a certain subdivision was built and you appraised a bunch of them 10 years ago and you know the builder only had 4 plans and you scanned the floor plans and kept them in your files.
That is an example of experience and familiarity.
I think your area may be quite a bit different than mine although the East Coast is a vast area so I cannot be positive.
Your theory would be pretty good but not so much here on splits and bis and not in the past 4 or 5 years IMO. I had a listing that the owner made all open concept. Removed every wall between LR, Kit, and DR for one open room. Then added a bath in a far corner of the family room .They also enclosed and added heat to what was previously a patio. So nothing was as it was when it was built including GLA.
I have appraised many splits . WE do not have endless areas of homogeneous housing here. There could be 5 splits in an area of 1 mile with many other homes of varying ages, styles and sizes. Maybe 2 3 level no basement, 2 4 levels with partial basements and maybe 1 4 level with a basement and a crawl under the walk out FML room. The auditor labels them all as one floor. Realtors just label them split levels here no floor count most of the time. So first you don’t ever know which one is which until inside, One more style it a 2 level with a garage and utility room. no basement, Now when the open concept design gained popularity many people opened up the floor plans of all style homes all over and in all ages of homes. This does not show up anywhere most of the time. Now we also cannot determine condition with the exception of photos and some unreliable MLS comments. So one has a C3, one has a C4 and one even a C2 . Now you don’t know much on these as there are so many variables. Say Only 2 sold in the past 12 months. You can find out quite a bit but not recently completed changes or reliable measures for basement and crawl space cause those are simply not measured here most of the time. OH I forgot that a sunroom was added to one and one claims a four season rm but Pics show no heat ducks.
So now FNMA cannot tell us HOW to get the info for ANSI measurement cause there is none yet in all of these homes right now and may not be for years! We do not know if there are 2 or 3 stair cases or any other say low ceiling height areas, no way to know what they measure. We don’t know basements or crawls. FNMA stated make an educated “decision” I say GUESS . Do you subscribe to their direction on this? Just wondering
Just a side note I did a 3 level Bi level which is pretty unusual.
wow, perfect example. I just replied to you. The first one is gone. the second is left justified.
What I posted to you earlier is that I can’t tell what your post was in reference to.
I did not –think– you were talking about me but as Baggins and I were making most recent posts and you said it wasn’t him I figured I better ask.
The visual format of these blogs is terrible on my pc. No rhyme or reason as to where posts line up or what they are responding to.
My first comment will probably now show up somewhere out of the blue.
I agree with a STANDARD form of Measuring. I am NOT against ANSI. I hope I have clarified this.
I am however against FNMAs or any other lender’s over lays and requirements for appraisers to determine the MARKET adjustment of anything that the Market does NOT even recognize. I do understand the grid and equal value direction as well, stuff I call needless work. I also know that a lot more narrative/time is required with this. JMO And I am deadly against PFA adjustments that are not reliable because the measurement system is not universal and can not be properly implemented and enforced until it is made universal for all fields/Professions dealing in REAL Property with/for/ or in connection with the public. I could even deal with that chaos if the appraiser’s neck and E&O was not on the line!!
We all know that lenders have ask us and still do ask us to do things many time that we cannot/should not do because we have an appraiser’s license. They don’t care cause it’s not their license on the line and not their job to protect ours!
They ask us to revise the appraisal because the contract price was changed after the appraisal when their own lenders guide tells them it is not required. They do not even know their own rules and requirements. They ask us to omit things and change things and re write things in ways we know we cannot do. Again its not their license.
Now FNMA is asking us with our “experience and knowledge of the area and styles” to adjust when in 2020 and before they clearly stated MARKET BASED ADJUSTMENT MUST BE USED. and “an adjustment based on experience or peer actions is NOT acceptable”. The number 1 violation and cause for suspension /revocation of Appraisal licensing here in 2019 was non supported adjustments or :ADJUSTMENT BASED ON ANYTHING OTHER THAN DATA.
I ALREADY POSTED THIS BUT JUST IN CASE HERE IT IS AGAIN…….
In 2020 FNMA released this
Fannie Mae recently made some important changes to its policies on comparable sales and gross adjustment guidelines. Their newly launched Collateral Underwriter (CU) took effect on January 26 2020.
It’s important to be aware that the rules of thumb many appraisers are accustomed to using for adjustments may no longer apply for appraisals on Fannie Mae loans. For one thing, Fannie Mae has eliminated the 15% net and 25% gross adjustment guidelines.
According to the agency, it will no longer have specific limitations or guidelines associated with net or gross adjustments. “The appraiser’s adjustments must reflect the market’s reaction (that is, market based adjustments) to the difference in the properties of chosen comparables,” according to Fannie Mae. That means that appraisers shouldn’t use a $20 per square foot adjustment for the difference in the gross living area based on a rule-of-thumb when market analysis indicates the adjustment should be $100 per square foot.
Instead, Fannie Mae expects appraisers to analyze the market for competitive properties and provide “appropriate market based adjustments” “without regard to arbitrary limits on the size of the adjustment.” In other words, appraisers will no longer be constrained by gross adjustment limits.
This is important to keep in mind Appraisers who always use a $20 per square foot adjustment will likely find their appraisals are flagged by Fannie Mae.
The agency also revised its policy on the age of comparable sales selected by appraisers. Appraisers no longer need to provide an explanation when using a comparable sale that is greater than six months old. “In some instances it may be appropriate to use older sales with proper time adjustments rather than a dissimilar more recent sale,” according to Fannie Mae.
So, comps that have closed within the last 12 months will now be considered by Fannie Mae. And in certain cases-such as on subject properties located in rural areas-it may not be possible to find three comps that sold in the last 12 months. In those cases, appraisers may use older comps as long as an explanation is provided, Fannie Mae clarifies.
This new change in ANSI and all the rest is open for interpretation in a lot of ways as they state our experience and knowledge should be enough for reliable results in extracting adjustments on or for properties we have never been in ! Even 2055 or the NEW hybrid reports do not make us this vulnerable. Also I question why at the same time they brig out the Hybrids that require LESS work by a Licensee and LESS uniformity and accuracy they ALSO bring out a standard measurement requirement for consistency and uniformity.
Doesn’t anyone else find this a little TOO coincidental?? There is a lot of ambiguity here and a lot of it is going to hurt a lot of our peers and possibly change out industry in a way that is not good for Appraisers. IMO
BA… They did away with the net and gross and individual 10% adjustments because appraisers were not making adjustments to conform to these rules and their appraisals look like crap and not worth the paper they were printed on. They were doing this because the lender could not sell on the secondary market if these rules were broken, and these rules needed to be broken in order to appraise the property correctly.
I continue to see appraisal reports written by appraisers making a full bath adjustment of $1,500 and a half bath adjustment of $1,000, when you can’t even build a patio anymore for less than $3,000.
The restrictions that were once upon us have been removed with comp selection and adjustments, they would rather have the right appraised value than some junk piece of paper with an appraised value that makes no sense when looked at by an intelligent individual.
We all agree the new concept of management companies have destroyed our profession trying to follow these old rules, that is why they have been changed to allow the appraiser more freedom in getting to the right number And not worrying about how the appraisal “looks”.
Half the appraisers in this country and I mean half have no idea how to appraise real estate, they were taught by their mommies and daddies who coddled them throughout their traineeship and do not deserve to be considered real estate appraisers.
These appraisers have not been following the guidelines regarding how to measure a house, instead they have been copying the assessor sketches and I have seen appraisal reports that these sketches don’t even match what the house looks like in reality.
Our profession has been at stake for the past 30 years because of lazy unintelligent appraisers that were lucky enough to get state certified.
It was over 10 years ago we were told that anything below grade, whether it be a foot or two must be called basement level, there has been such an uproar even about including a two-story open family room as gross living area when it is actually gross building area.
As I have read these comments over the last month by crybaby appraisers who do not want to change their old ways, who do not want to start thinking, and who rely on computerized data models for their adjustments regardless of what is below grade and what is above grade.
I trained an appraiser who ended up as the number one reviewer for a large mortgage company, I asked him how it was going, and he said all he does all day long is explain to loan officers and real estate agents about below grade and above grade GLAs and finish below grade areas, and that sun porches cannot be considered GLA because they are just sun porches enclosed by thin pieces of glass, he has to explain what an attic is, what a finished Attic is. He says 10 times a day he has to have these conversations, and now finally the real estate community will understand and be taught in their classes how to measure a house properly.
ANSI is a good thing, but it will take time, for people to conform, and one day everybody will be on the same page except for the assessors in this country who do mass appraisals their own way with their own sketches and their own systems of assessing values for tax purposes.
As far as I am concerned, the lazy appraisers stealing assessor sketches their days are finally over!
And one appraiser in particular, will finally realize that a garden level below grade area does not have the same value as an above grade area in any marketplace in any place in this country, because once he starts to separate his adjustments he’s going to start to see the value differences.
The movement to ANSI is long overdue !
Curious. How could two tri levels in the same location sell for the same amount, when one has a garden but the other does not and is fully above ground? This defies logic! You can say whatever you want in a categorical general sense but it does not change the data which the market presents. On one hand you’re all on about appraisers using static adjustments fixed in space regardless of the market data, of course that is proper to call out as an unreliable method. Then you apply a static rule of thumb with an extra ordinary assumption (not just an ordinary assumption), that appraisers will see by using ansi that the garden levels do in fact carry less value. The only way that could be true is if we improperly co mingled the finished garden areas with the grimey basements. Otherwise that statement is not true. Please allow me to respond; No it does not. A bi a tri, they move the same based on market recognized living area. The important concept of the invisible hand and market forces. Reporting something in a different manner will not change the market forces at hand or the market response to it. If somehow you’re crafting a statistical presentation which indicates otherwise, well you know what they say, lies, damned lies, and statistics. There is a difference between a basement and a garden level. Let’s explore that difference.
Here, logic check. Imagine a tri level home, garden level lower where the fireplace is, the primary family gathering area is, a bath room down the hall, a garage out front on that same level with driveway at ground level, a 2 car garage. A slightly elevated earth situation on the rear so the rear windows are a foot above the ground, watch the kids and dogs play, complete visual access to the rear areas. Open the windows get fresh air. Sun shining in the room casting interesting shadows and lights. And a small hallway which leads to the bath door, the garage door, and a basement door. Behind the basement door is a dozen steps and a 10 foot handrail before you get to the concrete floor square unfinished basement room which resides under the mid level of this tri level property.
The basement is where you find the laundry, the hot water heater, the furnace, the sump pit and pump, spiders and dust. There is a small window with a small window well and at just the right time of day, the sun shines in this area for about 10 minutes until the angles no longer support direct sunlight. This area you normally have to use electricity to have lighting. There are no heat ducts here in this area so it’s always a little colder and the air is generally stale. When the door on the garden level is closed, this is an area where you can’t tell anything about what is going on in the house or the yard. You’re a dozen steps down behind a closed door and the family sort of looks at you funny when you come out of the basement, slightly surprised you actually wanted to be down there on purpose. But you are going through a goth phase and watch too many vampire movies, having acquired a newfound love for dark scary places and an aversion to sunlight and open air like a normal well adjusted human being. So you like basements instead.
Mother father grandparents cousins, all over to visit, having a conversation in the mid entry room, the mid level dining and kitchen, alongside the lower garden level family room. They’ll all communicating. Grandma passes a piece of bread down to grandpa sitting in his favorite garden level chair by the wall. He looks up from the garden level and shares a smile with his lovely wife sitting at the dining room table. Honey are you ready for movie night in the living room? I’ve got the fireplace ready, the movie is in, television is on, popcorn, the kids and guests are here, everyone grab a chair it’s movie night in the living room! As the family sees what is happening in this lower garden level from the kitchen dining and entry foyer from the mid level, with direct line of sight. Everyone in all three spaces can hear smell feel the heat, the same because all that living area is one big cavity of shared air and heated area. The family commutes to the garden level, carefully navigating the 3 or 4 count stair set with 2 ft handrail to make their way down to that cozy berber carpet and sit down by the fire. But young Billy being the wild man 8 year old that he is just hops the entire stair set cause he’s into jumping and has a lot of energy tonight. Thankfully he did not fall but nobody was worried, he only dropped down two feet. Someone steps to the rear window and says, look how beautiful the sunset is. The kids out front ride their bikes off the street to the garage, kick them down, open the garage door, and steps right into this garden level family room area, perhaps stopping to use the restroom. Someone has to walk to the basement door to tell crazy anti conformist activist son whom just can’t seem to behave normally like other people, to please come on up out the basement and participate with the rest of the family. Because way down there behind the door they could not hear smell or feel the warmth like everyone else did on the garden and mid level, nor could the conversations be heard.
Back to the family room. Oh wait sweetheart, didn’t you hear about the ANSI measurement standard? We’re having movie night in the basement now! The family appears confused. Father in law steps in, obviously our young son in law must have had too much to drink, he’s not thinking clearly. Are you all right son? You just called our family room the basement. Didn’t you hear, this is a basement now! We’re all required to say this is a basement, that is the new law of the land! I could lose my job if I don’t call this a basement! I’ll lose all of my lending clients and they won’t let me push reports through FNMA unless I call this a basement! Father in law walks son to the garage door, navigates the single step to get 6 inches down to the garage floor, and then walks a flat concrete garage surface with beautiful floor sealing out to their driveway and front yard. He walks a flat plain to the mailbox and checks the mail, hoping some fresh air will bring his son to his senses, understanding he’s probably just a little stressed from his job as a real estate appraiser. Does this look like you’re in the basement right now son? Are you o.k.? Maybe you should go to bed early and get some rest, skip the movie night. You’re not thinking clearly. Let me make sure you’re o.k., how many fingers am I holding up? What day is it. Do you know where you are at right now? Did at any point today did you fall and hit your head and get a concussion? You just demanded everyone call our living room a basement and you seemed really convinced that somehow that was a basement. You know the basement is the room by the bath behind the door right? Remember, where the laundry and furnace is, it’s dark down there and that’s where it flooded when the water heater broke?
Per the sunroom and ancillary room sizing counts. It is a shame if appraisers can’t understand the basics of ‘what is a living area’, vs ‘what is not a living area’. It’s not surprising though given how the other appraisers push them around with illogical tenants, that the appraisers then themselves fail to grasp other basic logical principals and get confused. The rule for counting sunrooms is they must be fully converted to interior living space to qualify. They must be; heated, finished to a similar standard as the home, have window egress, have quality doors and windows which would otherwise be seen anywhere else within the primary home areas, have a ceiling, a roof, insulation all sides, electrical service, a heat duct which feeds directly into that room space, floor finishing and wall finishing to a similar interior standard, and must somehow have achieved a functional design which lends this space easy access and shared heated air to the rest of the home. Most accomplish this by removing what used to be the rear sliding door and making that an open square instead, some also dress it up and punch a knock out in the wall so there is more air sharing and a new ledge where those in the other room can look into their finished area formerly sunroom which is now qualifiable living space.
It’s just that they need to be careful with this sunroom addition. Because if that damned dog starts digging holes again and kicks a few feet of dirt up against the side of the home, that area ceases to be above grade and becomes a basement. That damned dog, he’s a real busy animal, he digs holes 5 ft deep and creates mounds 10 ft across and three feet high. He really goes at it. Once we got back from vacation and he had dug up half the yard and we had an entirely different terrain! That was unfortunately the day the real estate appraiser came over. He climbed up this hill the dog created, took a photo of this mountain of dirt pushed up against the side wall where the sunroom area is and said, nope that’s below grade, and then just like that our carefully planned living area, our favorite area of the entire home, and the appraiser said (hold on let me quote exactly what you said here chris) “a level below grade area does not have the same value as an above grade area” And just like that the thirty thousand dollars we spent finishing our sun room vanished into thin air. We called our sales agent whom reviewed our assessment record and she confirmed, the assessor counts that as living area and taxes us at that amount. The sales agent also said don’t worry about it because when it comes time for selling the home, she will market that as living area, it will be priced the same as all other living area, and she has market evidence that buyers won’t care about the slight changes in ground elevation because buyers do not make their purchasing decisions about the technicalities of what is above or below grade slightly, but rather buyers consider the functional usable heated space areas and nobody would be so rude as to try and swindle us out of so much home value by improperly identifying our nicely finished sunroom as anything other than a well finished living area.
Telling the truth as everyone around you will understand clearly is the truth, that matters and matters a lot. Living by your own code and describing things contrary to the way everyone else does is not good honest transparent valuation practice. If this was star trek all you ANSI supporters would be like the nerds in the corner talking kling-on language even though nobody else in the room could understand what you are saying. You think you’re elite and awesome with this special thing you’ve come up with. But I’m sorry to inform you, some of the rest of the room though you were weird and sort of out there in your own world. They don’t want to invite you back for the next event party. And that will be the real world reaction appraisers face with this nonsense. I agree though, no wonder people don’t trust appraisers. We’ll look at a blue sky and find a way to describe it as green and fervently believe it’s actually green despite and and all evidence to the contrary.
I never knew I had spent so much time in basements when I was a kid. This explains a lot. I’m learning new things about myself. I grew up in a tri level with garden and a basement. I though I spent all those mornings days and evenings in the living room on the garden level. Actually I was living in a basement and just never knew it. No wonder I found the sub basement second basement so scary. I may have already lost my cool from being in the first basement for too long. I should have never read IT, because everyone knows, clowns live in the basements and they are scary places. I’m not sure if I’ll ever have the courage to step down to the garden level again because seriously, I am afraid of clowns. It’s one of our family jokes whenever the girls have to go fetch something from downstairs. “Watch out for clowns!” “IF you see a red balloon, get the hell out of there!” Sometimes I inadvertently scare myself with that and find myself unable to run down there to grab the bag of pretzels because everyone else is asleep and nobody will be available to save me. I’ll open that basement door peer down into the abysmal dark depths, fiddle with my light switch even though I know the light switch has been broken for 10 years, I’ll try to flick it anyways. I keep a flash light right there by the door but my daughters always take it so it’s never there when I need it. I’m frozen in fear and can’t take that first step. I watched too many scary movies as a kid involving creepy dungeon basements. I close the door and check twice to make sure it’s clicked shut, always creeps me out when it opens on it’s own if it’s not clicked shut. I’ll just find something else, pretzels are not that important. That’s when I realize, I’m still in the basement! Because I’m on the garden level! The horror! This can’t be happening, this is not happening. Pinch myself hoping it’s only a bad dream.
Baggins,… As I said, once you start to separate these area, you will see a garden level is worth more than a basement and a garden level is worth less that above grade.
I literately just watched you be taught how to appraise and report !!!
And one more time…this is why the appraisal GODS have spoken !!! Those of us who have doing it by the “book” maybe someday wont have to argue what is considered below grade and what is considered above grade anymore.
I think you are man enough to tell everyone on this blog that you were wrong once you start to see the value differences within your market.
You jump all of the place when comment, try to keep it simple.
Garden level…what is cost to cure to make it above grade??? A back hoe and some grading and seeding. Then you can put in some normal size windows maybe, Then maybe you wont have some water infiltration issues or mold.
.
You NEVER saw the value difference because you weren’t looking for it, nor where you filling out the forms correctly.
And just to be clear, I am not talking about new construction units with a foot or 2 of ground against the house.
I know you are man enough to admit that you have been wrong. But it will take a few months…Get ready for your head to spin.
You really inferred many things which were not accurate what so ever.
Facts: Garden level windows are quite often the same size as mid and third level windows. And the rooms often have better functionality not less, because due to foundation thickness for our more extreme weather environment in CO, foundations are often several inches thicker than found in other places in the country. That is expressed with an increased cost basis in the M&S residential handbook based on location. We always apply that one add on for extreme climate. And the way the framing works for the interior, there is often a usable ledge running along the walls which face the exterior of the building. Really handy for plants, photos, books, pencils, gerbil cages, whatever.
There is no need for a back hoe because that would cut into the yard, the rear and front yards are generally level, except there is about a 3 to 4 foot earth rise somewhere along the side of the home. This rise may be substantial or it may be rather nominal depending on the lot conditions at the time of build. The volume of earth and sloping did not change any of the builders cost to construct or cost to finish interior areas. Regardless of slope or how much is partially below grade, the exacting height of the foundation and height and width and spacial volume of the home did not change.
Matching units of comparison. Finished areas track for more than unfinished areas. The garden level has equivalent usable area, equivalent functionality, equivalent finish, equivalent utility. That’s a simple concept.
Thanks for the grandiose machismo, because, that’s a real valuation skill right there. If only I was man enough… I blame the thirty thousand wimpy realty agents and thousands of other appraisers whom did it wrong before me. What do those local assessors know about the real property areas they manage. Nothing that’s what. We’re going to show them how to do this properly. Their local municipal codes on building spacial recognition do not matter and provide nothing in terms of reasonable guidance which the appraisers can rely on to be or become ‘geographically competent.’ Geography is a place, not a municipal guideline set forth by the local government body whom has jurisdiction in the area which describes and prescribes the exacting specifications for allowable building and structure development, including the subsequent recognition of qualifiable space reporting which taxation and assessed values are based upon. The very basis of market value benchmarks. We’re going to redefine that because we are simply better at this task than they have ever been.
Let’s jump back to the literal conundrums. Observe on pg 2 of the 1004 report ‘the grid’, the primary size of home adjustment line is specifically called: “Gross Living Area”.
If people spending all that time in finished garden levels are not spending time in the living areas, where were they?
They were below grade. The form clearly says basement and finished rooms below grade.
But wait, there is more! The sloping increase actually starts way in the back so half of the garden level is actually below grade, the other half is not. Should we cut the room in half for a more accurate description. I think sketches should include topography aspects so we can really get a better handle on grading and elevation changes. Lets add topographical surveyor to our list of specialties which drive valuation practice.
The common understanding of below grade is there being some condition where there is not an equivalent benefit of being above grade. Those areas indeed are likely to track with reduced valuation factors. And they’re less likely to have equivalent finish and utility. Where as the functional areas of bi’s and tri’s do not track that way, not around here.
Setting out with a preconceived notion is nothing but an assumption, a hypothesis. Why does the tri with 2k total living area & no basement sell for the exact same as a bi level with 2k total living area and no basement? Doesn’t the below grade area have less value? Isn’t the below grade area of the bi level twice the size of the below grade area of the tri? Shouldn’t the tri track at a higher price and value basis because it has less below grade area? Curious.
I think I may be able to figure this out but can’t quite put my finger on the detail… Because despite 20 years of professional practice without a single claim nor complaint, hundreds of independent requests for complex situations where I’m the only one capable and/or willing to provide the valuation service, excess references which I took my own website and marketing down because I could not keep up and referrals were enough, you know; I’m learning how to appraise as I go right here on this blog site. One of these days I hope to understand this incredibly hard to grasp concept of equivalent units of measurement alongside the principals of substitution. Dare to dream.
Definition of utility
(Entry 1 of 2)
2 : something useful or designed for use
3a : public utility
b(1) : a service (such as light, power, or water) provided by a public utility
(2) : equipment or a piece of equipment to provide such service or a comparable service
Antonyms: Noun
uselessness, worthlessness
Baggins… You crack me up. You have been preaching to the choir, half of us went over this more than 10 years ago. Maybe even 15 years ago.
But that was before The appraiser gods made ANSI mandatory.
So now it is time for the other half of the appraisers to catch up
You can argue until you’re blue in the face, how many shades of blue have you been over the last 30 days?
In the end your reports will now reflect the various levels that your different types of properties have.
It is up to you as the appraiser of how to value these varying levels, if a garden level is the same as above grade then just appraise it that way, it’s only the reporting that you will be changing.
I literally just watched you be taught how to report and adjust for different levels of a house.
Like I said my friend, you’re 10 – 15 years late to the party. We all went through this more than a decade ago. Like I keep saying, I am amazed you haven’t been called out by your lenders.
You can argue all you want, but when you separate your varying levels you will start to see the value differences, if in fact there is a value difference in Colorado and your marketplace. Only time will tell.
If there is no value difference, then there is no value difference.
Let us know, I am very curious.
Here in Pennsylvania a 2000 ft² one-story rancher all above grade, is worth more than a bi-level with a garden level at a thousand square feet and a thousand square feet above.
It is called functional utility, it is called curb appeal. Or design, or whatever you may call it in Colorado.
Here in Pennsylvania our split levels have three bedrooms that have privacy on the upper level, and then we have three rooms on the second level, kitchen, dining room and living alo above grade, and then when you go below grade what you call garden level we can consider finished basement, and we can also have an unfinished basement completely underground underneath the kitchen living room dining room level, we just report whatever is below grade and value accordingly.
So when you tell me a bi level is the same as a split level, in my state split levels are superior because the upper bedroom levels have privacy from the rest of the house even though they’re only five or six stairs raised above.
Split levels of superior to bi levels for this reason of superior functional utility, or privacy. You can walk to the hall bath without having to put your clothes on if there is a party going on on the second floor, unlike a bi-level party where the bedrooms are located on the kitchen living room dining room floor.
It is not a big deal. Your previous posts were reading like there was a cabal infringing on your human rights and freedoms to do what you want, when we are just cogs in the big machine of lending in this country, and the appraisal gods want conformity across the board and may finally end the argument with loan officers and real estate agents and the laymen’s about what actual GLA is and what below great area needs to be reported as.
We are not to conform to assessors or to real estate agents or to builders.
That is your biggest misunderstanding.
For somebody who doesn’t want to to conform to ANSI, You have been preaching about conforming to assessors and builders and real estate agents.
For whatever reason you are 10 to 15 years late to the party is the reason why the appraisal gods have spoken about measuring to ANSI.
And if you’re that good after 20 years, my friend, think of how good you’ll be after another 10 years.
I have 30 years under my belt, and it is time to retire at the age of 56, I am relocating out of this country, I have had enough of this country and the nonsense of the last 5 years, I will be relocating to Asia, living the dream raising exotic fish and bird, living with fresh produce and fruit grown on my land, with fresh eggs everyday, no snow, and no headaches from doing appraisals. I plan to spend 30 days in 2 – 3 country every year that I can and live with the locals and drink their coffee, eat their foods and drink their wines and laugh at their jokes.
I have made a lot of money as a real estate appraiser, but I have given up So much of my life in return, I have seen amazing properties I have met amazing people of all levels and of all lifestyles all over Pennsylvania New Jersey Delaware Maryland.
The post I have read for this blog is a reflection of the problem in our country these days. What I hear is… Me me me. And not us.
We used to say to pledge of allegiance in school, One Nation under God, with liberty and justice for all.
Those words don’t apply anymore.
The Statue of Liberty… Give me your tired, your poor your, huddled masses yearning to breathe freedom, …..
Does not apply anymore.
A woman’s right to choose… Does not apply anymore. To a certain faction of our country.
Take the statue of Liberty down, it does not apply anymore to a certain faction of voters in this country.
We are in an uncivil war, the South said it …they will rise again, and here we are today, in an uncivil war brought on by bigotry and racism and white nationalism.
Our constitution is under attack, our Supreme Court has been infiltrated by dark money with an agenda that has not been exposed yet but will be sooner or later.
America’s politicians are bought and paid for at the expense of common Americans, high price of healthcare, high price of pharmaceutical,
The continues lies lies told by ring wing media pretending to be news agencies All in the name of advertising revenue and something more to come
The separation of church and state no longer applies.
Stage one of the dumbing up of Americans is now complete, stage two is now the uprise of authoritarians, phase three will occur when our once great country goes to another great depression.
The oligarchs will lower wages back down to a dollar an hour, they will buy up commercial residential and industrial real estate for pennies on the dollar, and when people are standing in bread lines they will not say a thing.
I wish you would put your energy into something more important than a standardization of measurement for real estate appraisals.
Thank you. What you observed with the grid work theoretical stuff was expressions of the difficulties appraisers would have if the assessor did not provide garden level breakdown and there was no other verification source. I was not learning how to do anything but some meaningful insight was gained. Sometimes the rubber must hit the road and the pen must be put to paper, for theoretical expressions to become measurable to see if postulations may or may not be true. I did certainly prove the net/gross dilemma which was my primary goal.
The notion of conforming to local standards is rooted in the very thing you talk about, upholding the rule of law and local jurisdiction in our local communities. You can’t give up one liberty and embrace another. Or claim this due process applies but that one does not. It’s an all or nothing proposition, the notions of law and order, equal representation, due process. Also, it only makes sense to make use of existing municipal guidelines because there are better redundant data verification sources. That is in fact, why so many others utilize this uniform approach. Being on the same page in terms of units of measurements has it’s benefits.
I’m not giving up.
Baggins… I love how you write, I consider you one of the most intelligent people on any of these blogs and that is for as long as you’ve been on these blogs for.
Yes, the more you separate these areas the more you will see, I do not mean to insult, sometimes you got to get somebody’s blood boiling in order to break the mold.
We here in the Northeast of the country rely on ourselves for our GLA’s and our below grade areas, sometimes the assessors are correct, half the time they are incorrect, it is due to them hiring for mass appraisals at $8 an hour drunken fools who are still hungover in the morning at 7:00 a.m. to measure homes in the counties that are going through reassessment with mass appraisals.
I know this because I worked a few months with a nationwide company doing mass appraisals, at times the managers assumed there were only three varieties of split levels and I had to argue with them that this was a fourth variety.
A recent Mass appraisal and one of my counties the company rounded every figure up and did not measure every wall, I have seen reported assessors figures incorrect by over 10%.
You will not have the problems that you are imagining that you will have with reporting different figures, it is not that hard to do once you get used to it, it is basically simple math but you have to use a calculator and you have to use some intelligence but it is not impossible to get close to an accurate figure to then make your adjustments.
My biggest complaint years ago about the management companies, after I called 180 appraisers trying to get them to unionize so that we would not be taking advantage of, I heard the same story from all of them me me me me, and that’s what I continue to hear today, me me me me me.
Moving to ANSI we’ll lead to the real estate classes teaching would we appraiseers need to know when realtors measure houses, it will finally get better.
And yes it’ll make us appraisers easier to replace.
So be it.
Good thing we do not have those problems around here in this state. It is very rare for assessment figures to not be accurate pertaining to their specific building code specifications. We are far more to the same page of a uniform standard than it appears other states are. So much for all that progress!
Would you still have the same position if in your area, things worked smoothly? I get the point that in some areas, it’s a mess and corrections need applied. Is it fair representation and equal representation for a new standard to be applied which creates far more disruption than the current system in municipalities where the stated has already been achieved? Let’s consider the frequency of out of state flatlanders needing to come here to measure properties with THEIR standards, rather than ours. Minuscule.
Principals matter.
Thanks for the compliments. The hardest part about being exceptionally intelligent is finding ways to express and convey theoretical concepts to those whom don’t want to hear it, but rather are more interested in supporting the current thing.
If my blood boils, I won’t be on these blogs, that’s for sure. And I don’t take any of it personally so don’t worry. Say whatever you feel like, it’s all good with me. Truth is I’m just a regular dude trying to get by and work smarter not harder. I don’t care if some standard brings this or that, because if it’s not commonly accepted as the status quo, other professionals and market participators will not be on the same page as me. Optics matter too and everything real estate no matter how you slice it is some form of a team effort.
Picked this one up from the appraisers forum back in the day. Cheers.
You know what I want to hear about being exceptionally intelligent, sir yes sir, if that’s the way you want it done that’s the way I will give it to you sir !
I am so tired of the cry babies in this country, our parents generation were men, we do not have men anymore, this country has it turned into a bunch of crybaby little girls.
The Nazis are winning !
This is so very simple, and it pains me to see this forum deteriorate into a pissing contest. The problem is not ANSI, and there is nothing wrong with having a measurement standard for us all to follow (and learn properly). The problem is the trickle down impact and the dumbing down of appraisers when forced to keep inventing disclaimers and scapegoat clauses because of an industry that has found it so very easy to sucker appraisers into accepting the responsibility and liability for all the others in the food chain. They have already succeeded masterfully in the evolution of the appraiser / home inspector / engineer/ environmental specialist / water heater installer / smoke & CO master, so it is a small stretch to expand those liabilities into an architectural arena. There is nothing really so difficult about ANSI. The difficulty is our liability for making a supposed market reaction adjustment that all readers are conditioned to, and with great anticipation, expect to rely on, and the forces that require a credible report…… when we are knowingly creating a misleading report with every adjustment that we have no way of proving accuracy.
That’s right Doug. The appraisal grid is strictly for market reaction adjustments.
Add topographical surveyor to our list of specialties.
“You only need to measure subject to ansi, not your comps.” Who threw centuries of sound mathematical theorems for matching unit comparisons in the trash can?
Get ready to buy more books! The unelected special interest ANSI working group which consists of 15 people, which apparently now influences policies for this whole country and usurps all local municipal guidelines and jurisdiction, is going to sort out some of the fine details in the next round of book sales.
Every time without fail. When people use the force of government and deny individuals the ability to choose or not to choose voluntary engagement. It’s an unmitigated disaster every last time. Some people never learn.
AMEN!! SO WELL STATED. Thank you
Well aren’t you the GO FNMA/ANSI guy here! LOL …
First unless you are a Realtor you can not possibly know the state of a Realtor’s training. I have to laugh at your thought that Realtors will ever measure by any method other than “the owner stated” GLA just as they do now here. Realtors do NOT want the liability of ANSI. They are too hands off for that . They don’t even meet their clients for contracts…DOT LOOP. IT so much worse than it has ever been.. So you can count them out for ANSI. The training is brief on the subject of appraisals and they are taught GLA. But even with MLS trying to get the reporting more accurate Realtors still count below Ground level rooms and bathrooms in the above grade room count.
I speak with both Real Estate and the Appraisal Code enforcement fairly often. I was told that the last 2 years had record complaints…..Appraisers against Realtors
Second MLS does not require a whole lot from Realtors. Core logic is an advertising form. They would like agents to be honest and not misleading but they do not check to see if they are. Other agents are supposed to watch dog the listings for accuracy and then send a flag off to the MLS team. Once they are sold there is nothing done at all.
MLS does not have to worry about accuracy cause they are not entering anything.
In my area the MLS stopped the ” Coming soon” because the agents here abused it so badly that Core logic stopped it. But the Board President in his monthly news letter told all the Realtors in the Association to ignore the MLS as to ending coming soon , keep doing it and just get the owners permission. !!
Now I am a little confused about the bathroom adjustment comment you make here. Care to elaborate?
I strongly agree that it is going to take time before this is accepted and done. And that “one day ” we may see more use. OR FNMA will change their mind AGAIN and do something else. OR ANSI will update again and include GARDEN LEVELS in GLA. …
I also agree that there are many Appraisers who could benefit from a second course of the basics . Many did not do much as far as training and just got licensed with very little education. Many were not properly trained.
The Auditor’s cards here are a basic out line sketch so its not worth steeling for anyone. Anything prior to the licensing of these guys, is not accurate at all a lot of the time. Even with floor plans they were inaccurate. Untrained and did not know how to report GLA or Sketch and sometimes included the GARAGE in GLA !!
The auditor here get the information from building plans when the permits were applied for in the first place. Here all the construction (and I imagine the entire US ) had the blue print or plans filed and all of the information for construction was given to the Auditor. So at the time the info was fairly accurate with the exception of the sketches. It’s the homes built before the plans were required that are pretty far off, anything since the Auditor’s appraisers were required to be licensed is far improved. But they did not get licensed here until about 2012 or after.
In a small City here near me the building Dept told me they check MLS sheets on every listing in their little City. The they add all the info from the MLS in their files. Now that is REALLY BAD cause the Realtors embellish so much its ridicules!!
I am sorry but I don’t agree on Appraisers being “cry babies” The lenders and AMCs don’t want to pay what appraisals are worth IMO. Then they ad more time for the job. Just try to get more money!! Never happen…Did any AMC/Lender add a few bucks to the fee when gas went up by at least 50 % in the past 6 months?
I added a few dollars and stated due to gas prices I had to increase my fees slightly. TALK ABOUT CRY BABIES!! They cancel the assignment every time.
Now a lot of people will need more time for ANSI. FNAM acknowledges this and says to just add to the price. LOL …..
So just because there are people who are concerned, feel they are already underpaid and are also not knowledgeable about things like stairs and NON GLA on the GRID and other things the ANSI method explains in a way that can be hard to understand Does not mean they are “cry babies” DOES not mean they were not measuring to a standard. I am sure they were or they would have been fired and retired. The ANSI stair instruction is so confusing that even instructors are not getting it correct. I have seen a lot of confusion on the 5 ft ceiling as well. I will bet you a few bucks ANSI has to change some of that verbiage because it is conflicting in some areas.
So all in all it is human nature and a common reaction to get stressed and even complain when things change. Since the lenders blamed the entire Market Crash of 2008 on the Appraisers even though they came up with the NO DOC NO INCOME VERIFATION LOAN (which really caused the crash) why wouldn’t many appraisers be upset now seeing this confusing language and direction.
JMO
What is confusing about stairs and the 5′ ceilings.
No space under a ceiling less than 5′ counts AND you need 7′ ceiling that accounts for 50% of total sq ft of the room. IOW a room with a flat 5′ ceiling is not GLA. It has to have a 7′ height. It can have a 14′ height but the 7′ line has to make up 50% of the room measured from the 5′ high width.
Two measurements 5′ wide AND 7′ wide.
7′ measurement needs to be at least 50% of the 5′ measurement.
As to stairs. Just pretend like they are a pull down attic stair. Except stand on second floor and pull the up to close off that space. Just pretend like it’s flat floor. I don’t know why anyone gets confused on that.
Tom,
I have been using this method since I began appraising. I cannot say that ANSI has explained the entire method in a clear and concise way and after reading quite a few posts across all sites, it is clear that no one can say it is simple.
It may be no big deal to a few people but as I stated, even people we would expect to understand this clearly do not. There’s confusion on low ceiling height in Stair wells being counted per some people. Some people do not understand the lack of considering stairwell area to attics. Some do not understand if the rise area is to be subtracted or just the base area of the stairwell. I have read all of this and more. I cannot believe you have not read or heard of many of these people stating their confusion on the Stairwell issues. There is more than one article and/or blog on these things. So, I am certain I am correct in saying many find it confusing and even people who have taken (and some who even teach) the classes, have the book, feel it is confusing. Evidently there are some people who have not read these posts and articles, yet I guess.
Many people are not so short sited that they cannot see that uniformity cannot be established without full and CORRECT understanding for compliance.?
There is also a lot of confusion on the ability to separate out and grid and adjust for under 7 ft and then 5-ft areas. There are a lot of people living in these homes that do feel those areas do not have a separate value. These homes are priced apples to apples, and you cannot use another style to extrapolate the answer here.
If you feel the under-five foot has a value, then may I ask where do you obtain that value from MARKET DATA? So, does the value at say 5 ft change for areas at say 4 ft? At 2 ft? Are you doing height x weight then, Volume, cubic Sq. ft? If you feel it has NO value or if you decide the value is equal… where is the MARKET DATA to SUPPORT that conclusion? I honestly cannot tell you what the answer is to that because the market as a whole has never given an opinion on that in my area that I am aware of. The homeowners use the areas for beds, dressers, shelving and a lot more. The builders built and sold these homes with these areas as useful areas and did not have per sq ft prices on them differing by the height of the ceiling area or slope. The Auditors here have seemed to use 50% or 75 % of the first level to determine GLA in these homes. No where can I find a 2 or 3 different prices per sq foot value on these areas. So, 7′ is one value 5′ is another value and the below 5′ ft is yet another value or no value at all or any combination of that theory anywhere.
I am sure there are people who have other things they are confused about or need clarification on.
So yes, for many people it is confusing. I might add that if people are trying to follow appraisal 101 and USPAP and AI requirements it should be confusing ..JMO… cause there is NO mathematical answer for some of this yet and no data on it yet that is reliable enough to separate out, grid and adjust as FNMA requires.
In my practice I simply followed the GLA of 5 foot and over being counted in the GLA. The rest was not GLA and the total GLA did not include it. AND yes there are a lot of people who see it that same way…right or wrong.
I get the impression from the comments here that you and several others were already using a separate area in the grid on the URAR and a separate value 0-whatever and adjusting (or not) these areas. Then following that with comments in an addendum to explain and defend for a long time before now and perhaps your entire career. That is tremendous forethought on your part. It surprises me the QC’s understood what was being done even with comments. Just saying..
Not everything has a value/or no value to everyone and not all of the MARKET has the same opinions. I think we all should be able to agree on that.
There are a lot of things, types of construction, amenities and differences in this industry and all others that just cannot be brought to an absolute, supportable and valid conclusion without a lot of research and supporting Data and some not even then. IMO
The market sees these low ceiling areas as nothing more than a place to put short drawers, a rod to hang clothes, shoe racks. No human that is above 3 feet tall sees these areas as usable space and there is no possible way to prove a value to these low ceiling areas. I dont get the confusion and worry. Appraisers should be using the same general style house with the same general low ceiling area therefore there is no issue with reduced living areas. THe people are already living with “reduced” living areas and have, as I said, use the areas as finished storage areas. By using ACTUAL comparables, this presents no problems at all. Same thing for split/Tri/Bi level houses. Below grade is basement, use comparables with the same style and there is nothing to worry about.
Great Chis if this were a cookie cutter world, or you could see inside closed walls to make sure ceiling height was the same as your subject or maybe less than the required sq ft to be counted then great, but we can’t. If you know for sure that they are equal well then, your methodology will certainly work. ANSI does not tell us to separate out the GLA finished and the non GLA finished areas, grid and adjust. FNMA is directing us to do that. This cannot be done and/or is not accurate because you cannot GUESS about ANYTHING YOU CAN NOT PROVE in Appraising. It is just that simple. Your extraordinary assumption would be made on what FNAM has stated is the MOST IMPORTANT thing in Appraising. If you disclose the lack of accurate GLA Data and/or specific knowledge to your client prior to accepting the assignment, they will say PASS and give it to someone else. Remember “report and defend” and “results another can duplicate” and finally that the “reader of the report can understand what you did and how you arrived at the results.” Where ya gonna put “I just guessed “??
Anyone can come to different results than yours doing this. (And you said no wonder they want to get rid of us) It is ALL just guessing without inspection or reliable DATA. Now I CAN NOT Believe YOU do not get this concept…. just saying
Am I wrong stating that you feel it is appropriate to base and report a conclusion on “typical” rather than fact when appraising? Please help me here because I simply do not understand your position. or your judgement of others here.
Side note…. Some of my family lives in Japan. It is Beautiful there! Cherry Blossoms soon!
BA,
What Chris said re 5′ ceilings. I said way back I have been maybe 95% ANSI for ages. What I have done in the past is usually when a room has some built-ins below the 5′ line, I would measure them in and make a comment. Now I would just put them on a different line. The adjustment can be depreciated cost or hopefully you find a comp or two that has similar built-ins. You would still be comparing like items.
As to the stairs. It doesn’t matter what is under the stairs. It could be a closet with a 4′ ceiling. It could be sealed space.
Very simple. You have a two story home. It has a 15 x 4 staircase. The opening is 15 x 4 as well. Under those stairs on the first floor are a return air vent for hvac duct work and a closet with a 4′ slanted ceiling., as well as some sealed areas with finished drywall, etc..
Ok, here is the simple part.
1. You count the stairs from which they descend. ok that’s 15×4 for Level 2
2. You count the “floor” below them. ( not the hvac duct, not the closet, not the sealed space )…. The “floor” those things are built on. That too will be 15×4 for Level 1
So level 2 and Level 1 will be exactly the same measurement for the stair section. No worry of closets, ceilings, etc. They do not exist in context of a typical set of stairs.
3. If you have a finished set of stairs going to an unfinished upper. They too count.
EX. You have a Ranch with a massive attic that was built so that if desired it could be expanded. The main level is ornate, the stairs are a focal point. So in that case those stairs would be the only thing counted from the level from which they descend. All else up there is unfinished.
4. Basement stairways even if unfinished get counted in the floor they descend from.
All this stair info is located on page 5 Annex. Last paragraph left column + 1st top paragraph right column. It’s basically all stated in one paragraph.
Speaking of people teaching real estate appraisal. I was watching a really good video yesterday of an appraiser teaching a group of agents and brokers. This person got to one part and said I’m not a fan of regression. He was at a class and someone walked in one day and said I used the analysis and it told me a half bath was worth $75K on a $200K home. the instructor said “Maybe it is” … at that point he said the instructor lost all credibility with everyone in the room.
Nothing in appraisal works every time. However we can all measure what we see, as it sits, to a national standard. It’s just not rocket science.
To answer your question. No, have not read other forums about these issues. I somehow got an email about this one and just stumbled in.
Tom
“Close” only counts in Horseshoes. Without full compliance it is not ANSI. At Least that is what is being directed through ALL of the materials and education. So, like all of the rest of us…you were not measuring to ANSI compliance but you both feel or seem to say that your method was good and also reliable for all the years of your career (which I totally feel is true and correct) JUST NOT ANSI.
My guess is Chris was not ANSI compliant either. My point here is to say in the kindest way possible that there is a lot of judgement floating around in the past few months being passed on people who could not say they were “ANSI compliant.” With deeper clarification we see that really probably no Appraisers were ANSI compliant. Few if any appraisers can claim they were ANSI compliant before 4/01/2022. The Veterans never saw a reasons to “improve the way they measured and felt it was good enough to do 100s (maybe 1000S) of appraisals with their system. NOW all of the sudden no questions… ANSI is the end all be all even though it was revised in 2020.
Now just my opinion …if you have been comfortable in your practice and felt good signing your name then how can you simply and automatically accept a NEW standard that states your whole practice was not reliable and all of your reports were not properly completed?
Sorry I am just not with you. I believe ANSI does not follow Market reactions and for me in appraising MARKET reaction is mandatory for accuracy of value. GLA IS NOT the most important thing to buyers and the DATA supports that conclusion. So, while ANSI may be the most accurate way to measure something it does not give the PEOPLE that are the MARKET any weight in what the market sees, accepts or wants. ANSI …. ITs all about a measurement. Appraising is so much more than that.
“The homeowners use the areas for beds, dressers, shelving and a lot more. ”
That is a clue right there and market data. Ok, let’s deal with it.
ANSI My room 5′ to 5′ is 8 x 20 = 160sf
ANSI My room 7′ to 7′ is 6 x 20 = 120sf — this figure is over 50% of 5′ size so the 160sf is Fin. Sq. ft = GLA
Market My room is 14 x 20 at floor = 280sf 280 – 160 = 120sf finished area.
Assessor – They simply measured the lower level at 14 x 20 and called it a half story. 280/2 = 140
Agent 1 — Tom!!! You are fn CRAZY. EVERYONE PAYS DEARLY for that entire room. OK, OK, relax… all I asked you was did you measure wall to wall. It looks like you did. YES!! Where else would I measure from… Ok, that’s good, I just want to be sure I don’t short change anyone on my subject.
Agent 2 — Hi, yes we measure from the wall. They have two beds in there and some nice built-ins. It’s very popular to maximize that space and people have no issue paying for it regardless of the ceilings. Lots of kids here because the schools are rated highest in the state.
Agent 3– etc..
OK… back to my GRID…
My floor area is 280 and that equates to the market.
My GLA is 160 and that is ANSI compliant.
I add a line.
ANSI Dim. Area ( ANSI Diminished Area )
I write a disclaimer / description explaining the difference between ANSI = GLA and Market bought/sold finished area.
ANSI Dim. Area | 120sf| Adj = 120 x whatever the GLA figure is. Yes it will be across board plus. Not my problem. All accounted for.
More importantly any other appraiser that can read a ruler could get similar results. A reviewer in Hawaii could understand the measurements as well the valuation reasoning. IF they got two more appraisals. The other guy might have measured floor to floor. His and my values will be similar but our GLA will not. The third gal that measured used the assessors standard. Now the reviewer has three different GLAs AND this last person will have a different likely lower value.
Three GLAs – Two Values. Had appraiser 2 used ANSI the reviewer would have
Two matching GLAs – Two matching Values, Then the third report would be smaller and lower. If the third converted to ANSI and actually measured all the space the reviewer would get 3 = GLAs and very likely 3 similar values with that oddball low value no longer present.
The above scenario is what has been happening in the ERC community forever. I stretched it a bit. I don’t think anyone appraising in ERC could actually get away with simply copying assessor records.
Generally speaking most of the homes I measure the 5′ mark cuts out just a minimal amount of square footage. The builders are trying to keep those rooms as large and functional as possible. Then you often have a dormer. So the below 5′ stuff is often minimal like 15 to 20 feet maybe.
All that area under those stairs counts for that floor. You can see the ceiling height is under 5′ but per ANSI the stairs have taken president over that area. The important part is you don;t cut it out.
How you value it is up to you. You might give some extra value for the built ins.
Basement Stairs
ANSI
“Further, stairs that descend to an unfinished basement are included in the finished square footage of the first level regardless of the degree of finish of the stairs or the degree of finish of the area around the stairs.”
The comment about area around them means unfinished walls, no walls, etc.
Let me paraphrase ANSI. Even though they explained it all in one paragraph very clearly.
Don’t diminish your floor level square footage due to stairs. Stairs take precedence and can only make whole a given level.
unfinished basement stairs counted with first level makes it whole.
a stairwell in the foyer of a two story home is counted on level 1 and level 2 to make each level whole.
Stairs don’t SUBTRACT they make the Level whole.
The finished stairs to the unfinished attic is only exception as it is a feature that needs to be ADDED to overall square footage but since the First Level is already whole you consider it as the only finished space from the Level above. The Level from which it descends. This convention ANSI has used here is not something new. The concept has been used in music theory forever.
You will never find someone communicating a Scale as
A A# B# D E F G we have to work with the notes A B C D E F G and their sharps and flats. That scale would be written A Bb C D E F G — notice the latter employs one each of the notes A through G. To you ear they are the same notes but the first one would be a nightmare to communicate and read / write on a sheet of music. Playing it will sound the same though. ANSI is trying to do the same thing with a strict method and not intermingling items and features.
“There’s confusion on low ceiling height in Stair wells being counted per some people. Some people do not understand the lack of considering stairwell area to attics. Some do not understand if the rise area is to be subtracted or just the base area of the stairwell.
ANSI
This is what they write as final sentence in the section regarding stairs. It is a separate comment that stands on it’s own.
“In addition, areas beneath stairs are included in the finished square footage regardless of the distance between the stairs and the floor below or of the degree of the finish of that area.”
IOW….. if there are a set of stairs they tell you to treat the area under them regardless of what it is as finished square footage. That’s because they know the stairs need structure below to carry them AND the stairs are expensive AND more than likely anything under them is going to add even more expense.
If this stairwell were going to an unfinished attic it would count as all of first floor PLUS the size of that stairwell ( the opening to carry the stairs, not to exceed size of stairs opening. )
These stairs should be measured and reported however ANSI does not apply.
The lender will need 3 sales and two listings with a similar feature. All to have closed in the past 7 days.
Thank you I NEEDED THAT!!
Makes sense that we appraisers accept responsibility for accuracy in our own work. No problem, and always have. My problem with mandating accuracy from the appraiser rather than consistency with the market is that now, in addition to being responsible for our own methodology we have evolved into accepting responsibility for the methodology of others the moment we make ANY adjustment for differences in GLA from subject to comparable. The result, of course, is the simultaneous evolution of Scope of Work disclaimers that effective lessen the ability to rely on ANY appraisal.
Agreed.
Time for beds and MEDS!!!
This blog should have been a great learning place, and a series of comments and thoughts that needed to be required FNMA reading as well. Seems it has turned into a rather long pissing contest between just a handful of appraisers leaving Great American Novels rather than constructive, courteous, and meaningful messages for the benefit of us all. This is NOT all about ANSI, and the use of ANSI standards is not the issue at all. The issue is the trickle down liability by adding responsibility for the accuracy of others to the already overwhelming list of non-industry standards we have been forced to adhere to like building inspection, water heater installations, smoke & CO alarm functionality, architecture, environmental hazards, mold expertise, and on, and on, and on. Personally, and I believe universally, since April 1, 2022 we have exponentially increased exposure to liability and sanctions each and every time we make a GLA adjustment between our subject and comparable sales we have never inspected personally…. knowing full well the result is thus intentionally misleading.
I have never heard of an appraiser being sued or sanctioned because they’re off a little bit on reported GLA by assessors on comps or even the subject. The powers that be understand that appraising is not an exact science, we are only good as the information provided to us and we have our disclaimers buried within our reports.
According to all of this ANSI is not a guess it tightens the RESULTS and definition of GLA like never before. In this case the information reported is BY US. ANSI IS A Science the way FNMA is applying it. Chris all along you have said we need a standard method of measuring; I agree but the STRINGS attached to this method by FNMA do not ALLOW for error. I agree with Douglas.
” I agree but the STRINGS attached to this method by FNMA do not ALLOW for error.”
Please give an example where FNMA states no errors are allowed in the measuring process.
ANSI Z765 is a measuring / classifying standard for single family residences.
Please describe the strings FNMA has attached and where they say no errors are allowed. I’d like to read that so that I can be sure my disclaimer covers it.
THIS IS WHAT WE ( others are talking about)
DIRECTLY FROM FNMA SITE AND GUIDE
“The appraiser’s adjustments must reflect the market’s reaction (that is, market based adjustments) to the difference in the properties [of chosen comparables],” according to Fannie Mae.
Instead, Fannie Mae expects appraisers to analyze the market for competitive properties and provide appropriate market based adjustments “
MARKET BASED ADJUSTMENTS ARE NOT AVAILBLE AS THIS HAS NEVER BEEN ANALYZED AND WAS NEVER PART OF THE APPRAISAL PROCESS PRIOR TO 04/01/2022. ALL that was required was GLA and non GLA not non GLA finished / unfinished and all of the rest WITH A MARKET REACTION ADJUSTMENT in the GRID.
SO there it is WE are not talking about ANSI just as DOUG stated. This is NOT ABOUT ANSI so get past that part. OR don’t .
I’m back to thinking trolls OR FNMA REPS visiting here. GO FNMA…YA
LOL
I’ve posted several text book examples of how to do this.
No I do not work for FNMA. Do you need to see my tax forms?
“SO there it is WE are not talking about ANSI just as DOUG stated. This is NOT ABOUT ANSI so get past that part. OR don’t .”
Oh, ok, my bad…I thought the title of this thread was…..
“ANSI Measuring Standard Required in 2022”
ANSI Measuring Standard … I wonder what that could be about. I didn’t realize this was a FNMA Valuation thread. Thanks for clearing that up for me. I’ve been in the wrong thread the whole time.
Tom,
I understand your point. It seems though there has been a lot of talk about GLA and garden levels for days that went nowhere and a lot of repeated information on how the method is performed. Every time I bring up anything at all that questions DATA and how to get these adjustments that FNMA requires with this new requirement, I get crickets.
There have been several things that I am sure you spoke on that were very helpful to people reading here. But you refuse to accept that no matter how you repeat the methods there are many people who are NOT comfortable with how FNMA is directing us here and adjustments are a big issue and so is accuracy,
It is a thread for the discussion of ANSI but the entire situation is not only ANSI and as GOOD as you wish to make it sound this can be very harmful if all we as Appraisers concentrate on is method.
You and Chirs seem very hesitant to have and communication as to the concerns others have. “We’ll get used to it” as you and Chis have but neither of you have been ANSI complaint any more than any of us have been cause partial method is not complaint.
I don’t know CO and I cannot without market knowledge and experience address whether something is market reaction or not in CO. ANSI does not address this very important component of the process so it is very flawed for our purposes of Appraising. As I said there’s a lot more than just accurate GLA. Yet time and time again a guy from PA and one from VA are Criticizing a Veteran Appraiser with out even considering the Market acceptance of his area being a very valid point.! I have been agreeing with a standard method just not with the direction on adjustments. Every question I ask gets the same response which is the direction on 5′ ceiling height and stairs …which I have repeatedly stated I have always been competent in completing. The answer from Chris on adjustments was basically its no big deal…??? You suggested several things in 1.5 stories 5′ ceiling height including add the built ins even if below 5’and comment on it . This voids the ANSI method completely so I really do not understand your thoughts here. You also suggested being familiar with the area and the style as acceptable but we do know that is NOT ok with FNMA or any standard at all. Don’t you think we should pursue more conversation on what is not known and less on what the book demonstrates? Things that are in conflict and not things that are not the issues but are being overlooked that are the real problems?
No need for SS here but no need for hypocrisy either just saying…
I mean really when Baggins was being arbitrary in your opinion didn’t you suggest he was a troll? So why not see you may be coming off as a little too PRO FNMA that you cannot even see any downside here. All of your post suggests there is no downside. When someone brings one up you dismiss it with ANSI direction. Come on you are much more rounded than that I am sure. Think about what others may want to discuss here too. You may save someone from a big mistake and if you are open minded someone may just save you from one. You NEVER KNOW.
This is all just my opinion, and I certainly can not claim I am never wrong can you?
“but neither of you have been ANSI complaint any more than any of us have been cause partial method is not complaint.”
Not true.
1. I have not idea nor do you what Chris has done.
2. I never said or have told anyone I have been ANSI compliant other than 95% there.
a lot of my work gets compared to one or two other appraisers at the same time. It is then reviewed by an appraiser. the reviewer is out of state. So two to three appraisals in realm of one week on one property reviewed by an out of state appraiser that for all I can tell over the course of 38 years has their shit totally together. I have the utmost respect for the reviewers that call me and want me to verbally defend my opinion and/or consider some additional information.
A: If you have a problem with Chris go talk to Chris. You are correct I dis agree that things below 5′ have no use and value. That’s where I live. I don;t know where you live or where he lives.
B. You suggested several things in 1.5 stories 5? ceiling height including add the built ins even if below 5’and comment on it . This voids the ANSI ……. NO NO NO.
I said up until now I was 95% compliant and I could deal with that situation as I thought made it easy to understand within the context of the limited narrative area of the FNMA 1004.
What I am saying is that now I will simply go strict ANSI and narrate that other stuff elsewhere. Let’s face it . FNMA sucks at designing appraisal forms. All the good stuff is in the narrative.
A specific ceiling height NEEDS to be set as a minimum. To me it should be the standard 8 feet. How would you feel about an entire floor being 5′ high? Would you pay top dollar for that? NOBODY would. In order for there to be any kind of appearance of professionalism there NEEDS to be a standard. This is SO obvious by this insane thread of comments here. Every house need to be measured the same no matter what part of the country it is in and no matter where the appraiser is from. There needs to be a minimum ceiling height. I have been in houses with basements (FINISHED) that have 5′ high ceilings and it is not at all usable by the typical adult. This should make ABSOLUTELY no difference in the appraisal since you are using similar styles and floor plans. Unless you are trying to only use sales that are not at all comparable there is no reason to complain, worry and vent over this.
If we are going to bring me into the loop, my opinion is that the key word in the thread is not ANSI. It is the word REQUIRED that concerns me with every single adjustment I may make from now on….. or not. You give me three ANSI proficient appraisers and one house to measure with, say, six sides. My money says all three will have different answers and if any of them are within 1 square of accuracy, or even of each other, and I will show you a rigged election, not an accurate one.
Yeah…. you are over thinking it. Of course they will be different. To a minor degree.
That’s what FNMA has said. They get results Waaaaay out or EXACTLy on.
If you take ten appraisers on one house with ANSI you will only get minor human errors.
You just nailed it!!!
Thank you!!!
….. accuracy within 1/10th of a foot per measurement, and within 1 square foot overall leaves plenty of room for error? What am I missing?
Comps less than a mile away.
Comps under 90 days.
Snow surrounding the exterior of the building.
About a hundred other things.
The standard is not that you must be accurate (0.10) and precise(0.10 of actual).
The standard is … record and present your measurements to ( 0.10) regardless of how precise you may be able obtain.
You will not always be able to hit the bullseye but we can measure how far off the bullseye you are to the 0.10 of an inch.
I measure the house 24.7
You measure the house 24.9
Next 24.6
Next 24.8
Next 24.7
Next 25.5 — Winter in the snow
Next 25
Next etc..
Take all your measurements.
24.7 x 53.2 x 25 x 53.5 = something close to 1325.748
Rounded = 1326
So the next guy has 1324, 1330, 1320
That is Waaaaaay different than saying well I’ll include that open foyer.
Now he has 1424, 1430, 1420.
Oh and teh 200sf family room open to below
Now be has 1624, 1630, 1620
What you are missing is 1326 you got by ANSI as best you could to the 0.10 inch and 1630 by not using ANSI….. that’s 300sf. Could be an issue.
Doug….They are crying because they now have to measure the subject, they will now have to think about the comps GLA and estimate instead of just using assessor data. Things us real appraiser have been doing most of our careers. Others are trying to tell us its an infringement on their rights of independence. Others don’t want to change. Others just don’t want to get with the program. And some others are just not smart enough to get the bigger picture. Realtors and laymen will now know how we have to measure and all the phone calls about discrepancies of GLA will be over….
BA….most of us have been doing this for 30 years…those of you who have not will get used it it… it defines what “livable space is…no more 5′ ceiling counted as GLA, which they should never have been….for obvious reasons… They define what an finished attic is now..No big deal, give it was much value even as much as GLA if that is what the market does. No big deal…No more appraisers using gross building area instead of actual GLA…No big deal…..People just hate change..that is all this is..,,,its not a big deal.I for one am glad its finally here. I am sick of having to explain this to dozens of people every year. Now the realtors will be taught….YA !!!
You don’t have to be ANSI compliant with the comps, Do the best you can…this is just a standard of measuring properties…here are the highlights….
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.
Do you understand that GRID adjustments are data driven? So yes ANSI is fine but once you start using a standard method of measuring claimed to be the most accurate you accept the liability of error. Cause the method if done correctly is accurate to a VERY SHORT degree of error. Again back to the Data THERE IS NONE for these things and won’t be for years if ever. IT DEPENDS ON THE MARKET AND MARKET REACTION. Not anyone’s opinion.
REALTORS WILL NOT BE TAUGHT ANSI . TOO much liability!!
I have been measuring 1.5 stories correctly all of my career and doing the stairs as required as well. SO PLEASE STOP disregarding this! You are not the only one here who was measuring these things correctly. You are very degrading when you act like no one else was as good, smart or accurate as you. There are and were plenty of us.
Finally unless you did all of this for all 30 years and I don’t think that is really accurate, due to the 2020 updates …YOU were not ANSI compliant. Sorry not my word ANSI’s.
We need to move on to something we can all learn from instead of the same Ol same Ol over and over. Let’s talk about MARKET adjustments and the Grid and the things many of us are concerned over that you really do not seem to want to address. ANSI TELLS US HOW TO MEASURE so you are really just parroting ANSI now. Matched pair, Data driven market reaction, lets cover those thing according to the ACCURATE STANDARDS
@BA
“REALTORS WILL NOT BE TAUGHT ANSI . TOO much liability!!’
Why do you paint with such a wide brush?
I know a local appraiser that has been teaching real estate agents and brokers in my market for just under 40 years. He is good at what he does. We had the same mentor. I have reviewed his work and it wouldn’t surprise me to know he has reviewed mine.
I looked on Youtube yesterday to find something about helping me build some spreadsheets. Not my strong point. Best one I found was an appraiser teaching his local MLS agents over ZOOM. 2 hour video
Brokers and agents can choose to ignore it but generally the law says a licensed professional “should have known”
In VA an appraisal class is part of the broker qualification process. You can’t be an agent if you don’t work for a broker. So if the broker is stupid enough to not educate his agents that’s his problem.
It’s going to sound kinda strange in court when the appraiser tells the judge he taught the broker the ANSI standard and he passed the class at the right side of the bell curve.
I am a Realtor and have been for 25 years.
Unless you are a Realtor you can not possibly know the state of a Realtor’s training. It is not as much or as detailed as you seem to think. I have to laugh at your thought that Realtors will ever measure by any method other than “the owner stated” GLA just as they do now here and many other states. Realtors do NOT want the liability of ANSI. They are too hands off for that . No one requires accuracy as they are not involved with the loan process like we are. They don’t even meet their clients for contracts…DOT LOOP. IT’s so much worse than it has ever been.. So you can count them out for ANSI. For the Real Estate license the training is brief on the subject of appraisals and they are taught simple length x width GLA. But even with MLS trying to get the reporting more accurate, Realtors still count below Ground level rooms and bathrooms in the above grade room count. ITs to draw buyers not for accuracy. The Code of ethics covers honesty but there is no way to prove intent with this. NAR will never allow ANSI requirements for Realtors IMO as I said there is just too much liability. NAR doesn’t want more liability for Realtors
I speak with both Real Estate and the Appraisal Code enforcement fairly often. I was told that the last 2 years had record complaints…..Appraisers against Realtors
Second MLS does not require a whole lot from Realtors. Core logic is an advertising form. They would like agents to be honest and not misleading but they do not check to see if they are. Other agents are supposed to watch dog the listings for accuracy and then send a flag off to the MLS team. Once they are sold there is nothing done at all.
MLS does not have to worry about accuracy cause they are not entering anything.
In my area the MLS stopped the ” Coming soon” because the agents here abused it so badly that Core logic stopped it. But the Board President in his monthly news letter told all the Realtors in the Association to ignore the MLS as to ending coming soon , keep doing it and just get the owners permission. !!
Brokers are not responsible for agent’s actions anymore. Too many agents for a Broker to baby sit.
All courses have to be approved by the state, I have yet to see ANSI as an approved state course for Realtors. Even the Appraisal course for ANSI is non credited unless given through an approved provider.
Since core logic owns many of the institutions now some have dropped Real Estate classes altogether. Boards offer free CE and the providers could not compete with free.
Most of this I posted earlier, you must have scrolled on by.
“I am a Realtor and have been for 25 years.
Unless you are a Realtor you can not possibly know the state of a Realtor’s training.”
I have been a Realtor for 38 years.
I was a licensed real estate agent before you were a Realtor.
I passed the Virginia State education requirements and State administered Broker exam before you were a Realtor.
When I took the required Real Estate Law class the Attorney announced that he had never had a student never miss a question on his quizzes and exams.
He then handed me my test papers and said congratulations, you are the first.
Anyone with a few hundred bucks can be a Realtor.
Yeah,,, I’ve never heard of any of those scenarios you speak of. Who is Core Logic. Do they drill wells in your area?
NAR? I have heard of them. Novell Authorized Reseller Yeah, I was a Novell server admin too for the local power company. i had a rough year right before Y2K, wife’s company got bought out, business was slow, I went back into IT work. did appraisals at night and weekends. You might have heard of the company I worked for, Dominion Resources. I worked as desktop support for a Win95 roll out for the business dept. Had about 100 managers I took care of as they restructured. Five minutes after I walked on the floor a girl walked over to me and said here’s your login info. You have 5 servers. Check them out. If you have questions call so and so.
Go to YouTube – type in One James River Plaza Dominion. Look for the third window below the top level of windows. It overlooks the James River. That was my cubicle. Dominion has it’s own bank, phone system, and security force.
But I’m just a dumb ass. Thanks for getting me on the straight and narrow. I’m going to fumble my way around now and try to find that ANSI Measuring thread. Sorry to have disrupted your FNMA Valuation thread.
You are probably right. I don’t know fertilizer from shoe polish.
Well actually I shouldn’t say that. Having appraised quite a few “gentleman’s farms” as we call them or small equestrian properties. I actually have learned how to spot ho****h*t when I’m in it’s prescience.
Adios amigo.
Well that’s more about you isn’t it. How very qualified you are and how the rest of us are not. The whole theme here IMO. I have complemented you on several occasions and was more than respectful to you. All you hang on is the one point you see that’s negative. Thats sad Tom. IF you only want praise and adoration then Blogs may not be your thing. Others opinions deserve as much consideration as yours even if you are more than qualified and have all the answers. No one was rude or condescending to you but really look at the posts and you will see that is the theme here from you. I think you may have a lot to contribute AND so do many others if you let them. I’m sure everyone welcomes your opinions and answers and any knowledge you wish to share but it all cannot be about your opinions and thoughts…. Sorry
I do find it odd that with all your ability and training the things you said about Real Estate agents, their training, the brokers and more was very incorrect. I had shared way back on here that I am a Ral Estate agent. When you started telling me how well-trained Realtors are, even on appraising and so on and how they will now do ANSI I felt I needed to clip paste my earlier post so you knew I was an Agent still active. That was meant to inform nothing more.
The very fact you choose to “investigate me” while remaining anonymous shows you need an upper hand and an insinuation of superiority or threat.
National Association of Realtors = NAR. Core Logic = Parent of MLS here and other States.
All you had to do was ask no “”covert OP” was needed. LOL
“The very fact you choose to “investigate me” while remaining anonymous shows you need an upper hand and an insinuation of superiority or threat.
National Association of Realtors = NAR. Core Logic = Parent of MLS here and other States.
All you had to do was ask no “”covert OP” was needed. LOL”
Dude are you serious? ….. Holy Cow.
Do you honestly think I don’t know who NAR and Core Logic area?
LOL
I’ve posted screen shots of my software from CoreLogic. They own my MLS… LOL
Investigating you? What in the hell are you talking about? I don’t even know who you are.
YOU went off telling me if I was Realtor … Well I’ve been a Realtor long before you were. So fn what? Who cares?
I’ve never said I’m better than you. Never said I was better than anyone here. I don’t even want to be. In fact if there is someone here better than me I want them to teach me.
I’m not better than anyone. I have my own unbiased opinion. I do it my way.
Oh BTW… ignore those black helicopters
Do you actually rely on what a realtor says about the GLA? The one with only 1 goal in mind, Sell for the most they can possibly get worth it or not. They add in decks, basements, garages, sheds just to pretend it is bigger than it is. They say Full basement when it is not, had one agent tell me how wonderful this “Full basement” is while we were standing at the opening to the crawl space looking in. Very rarely have I ever relied on a realtors statement of size and only when it is specifically broken down and is consistent with assessors records for the areas I am sure about and I am familiar with the style/model house. 99.99999% of the time the GLA listed on the listing is made up. SO why worry about what a realtor says? You have to provide proof of your data beyond the listing agent who do you use, the sellers?
BA…I have been ANSI compliment for 30 years. Everyone from the 50 appraiser office I was taught by has been ANSI complaint for OVER 30 years.
This is long over due.
“BA….most of us have been doing this for 30 years…those of you who have not will get used it it… it defines what “livable space is…no more 5? ceiling counted as GLA, which they should never have been….for obvious reasons… ”
That’s a good point and I would like add just one other perspective. In our newer construction that generally works fine.
If I go into the city where the homes are 70 to 120 years old a lot of multiple renovation happens. If someone builds in bookcases, wires up entertainment systems, a wet bar, portions of a bathroom, etc.. The under 5′ sections can in fact be the most expensive and marketable segments of that floor. In fact they are.
In the past, I used my judgement, knowledge of the market as to what modern buyers were paying for, and made a judgement call as to how I measured that room and compared it to other sales. I never really liked that but I thought it was fair. I described in report what I was doing and why. It was my opinion.
Now I don’t have that worry. I can cut all that out and place it elsewhere. If it slices through a new bathroom, AND, if it eliminates the $5000 of cabinets, and if it eliminates the wet bar… I will simply note that in narrative.
For the Non-ANSI people here.
In that above scenario. My photographs would have a line drawn through them showing bath, wet bar, cabinets, etc. cut out.
Comp1 = None of that stuff. It’s just an un-renovated unaltered space equal to my ANSI section.
Comp2 = Similar renovation. Similar space. Similar overall value as buyer sees it.
My adjustments
Comp1 = +$75K
Comp2 = 0 — provided overall finished suuare footage is equal to my subject.
Subject ANSI = 2000 non-ANSI = 300 Total = 2300
Comp2 MLS = 2300
So Comp 1 GLA line will be pretty much 0
Comp2 GLA will be a -$75K in GLA due to how MLS reported it. Best data I have.
My additional lines
ANSI Dim Area————Comp1 +$75K
————————————Comp2 0
Comp1 sold $400k and adjusts to $475K
Comp2 sold $475K and adjusts to $475K
Subject sold $475K
BA…. What strings are you referring to?. Nothing has changed except the way appraisers now need to report GLA. No more including a 5-ft attic into GLA, no more including an open foyer as GLA, no more reporting open family rooms as GLA. A 5 ft room on a second floor is now officially a finished attic. There is no conspiracy hear me nobody is out to get us. If anyone here tells me a 5-ft finished attic has the same value as the first floor, then they have been fooling themselves for their entire careers.
As to market-based adjustments, our adjustments have always been market-based until recently with the computerization of appraisals, appraisers have relied on various methods of determining a price per square foot.
When the praiser God say the adjustments have to be market-based, what that means is no more absurd adjustments at the appraisers discretion, that wording is used when appraisers do not use even close to a typical adjustment that would be found in the market. They now can read our reports and compare appraisers and their adjustments in different value ranges of properties.
Some of these appraisers think that there is a conspiracy going on. I find it ludicrous.
And because so many people respond to what I say, I never said realtors would utilize the ANSI method of measuring, but they will finally be taught that we appraisers are using that method and that is why our reports do not reflect what assessors report.
That is all, a finished attic is a finished attic, no more counting it as a bedroom to help out the property’s bedroom counter for a higher appraised value, no more using gross building area instead of gross living area.
The fact that so many of these appraisers are upset tells me they haven’t been paying attention and have been just form fillers relying on data driven by computers instead of the market reaction.
And I will say it again, we all went through this 15 years ago, when they talked about below grade and above grade.
I SO TOTALLY AGREE. SO WELL SAID!! THANK YOU. This has been my concern. Expressed since I came here to this site.
FROM FNMA
“When the subject property has an area that does not meet the ANSI minimum ceiling height requirements, the additional square footage must be reported on an additional line in the adjustment grid and an -APPROPRIATE MARKET ADJUSTMENT applied, if warranted. Additionally, the appraiser must provide and explanation in the report for how this area was handled in order to comply with the ANSI standard and also acknowledge any contribution of the additional square footage.”
So here it is. “MARKET adjustment” not just experience and knowledge of the style and area. Do not fall into this hole. Now as already stated you cannot adjust what you have not inspected or cannot get reliable data on. IN this case GLA has to be measured for accuracy as there is no ANSI GLA DATA on homes not yet measured with ANSI. You know apples to apples.
Copied from https://www.datamasterusa.com/
Three requirements for accurate data
1. Accuracy
Is the data source known to be typically correct, factual, consistent, and precise? Is the data required to be entered in a uniform format? In other words, a data source such as the MLS may require certain data points such as site size to be entered in a consistent and specific data format.
Illustration
An assessor’s office has recently been found by a governmental oversight committee to have produced property records that are neither accurate nor uniform in an effort to lessen the tax burden on those well-connected to various local community leaders. This finding has been well-reported in the local market’s news sources. In this case, the assessor property records would be considered to be an unreliable source by an appraiser until the assessor’s office has remedied the discovered concerns about the property records.
On the other hand, an assessor’s office that is known to employ a state-of-the-art property data gathering system that is verified on a biannual schedule by an independent source and discloses all records such as sketches, property ratings, and calculations which allows the public to replicate the assessor’s work may be deemed as a reasonably reliable source by an appraiser.
2. Trustworthiness
Is the data source considered to be objective, impartial, and credible?
Illustration
Exaggerations pertaining to a specific outcome may compromise or alter the neutral perspectives of the data. For example, relying on property details as listed in a “For Sale by Owner” listing may be determined to be unreliable data as the author of the data (the homeowner/seller) may exaggerate positives of the property or under-report negative concerns of the property, all in an effort to sell the property quickly and at the highest price point possible.
3. Timeliness
Is the data from a time period suitable for the appraisal’s effective date? How often is the data updated? Data would be measured on timeliness if it is a dynamic record rather than a static record. For example, if an appraiser was confirming the year built of the subject dwelling and found that it was built in 1955, she could rely on this data even though its reporting date was 10 years ago, since the year built does not change over time. However, the appraiser would not want to rely on MLS data that is 10 years old for determining the property’s current condition, modernization, and quality for an appraisal with a current effective date. The subject home may have undergone remodeling or renovations over the past 10 years, or the subject dwelling may not have been maintained over the past 10 years, either of which could drastically impact the appraisal assignment results.
Illustration
The accuracy of some data may decay over time. For example, data about the subject property’s condition, interior finishes, and modernization are just a few items that may significantly alter over time. Thus, as a precautionary measure to limit liability to the appraiser and in an effort to adequately inform the client, the appraiser should disclose the effective date of sources of data—especially data points that are impacted by the passage of time.
As an illustration, perhaps an appraiser is relying on an aerial image of the subject property captured three years ago. The appraiser should indicate the effective date of the satellite image in the appraisal report, as the subject property may have been altered in the past three years in a way that negatively or positively impacts the subject’s marketability or value.
Does anyone know of a way to print each and every blog comment and response in one effort? Like select all and print, but I am not having much luck and would REALLY like to have all these thoughts, even the pissing contest ones, for posterity. No particular reason, but FNMA changes frequently; USPAP changes every year or two, and ANSI was just revised in 2020. Sure would like to track how the dust settles from the beginning of the requirements first being implemented and argued. And, by the way, the basic and very simple solution to all these rules that paint us into an ever decreasing sized corner….. is just to reverse the rolls (like every single other profession in existence) and have the service provider (us) write the assignment parameters instead of the client. If, when some enterprise calls you and wants your services, YOU tell them what you provide, how much it might cost, and when they can have the finished product. They can decide whether or not to retain you, and we, like doctors and lawyers, have a license to practice what we do, and what we provide is our opinion of the estimated value of real property. How we all got sucked into being told what to do, how to do it, what we can charge for what we know, and even gouging us to upload (yunno, the administrative process that the client dictates the delivery method of YOUR product, after telling you that you cannot include an invoice for services with your order; and for which they can reduce your fee if you are a day late, but they refuse to pay late charges and pay whenever they damn well please…..yunno, THAT administrative process) is beyond me.
Doug… Every profession changes, doctors lawyers nurses, dentists, accountants and yes even us appraisers.
The world turns and there’s nothing you can do about it.
Just keep singing along and let the sun shine in.
Doug,
I agree and I think we can discuss these things and get some good conversations on these topic. I think we may have to move away from the sunshine man and his cohorts though JMO
AGAIN I think the patients are running the Asylum!! Just take you pill and smile!!
As far as the fee goes I tell every AMC that my fee will be increased by the upload fee so they are paying it not me. They always pay it .
I also include the comment that the turn time will be 5 business days AFTER the inspection is facilitated and the due date must be adjusted to reflect my terms if the inspection is delayed. I do not let them bully me into the ol 24 or 48 hour BS. I have a schedule and just because their borrower delays does not mean STOP DROP AND ROLL for me. I tell them RUSH appraisals are always more !
I think all of your comments and concerns are very valid , the same as most of us here. I believe they can all be addressed with logic.
I do think this new rule of FNMA is a question of AIR /Dodd FRANK JMO
Hi Doug. On the point of saving this conversation for posterity. When I must have something I take image snips if they’re within a single page view. If not, you’re left with copy and paste which can be placed in notepad or a blank email draft. You will of course lose the formatting and it will be one giant giant block of language text, but I think it also copies the posters name and time of post so at least there is that. Otherwise you could use some sort of image capture in real time deal and just slowly scroll everything while you have that recording, play it back in slow motion later, but all you’d have is a visual of the text. Not sure if my browser settings inhibit the ‘print preview’ but I just get the article and no commentary so have turned generally to copy paste in an email for review before posting, that sort of thing.
What a shame that 3 or 4 or 5 who really knows maybe only 2 (Chris, chris and Chris and Tom B and Thomas Baldwin) people all parroting the same remarks over and over making this all about a measurement method. No matter what any of the more than 30 or 40 people here were concerned about the response from these 2, 3,4 or 5 repeated over and over their how to do ANSI and their “30,35,38 years of experience and their superior credentials AND NEVER addressed anyone with any LOGICAL comments addressing the REAL ISSUES THAT EVERYONE but they were posting about. What a shame that these people got belittling, rude and out right childishly stupid when any of us was supporting any idea of protesting the FNMA rules on this.
One by one they chased everyone away by repeating over and over again the same “I have been ANSI compliment for 30 years. Everyone from the 50 appraiser office I was taught by has been ANSI complaint for OVER 30 years.” AND /OR “I have been writing appraisal reports for 30 years, and my market area, 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” ” OR most of us have been doing this for 30 years…those of you who have not will get used it!!
Or other demeaning self-gratifying, narcistic remarks !! No intelligent communication and some really ridicules “solutions” on just guessing GLA and other completely non responsive illogical comments! ALL THE SUGGESTIONS WERE NOT ANYTHING ANY OF THE APPRAISERS WOULD EVER DO. IMO ALL THEIR WORK AROUNDS …READ UM …CRAZY!!
Now think about it, if these guys really had all of that experience, those credentials why couldn’t they speak about anything other than how stupid all of the rest of us were and then repeat over and over how to measure by ANSI standards and demean us ALL for not being as smart as they are?? Why no concern over all the things the rest of the APPRAISERs here NOTED. Not once did any of them address any of the other REAL topics. I don’t think they had answers for us and could not add any real substance to our thread. So why be here? They clearly did not speak APPRAISER LANGUAGE with the exception of ANSI.
Slowly one by one they attacked each person till there’s no one left. Not one person speaking about the problems FNMA has created. No one left who was asking for unity and standing up against FNMA on the appraisal direction of this NEW requirement!
WHY IS THAT ??? NO CHRIS ,CHRIS and cHRIS , TOM AND THOMAS IT IS NOT ABOUT ANSI AND AS WE ALL SAID MANY TIMES IT NEVER WAS and you knew it. !!
So REALLY, WE LET FNMA SUPPORTERS OR REPS (?) win! They shut us down so no more talk or support for anyone who is logically concerned about the out come of this NEW requirement FNMA has created. NO more comments on this thread about rejecting or contesting this or FNAM? NO more help suggestions on eliminating risk. No comments or brain storming about how to avoid jeopardizing our licenses or E&O rates. Why would they care if we commented about THOSE things and Not about ANSI?
YOU THINK THAT SOUNDS CRAZY WELL… WHERE ARE THEY NOW??? THEY ARE SILENT ……….HMMMM I think I called it way up the thread.
To me its about consistent standard of measurement across the entire country so the average homeowner can get the most consistent results, as far as actual facts of the house, when getting a house appraised. All I see are people saying things like houses no longer have second floors, now this area below grade is suddenly a basement but M&S says it cost more than a basement to build but less than full above grade (Can you guess why), I cant round to the nearest foot etc.. The most basic part of ANY appraisal is the sketch and specifics about the house that anyone that is a non appraiser can verify. I have seen way too many lazy and stupid appraisers cut and paste the assessors sketch never measuring the house because it takes too long and is way to hard. Or appraisers incapable of using the ACTUAL measurements because fractions scare them. Thats just lazy and stupid. If a room has 5 or 6 foot ceilings it is not functional. If you have such a thing you use sales of the same style so this, I have no second floor junk is a worthless argument because your sales are the same. If anyone has been including very low ceiling areas as living area or including basements as above grade GLA then you didnt get anything out of appraising 101. Use the same style houses, do let the realtors dictate what you do and everything will be fine. I have never said I am superior in any way to any other appraiser. I think I am no more than average overall. I am just pointing out that an average guy with average skills can do this, has been for a long time and has had no issues that have been found to be unsupported as far as measuring and functional use goes.
WE ALL KNOW WHAT YOUI THINK YOU HAVE BEEN TELLING US ALL FOR DAYS… WEEKS …WHAT YOU THINK. AND I MIGHT ADD IN A VERY BELITTLING CHILDISH WAY. Everyone here does not think what you think because there are a lot of flaws in what you think as far as Appraising is concerned.
I read every post here. Only 1 person made the statement you few (if there are a few of you) people hang on. At the time he was working in his career years ago and area I believe there is NO way for you or any of us to say so arrogantly he was wrong. If you think Martin was so wrong let me tell you ..YOU have made some ridicules statements that are much more in error then anyone here. IMO You all are the only one’s here that have to make a point of YOUR CREDIENTIALS. WHO CARES !!! IF you slipped by on credential and none the home owners got an accurate appraisal then what good are credentials? Really all of you never read OUR comments or you would not have (ALL 2?3?4?5 or what ever ) been saying the same thing OVER AND OVER.
ANYONE CAN CLAIM ANYTHING HERE ! The fact you and the rest of the Chrises and Toms never said anything like Appraisers think leads me to the conclusion that YOU are simply Posers…. HERE TO SHUT THIS DOWN!!
Just in the way you approach a problem and your flippant silly solution tells me you are not appraisers. If you are then even your current comments show a lack of knowledge of the STANDARDS, USPAP and how too properly ascertain value. You could have really benefitted from others here IMO. You all are great with measuring of the subject part I GUESS (BUT SO ARE THE REST OF US!!) anyone can read a book! but THERE’S A WHOLE LOT MORE TO APPRAISING!!
You do not even understand the most basic principals of Appraising in the real world and do not seem to think there is anything else to consider in an opinion of value. and OR IN FNMA ACTION!
BA…I am trying to get you to think. Sometimes you have to get people a little mad to get their head back. All I have read is appraisers saying their rights have been taken away, or they will be sued, or using ANSI somehow will mislead the reader of the report. or the realtors will get mad or the builders will get mad, or they will now have to put a comment in their report that ANSI was used….
I am so sorry it bothers you that some of us have been using ANSI all of our carriers. Why don’t you believe that?
Myself and the other Chris have gone to such extent to try to calm some of you guys down. The other Chris actually had to give an appraisal 101 lesson to someone on this site that I considered to be an expert.
We all type these response in different frames of thought. Some good some not so good, my apologies for getting aggravated.
I have lost so much respect for some of our fellow appraisers, auguring the difference between gross building area versus gross LIVING area.
Its mind boggling and very frustration trying to talk to some of you, now you are accusing me as not being an appraiser, is that your way of trying to justify to yourself that you and some others are right? Some want to boycott the lenders to “teach” them a lesson”….others are mad they they were not included in the discussion about moving to ANSI.
Really?
“The fact you and the rest of the Chris’s and Toms never said anything like Appraisers think leads me to the conclusion that YOU are simply Posers…. HERE TO SHUT THIS DOWN!!”
What do you mean think? Are you mad that we are not agreeing with you?
“Just in the way you approach a problem and your flippant silly solution tells me you are not appraisers.”
What flippant silly solution ? You mean just accept the new standard? Or stop making a mole hill into a mountain…
Good luck my friend….Lord knows me and the other Chris and others have tried.
Good luck with ANSI…
WOW really this is exactly what I (many of us) mean… you ask a question of me then YOU answer it!! Don’t you want to know what I mean or think or do? You just want to ASSUME you have MY answer?
Chris or chris or Chirs did not have to teach anyone here anything. He chose to see himself in THAT all knowing capable position. I do not recall anyone asking anyone about 101! Further ALL of you are incorrect in your answers for any of the questions or concerns here. You all know you were condescending, (even in your latest post here) rude and downright awful here more than once. How is that helpful or INTELLEGENT?
You all have a way of answering a question not asked and none of you are reading other people’s comments. IF you were than you would see everyone but you and whoever the other 2,3,4 or 5 are….ARE NOT TALKING ABOUT ANSI in the way you all just ASSUME (cause you’re not READING). This is so elementary and your contrary and silly assumptions on my thoughts are equally just wrong.
The more people who stopped posting the more you targeted those who were left…till now crickets. Do you find that stimulating, educational or impressive? I don’t !
The fact that you say “GOOD LUCK WITH ANSI” to me, proves this. Why not go back and read so you can catch up …or don’t ….I really do not care if you get it or not …I see so far NOT!!
BA,
So you are that guy in all CE classes that doesn’t shut up about what he knows, assumes he knows more than anyone there, including the instructor, and wastes everyone time taking about what he knows, what he believes and how he thinks everything should be done.
Well now we see some progress … SELF REFLECTION IS A GOOD THING…..
Chris or chris or Chris
It really is a shame that this blog turned South early on. ANSI, while certainly worthy of discussion and taking a position on, will not solve the real “appraisal problem” that we all have, and it really isn’t an effective tool anyway, but what the heck do I know. Being one of those AG certifieds from the very beginning (to early to get trained by anyone above me) since 1992, and licensed in real estate since 1971, and a broker since 1991, in a rural and complex market where there was no building department (or effective assessor) until the mid 1960s, with a substantial percentage of homes on hillsides and built well before permits existed, we have our challenges. Nonetheless, years ago I could tell you what a home or small commercial property (that’s all we have around here) would likely sell for within a couple of thousand dollars by walking through it. While licensing for this ability was inevitable, and probably necessary, the imploding rules then implemented and the scope creep that evolved because the cart was leading the horse has severely lessened the reliability of ALL appraisals in my opinion. Think about it….. how Fannie will reject a loan over a missing water heater strap; or in my case feeling the pressure to always tell them in writing that this home built 80 years ago still has a remaining economic life of over 30 years (or, more accurately, exactly 30 years so that they can do their loan if I expect to keep getting assignments from them, is what has ruined the profession). Look at FHA. The concept has gone from value to health and safety, and the appraiser has gone from valuation professional to home inspector….. all with increasing liability. Now, we all know that the primary motivation for sanctions and license revocation by BREA is allocated to terrible adjustments either intentionally or otherwise, and yet virtually all policy changes trickle down to a direct influence on the risk we take doing our jobs. Fellow bloggers, I can generally still tell you what a home will sell for in my market within a 3-5% margin in minutes without any sort of report, but I sure do notice that my reports now are 50-60 pages long with 16 pages of disclaimer and scope of work clarifications, combined with the myriad of rules having little or nothing to do with value or marketability……. and that my margin of error because of all that is now 10-12% based on following the mandated guidelines that really should not be appraisal industry standards that are enforceable. I can still tell you pretty close by reasonable observation what your property will sell for because of all the years hanging around this market area and industry, and really don’t even need to know what the square footage is. Was so hoping to be a helpful participant in this blog and to gain some serious insight into the overall impact……. but too much time wondering where all this banter is coming from, and why we can’t…..as a large group with a substantial voice……keep things in line without blind submission. Go figure.
Doug,,,,its not about just a value on a home, the loans need to be sold. Every change that has occurred, past listing history, past sales history, how many active and sold are there, the MC form, supply interior photos, supply both sides of the street, The C and Q ratings..
Is all because appraisers were cheating to keep making the deals for their clients.
And that is how we got management companies
ANSI is long over due.
Chris…..swear this is not intended to be confrontational, but I strongly disagree with your last message. The fact that loans have to be sold is not our problem; lenders order valuation assignments from us so that THEY can make an informed decision. WE are retained to provide an opinion of “value” only. I have NEVER been retained to be a photographer; a pest inspector; structural engineer; appliance functionality expert, and so on, and neither have you. We have allowed the scope creep to happen, and it has swallowed us whole and spit out form filling order takers instead of qualified professionals. Personally, I have never “cheated” to make a deal work for a client / lender on my own, and the pressure to overlook deficiencies and fabricate remaining economic life so that a lender can make their deal is unacceptable from ANY viewpoint. In addition, and as a direct result of the invasions of privacy put on us by those that rely on our services to “make their deal”, please understand that mandatory background checks (also at our expense if they get their way), have become a necessity if we are to keep getting assignments….. from…. those….. that…. wish….. to….. have….. a….. perfect…. scapegoat. Note the differences in your own E&O coverage these past few years if you think I am making this stuff up.
In the very sincere hopes that you simply take this for what it is worth, ignore or digest it, and please don’t message back telling me I don’t understand. I do.
Doug…if you don’t provide a sketch..the appraisal cant be used…if you don’t supply a map….yada yada yada, past sales history, pictures…everything we do with our appraisals is so the loan CAN be sold and bought by investors..Whoever they are. All the addendum commentary is needed….my point being its just not about a value.
“We have allowed the scope creep to happen, and it has swallowed us whole and spit out form filling order takers instead of qualified professionals.”
What in the world are you talking about….we allowed….no sir, we are told by the appraisal GODS of what they need..its not the other way around…
Which brings us back to ANSI standard….its their call, if they dont want 5′ attics counted a GLA…then that s is what we do….or stop doing appraisals.
You say you never cheated, glad to hear but I did reviews for the big boys in this country for 5 years, the funders with the money, I used to have to rewrite the appraisals (which is why they sent them to me) and every one they sent, i said the same thing at the end of the review”my review and my appraisal and the appraisers appraisal should be sent to the state agency for peer review.”
None of them ever did, I asked why…I was old because they like the lender and the appraiser cheats too much sometimes, so they have to weed out the ones that would jeopardize the loan pool from being returned by the investor.
I replied…how do you know your are finding them all? then the mortgage buy backs started, then they want to take the appraisers license…so they asked my to handle license revocation case, i didn’t want to so I told them $500/hr including my drive time and they agreed.
Before I had too, they went down like fly’s in a few months during 2006 and 2007, just gone….bye bye clients and hear came HVCC destroying us.
They knew all along and did nothing !!
Chris regarding your comment on forensic review. There are no appraisal gods. There are bureaucrat humans with every possible shortcoming the rest of us may have whom are working at FNMA though.
Since when did ANSI set the working group policies for the FNMA committees? Again, due process matters. By what mechanism of due process did the ANSI group achieve this perceived power and influence when there is so much obvious resistance to this approach?
I would have sworn your post would deserve a ‘where you reviewing amc originated appraisals’ response, until I read the time frame. Yeah, lender malfeasance. That was proved beyond a doubt and Coumo swept it under the rug and nobody went to jail. The vast majority of mortgage brokers whom pushed those loans were washed out of this industry over ten years ago, longer now. Back then everyone and their mother was a part time mortgage broker. You’ve highlighted known indisputable facts about the malfeasance which has been integrated into big lending for some time.
Again, why should all appraisers be blamed for the actions of other people whom don’t respect long standing principals of ethical engagement and fair dealing? Adopting the principals of submission by force is what got us here in the first place. Many of those appraisers were intimidated and coerced. They did fail in their ethical obligations to turn down orders but for those of us whom lived through that time as 1099’s, it was nary that simple. I used to run two dozen ‘comp searches’ to land a single order. The ‘lions share’ concept started with number hitting and comp searching then merely morphed into price shopping with amc’s pocketing the difference, not returning cost savings to consumers. A portion of that funnels back to the mortgage departments with the largest players. Appraisers are still to this day providing a thing of value to be the preferred assignee, in violation of the management rule. And now we have appraisers advocating the concept we are no longer qualified to manage ourselves or make our own professional judgment decisions to have a hand in crafting scope of work to achieve what we believe, and sign our names on the dotted line; to bring the most credible assignment results. Be careful what you wish for.
Whatever with the bundling of mortgage securities under one uniform engagement, it is not the appraisers job to alter or control municipal standards nor should we deviate from them. Although if you have problems in your area it is wise to advocate for local reform. The origination is national and international but the appraisal of real property has always been and will always be a local effort. The empty bag of mortgage backed securities is a consequence of the federal reserve system, not due to any shortcoming of the appraiser industry as a collective group. Some of the initial posters here called it and called it well; redirecting blame for everything to the appraiser. Scapegoat syndrome.
Baggins…I call them appraisal gods…why? Because they just made an entire industry use ANSI
You can call them what ever you want. But them having that kind of power….makes them GODS in my book
O.k. Chris. You know what, I’m going to get with you on this specific one. A god does not have to respect or abide any due process existing and in place. They can do whatever they want like omnipotent beings, being able to disregard any and every rule of law and due process.
You have experience and examples to illustrate a great many points of malfeasance and disregard for the rule of law. On that we agree such behavior and lack of ethic is unacceptable. However you then make use of the same principals which allowed such transgression by advocating for non negotiable mandates.
You can’t have your cake and eat it too. There is no such thing as new normal. There is either the presence of liberty or lack there of. There is either the presence of law and order, the due process which defines that, or lack there of.
I made this image special for the pro ANSI group. I hope you like it. LOL. Sorry Jamie, whomever you are, the message rings oh so true; stay humble and accept peer input. But you know, I used paint 3d to pop in a few new ‘elements’ of appraisal practice post ANSI era. It’s important for public safety considerations to understand the new definition of a basement. One no longer has to open doors or go down long flights of stair cases to end up in basements. One may inadvertently end up in the basement simply by going to the ground floor level of a tri level in what is commonly known to be ‘the living room’. Appraiser beware. The clowns always win.
Baggins…..your words….A god does not have to respect or abide any due process existing and in place.
They can do whatever they want like omnipotent beings, being able to disregard any and every rule of law and due process.
Not sure why you are correcting me about the appraisal Gods…??? Sounds like God to me…maybe I am just misunderstanding your statement.
I’m agreeing with you. While also throwing in the notion of false idols. Worship them if you want, I’ll pass.
Baggins…got it false idol,,,,,wish we could convince some of the religious zealots in this country.
For where your treasure is, there your heart will be also.
Matthew 6:21
We’ve got far more pressing issues than just ‘thumpers’ to deal with these days…
I’ve always provided a sketch roughing in the toilets, counters etc., and arithmetic from measuring. When I fill in functional utility, I remark about the obvious additions and dysfunctions, and issue a statement as to what IS a functional size. My basis goes from that point forward. The VA used to require it including the make of the built ins. This was a self-incrementing statement to ensure that you entered the house.
Thank you Doug.
Scope creep. An interesting concept to be aware of.
https://en.wikipedia.org/wiki/Scope_creep
aka; kitchen sink syndrome. Interesting, never knew that. And we’re not just dealing with ‘a project’, we’re dealing with a ‘mega project’. Interesting.
This is an interesting reference piece in the references:
https://books.google.com/books?id=BnuZBgAAQBAJ&pg=PA52#v=onepage&q&f=false
Wow, that is a very interesting read, the details of scope creep.
FNMA and ANSI are certainly using an evolutionary methodology here, but do not appear to have accepted much feedback. Enter the flood of criticism. I would copy pages of this if it was able to be copied. So much relevant concept there, what to quote… You know, they could have seen this coming.
“To make matters worse, the purported benefits of the change are often unrealistically over estimated.” Yes sirE, we got a case of scope creep on our hands, one of the most insidious types, from within. That’s for sure. We’ve got problems.
Creepy scopes should be delt with a written contract, before the price is discussed, otherwise the lender can sigh the appraisal and keep the money. Appraisers can make their own mistakes, but not jeopardize his license.
Before B of A won a big case against a borrower, Bart Lyton, Litton S&L Stated that with ten points Litton S&L would make any loan
The VA always wanted to know how much the seller was supporting the buyers financing.
The appraiser includes the financing on the 1004 form and should comment on it. I heard recently that a buyer could get 14-year term with a 2 1/2% loan with some other concessions?
Those kinds of concessions influence a closing and an offering price. Why not value.
I totally agree with your statements. Great points that are appreciated and even shared by many here. So keep being informative. We need more open minded thinkers and more view points and more acceptance of ALL possibilities to evolve.
We are adults here and I for one do not need everyone to agree with me or to LIKE me to be able to express an opinion or my experiences. I am not that insecure. I can allow others to express themselves and I welcome and respect that right without being threatened. I do not have to be submissive if I am in-fact happy with the validity of my process and secure in my experience and knowledge.
YOU have had many great points and a lot of good thought provoking comments.
We really need to keep exploring other problems and other possible liability with this new FNMA directive. IT may just need to be re written with more adherence to the Standards and the methods to deliver a reliable and accurate report. I would bet ANSI the organization would agree. I’m pretty sure that if anyone does not have the training to know what we do they cannot tell us how to do it. JMO
As we all know ANSI is a uniform method of measuring. DOES IT APPLY to every industry and every product accurately? MAYBE. Does this uniform standard apply to diversity in people’s needs. preferences and/or values …I do not think so cause ANSI is logic and mathematical equation that is LEFT BRAIN processing. Most Real Estate is purchased with quite a bit of RIGHT Brain processing. ANSI totally ignores this very important fact. We as appraisers are TRAINED to consider it and determine its effects on our results.
I read that the 2020 revision of ANSI was open for public review and objection. They follow the same procedure as USPAP.
Why not require the same process for lenders mandates and “NEW PROCEDURES” Open them to a public form.
Chris, our United States Constitution due to our founders and enhanced by a War over STATES RIGHTS gave certain duties to the states, many of our congress people don’t know their position and impugn their constituency with ignorance. I’ve been around for over fifty years and heard many stories:
My local assessor related their training program took uniformity into consideration, and they had good people from the construction, insurance, accounting and retired military etc.
About Measuring: Start at the right side of the house read the first whole number, the next measurement read the nearest foot, and drop anything over SIX inches, the next include anything over six inches.
Previously Appraisal textbooks didn’t discuss much about measuring. This stuff was adopted from the late 1940s thru the 1970s
In California we passed Prop 13, and assessors no longer reassessed WHEN values fell lower as measured by the State Board of Equalization, Properties were appraised when the sold. There was no need to re-measure, it was assumed for the most part that they sold for market value. Complaints go on from there imagine the concoctions citizens dream up, or down
Chris… Well said… Talk about jumping off the topic of a standization of measurement article.
I am not an Attorney…don’t mean to brag but I’m not and not…. LOL
I cannot accurately state that anyone including any GSE is in violation of AIR.
I do see a possible violation in the requirement of the ANSI compliance but more so in the reporting, adjusting and directing of methods that do not consider market value or misleading information in reporting or the REPORTING STANDARD.
Anyone care to give a WELCOME OPINION?
Snipped from the AIR doc
” I do hereby certify, I have followed the appraiser independence safeguards in compliance with Appraisal Independence and any applicable state laws I may be required to comply with. This includes but is not limited to the following:
I am currently licensed and/or certified by the state in which the property to be appraised is located.
? I assert that no employee, director, officer, or agent of XXXXXXX AMC, LLC or any other third party acting as joint venture partner, independent contractor, appraisal management company, or partner on behalf XXXXXXX, influenced, or attempted to influence the development, reporting, result, or review of my appraisal through coercion, extortion, collusion, compensation, inducement, bribery, or in any other manner.
? I further assert that XXXXXX AMC and the Lender/Client have never participated in any of the following prohibited behavior in our business relationship:
1) Withholding or threatening to with withhold timely payment or partial payment for an appraisal report;
2) Withholding or threatening to withhold future business, with me, or demoting or terminating or threatening to demote or terminate me;
3) Expressly or impliedly promising future business, promotions, or increased compensation for myself;
4) Conditioning the ordering of my appraisal report or the payment of my appraisal fee or bonus the opinion, conclusion, or valuation to be reached, or on a preliminary value estimate requested from me;
5) Requesting that I provide an estimated, predetermined, or desired valuation in an appraisal report prior to the completion of the appraisal report, or requesting that I provide estimated values or comparable sales at any time prior to my completion of an appraisal report;
6) Provide me an anticipated, estimated, encouraged, or desired value for a subject property or a proposed or target amount to be loaned to the borrower, except that a copy of the sales contract for purchase transactions may be provided;
7) Provided to me, or my appraisal company, or any entity or person related to me as appraiser, appraisal company, stock or other financial or non-financial benefits;
8) Any other act or practice that impairs or attempts to impair my independence, objectivity, or impartiality or violates law or regulation, including, but not limited to, the Truth in Lending Act (TILA), Regulation Z, FIRREA, or the Uniform Standards of Professional Appraisal Practice (USPAP).”
WALKS LIKE DUCK…..QUACKS LIKE A DUCK….IT PROBABLY IS A DUCK.
In all endeavors, some are duck footed, some are pigeon toed, our words, actions and intent identify us.
We have AMC because lenders constantly pressured/threatened appraisers to do what they, the lenders wanted or needed. This included inflating values so lenders could close loans. IT was the unethical behavior and the lack of concern for public interest on the part of the lenders that brought about a need to remove their unethical behavior from the appraisal process. This was thought to be accomplished by introducing a buffer between the lender and the appraiser …. AMC.
Now we see a whole new set of bad actors and poor procedures that are not consumer conscious.
I think anytime we allow anyone with ulterior (self-serving) motives or conflicting interest to interlope in an area that is not their field or knowledge or expertise we open ourselves up to problems. JMO
Off subject
Did anyone else watch the House hearings with the oil companies? The top 5 oil and gas companies had a record 237 BILLION IN PROFITS last YEAR. What do you think they will make this year while we are now paying double for gas? When ask if in “the interest of the state of the US economy and in the interest of trying to help with inflation the companies would consider a reduction to their investors in profits”. ALL SAID NO.
AMCs are doing this and NOW we have a disclosure to show what the appraiser’s actually get paid in the report.
That’s right. Who’s blaming appraisers for the need for amc’s? Did they sleep through the wamu and eappraiseit crowley coumo thing? That’s the same junk all the amc trolls would come forth with. Is Dr Manhattan with us here right now?
https://appraisalnewsonline.typepad.com/appraisal_news_for_real_e/2007/07/eappraiseit-llc.html
https://appraisalnewsonline.typepad.com/appraisal_news_for_real_e/2011/10/cuomo-v-eappraiseit-new-yorks-highest-court-held-oral-argument-on-eappraiseits-appeal.html
Just a little history for anyone wondering how amc’s became the spokes persons for the appraisal industry, even though amc’s do not provide one iota of valuation service themselves. Generally speaking if REVAA (TAVMA) support it, it’s probably not going to be in your best interest as an appraiser.
Huge numbers are confusing, should we evenly distribute those profits to the of 360,000,000 citizens. What’s the definition of profit is it a gross figure or net something? Maby those profits are already distributed to the Stockholders.
DOUG
It may be of some interest. I had an AMC send me a RURAL assignment of the new Bifurcated Hybrid. HE sent it to me as just a “desktop”. He said “Well you don’t even have to leave your office.” I then questioned him on just what the assignment really was. I told him I was not interested in doing the Hybrids. He said and I quote “I have no luck getting ANY appraiser to except these.” I have had 50 of these in the past 2 weeks and could not get even one assigned” “All of those orders had to be changed over to 1004’s to get them done.” So, we as appraisers are able to have an effect when we simply stay as a strong group all with the same expectations. JMO
BA: “I had an amc send me a”
I’ve identified your primary problem.
BA, quoting AIR. Interesting. They are impeding our independence, demanding we ignore local municipal guidelines and existing customary market standards. FNMA has used the CU review and probationary tool as an instrument of force to threaten our future business if we do not comply. (Not to mention cutting our industries potential to earn a living in literally half with desktops, as latest FNMA stats indicate half of all orders which previously would have been full fee full service orders will now be run as desktops. Great timing to crush this industry to install this right as mortgage rates climb upward after periods of historical lows. The ‘ANSI partner’ has certainly influenced developmental methods here, absolutely.
ETHICS RULE. Conduct. / must not advocate the cause or interest of any party or issue; (Obviously FNMA is advocating for ANSI, ignoring many locations existing functional methodologies.)
BEING COMPETENT An appraiser must determine, prior to agreeing to perform an assignment, that he or she can perform the assignment competently. Competency requires: 3.recognition of, and compliance with, laws and regulations that apply to the appraiser or to the assignment. (There is that annoying guidance that we’re supposed to recognize existing regulations.) Comment: Competency may apply to factors such as, but not limited to, an appraiser’s familiarity with a specific type of property or asset, a market, a geographic area, an intended use, specific laws and regulations (What do I know about my local market anyways? Specific laws and regulations only matter at the federal level, local regulations are not all that important anymore.)
ACQUIRING COMPETENCY In an assignment where geographic competency is necessary, an appraiser who is not familiar with the relevant market characteristics must acquire an understanding necessary to produce credible assignment results for the specific property type and market involved. (There it is again, geographic competency, being familiar with the relevant market characteristics. Like let’s say, none of the local municipalities use an ANSI standard for their assessment reporting. A market characteristic is in fact, local existing municipal guidelines and standards. )
SCOPE OF WORK RULE: Comment: Scope of work includes, but is not limited to:•the extent to which the property is identified;•the extent to which tangible property is inspected;•the type and extent of data researched; and•the type and extent of analyses applied to arrive at opinions or conclusions.Appraisers have broad flexibility and significant responsibility in determining the appropriate scope of work for an appraisal or appraisal review assignment. (So much for broad flexibility. Not anymore! Although we can research and learn exactly how the assessors data is presented, we’re no longer able to use that as a reasonable basis for analysis even if we know the assessor is reliable and uses sound methods. Prohibited from using ‘matching units of measurement’ in many locations. This goes to the ‘appraisal method 101’ slander. Purposefully not acknowledging that in places like Adams county, there is no online available source of data to properly parse the garden level away from the rest of the gross living area. You can guess at that garden level size to separate to get closer to matching use of measurement units, or you can disregard the concept of matching units of measurement entirely and start your grid off with misleading falsified indicators of gross differences.)
SCOPE OF WORK ACCEPTABILITY17 An appraiser must not allow assignment conditions to limit the scope of work to such a degree that the assignment results are not credible in the context of the intended use. Comment: If relevant information is not available because of assignment conditions that limit research opportunities (such as conditions that place limitations on inspection or information gathering), an appraiser must withdraw from the assignment unless the appraiser can:•modify the assignment conditions to expand the scope of work to include gathering the information; or•use an extraordinary assumption about such information, if credible assignment results can still be developed. (Q7. Can appraisers use the exception code to voluntarily opt out of compliance with the ANSI standard?No.) (So much for reasonable limitations on when it is acceptable to use extra ordinary assumptions. So much for modifying assignment conditions to be better reflections of current market standards and more conducive to credible assignment results.) Determining the scope of work is an ongoing process in an assignment. (But for sketching and choosing to recognize the legitimacy or reliability of local municipal standards, the appraiser no longer has control over SOW crafting input.) Information or conditions discovered during the course of an assignment might cause the appraiser to reconsider the scope of work. (Curious, like perhaps identifying the local assessor, the entire realty community, and the MLS system do not use an ANSI standard? Is that not a discovered or learned piece of information that may influence scope of work? We all need more remedial training to understand this concept, and we need to buy more books!)
JURISDICTIONAL EXCEPTION RULE If any applicable law or regulation precludes compliance with any part of USPAP, only that part of USPAP becomes void for that assignment. Comment: When compliance with USPAP is required by federal law or regulation, no part of USPAP can be voided by a law or regulation of a state or local jurisdiction. / Law includes constitutions, legislative and court-made law, and administrative rules and ordinances. Regulations include rules or orders having legal force, issued by an administrative agency. Instructions from a client or attorney do not establish a jurisdictional exception. (The question of FNMA here and their role comes into play. Is the FNMA instruction adequate to establish a jurisdictional exception on thsi matter? Administrative rules and ordinances? Like the specific building codes and municipal guidelines in that counties jurisdiction for recognizing building space? Those municipalities having long since adopted something OTHER THAN the ANSI standard. Just wipe out substantial portions of USPAP with one ANSI FNMA federal regulation.)
STANDARDS RULE 1-1, GENERAL DEVELOPMENT REQUIREMENTS In developing a real property appraisal, an appraiser must:(a)be aware of, understand, and correctly employ those recognized methods and techniques that are necessary to produce a credible appraisal; (You mean perhaps like taking the time to become geographically competent and actually learn and know your LOCAL MUNICIPALITIES ordinances and guidelines for recognizing and defining residential building space? That’s a really convenient and sensible approach. No assumptions or extra ordinary assumptions needed.)
Comment: This Standards Rule recognizes that the principle of change continues to affect the manner in which appraisers perform appraisal services. Changes and developments in the real estate field have a substantial impact on the appraisal profession. Important changes in the cost and manner of constructing and marketing commercial, industrial, and residential real estate as well as changes in the legal framework in which real property rights and interests are created, conveyed, and mortgaged have resulted in corresponding changes in appraisal theory and practice. Social change has also had an effect on appraisal theory and practice. To keep abreast of these changes and developments, the appraisal profession is constantly reviewing and revising appraisal methods and techniques and devising new methods and techniques to meet new circumstances. For this reason, it is not sufficient for appraisers to simply maintain the skills and the knowledge they possess. when they become appraisers. Each appraiser must continuously improve his or her skills to remain proficient in real property appraisal. (Continually improve our skills? Like becoming aware of local municipal guidelines and not just lazily falling back on ANSI one size fits all because, well, it’s what they have been doing already for so long?)
b)not commit a substantial error of omission or commission that significantly affects an appraisal; and Comment: An appraiser must use sufficient care to avoid errors that would significantly affect his or her opinions and conclusions. Diligence is required to identify and analyze the factors, conditions, data, and other information that would have a significant effect on the credibility of the assignment results / (Curious again, like perhaps providing false misleading net/gross figures based on purposefully manipulated data because one is applying adjustments which have 0% net influence but drive gross adjustments 30%+ or more, although those adjustments DO NOT REFLECT ANY market reaction? aka; ANSI applies to your subject but not your comps. Nothing misleading about starting off with a very high gross adjustment indicator, that’s normal when one is utilizing matching units of measurement right? Some people would call that putting your thumb on the scale. Adjust it out, adjust it back in on another line. Drive your gross indicator of dissimilarity up on a technicality. Disregard the fact the net/gross indicators are considered by many to be the absolutely most important numerical figures in the entire valuation analysis report. Some would call that incompetent analysis.)
(e)identify, from sources the appraiser reasonably believes to be reliable, the characteristics of the property that are relevant to the type and definition of value and intended use of the appraisal,22including: (i)its location and physical, legal, and economic characteristics; (Oh no, losing ground again. Due to the ANSI rule coming from the federal level and precluding USPAP guidelines, we just lost another one. We are no longer able to rely on the reasonable and consistently reliable assessors reporting. We no longer can rely on their municipal guidelines regarding definition and recognition of space. We can not follow the local standards to prove geographical competency and instead, like pioneers of old, we must blaze our own trail.)
Comment on (i)–(v): An appraiser may use any combination of a property inspection, documents, such as a legal description, address, map reference, copy of a survey or map, property sketch, photographs, or other information to identify the relevant characteristics of the subject property. When appraising proposed improvements, an appraiser must examine and have available for future examination, plans, specifications, or other documentation sufficient to identify the extent and character of the proposed improvements.23 (But as several here have said, those lazy cheating appraisers complying with Standards Rule 1-2 (e) (i), utilizing reliable local assessors material. They’re simply doing it wrong. They should comply with ANSI instead! I checked the 2020 digital copy USPSP and did not find one reference to ANSI, not one. Never mind the ANSI ‘guidelines’ are overly flexible, always changing, formed by a pathetically small work group whom does not have prerequisite experience in the majority of jurisdictions their rule effects professional appraiser practice. The ANSI advisory group for residential measurement standards also summarily ignored the vast majority of volunteer appraiser consultants suggestions when forming this ANSI rule for residential appraisal. ANSI is not a commonly accepted practice in the real property services industry at large, which is why in some locations only a rare appraiser and assessor choses to utilize the ANSI approach. Let’s also ignore that the ANSI group defines a different standard for residential in commercial buildings, recognizing ‘ground floor’ as being acceptable to be below grade, just as long as it’s not more than 4 ft below grade. Boy that sounds a lot like the existing perimeter based standard that assessors whom do not use this new residential ANSI standard have already long since adhered to.)
STANDARDS RULE 1-3, MARKET ANALYSIS, AND HIGHEST AND BEST USE When necessary for credible assignment results in developing a market value opinion, an appraiser must: (a)identify and analyze the effect on use and value of: (v)market area trends; and Comment: An appraiser must avoid making an unsupported assumption or premise about market area trends, effective age, and remaining life. (Isn’t the municipal standard for recognizing how a local municipality defines gross living area, that drives all assessment reporting, taxable basis, and all realty agent reporting, isn’t that a ‘market trend’? I’d better go back to appraisal 101 and figure this out.)
STANDARDS RULE 1-4, APPROACHES TO VALUE In developing a real property appraisal, an appraiser must collect, verify, and analyze all information necessary for credible assignment results.(a)When a sales comparison approach is necessary for credible assignment results, an appraiser must analyze such comparable sales data as are available to indicate a value conclusion. (Oh here it is again, ANSI for the subject but not for the comps… Sort of difficult to reconcile under many scenarios the ANSI group did not even bother to consider. Now to be fair this plays both directions because in some locations the assessment data can not be deemed credible, but in other areas, existing assessment data which drives the basis for all realty and mls reporting is indeed credible, reliable, and has been carefully checked and double checked over generations as the assessors are apparently responsible stewards of this data.)
STANDARDS RULE 1-5, SALE AGREEMENTS, OPTIONS, LISTINGS, AND PRIOR SALES When the value opinion to be developed is market value, an appraiser must, if such information is available to the appraiser in the normal course of business:27(a) analyze all agreements of sale, options, and listings of the subject property current as of the effective date of the appraisal; and (Yeah, I keep analyzing those sales, verifying their stated data points with a second verification source at the assessor. It’s just nobody will be able to do that with my subject’s newly coined stated ‘ANSI compliant size.’ Matching units of measurement is such an antiquated theory. Who needs second verification sources anyways?)
The purpose of the Uniform Standards of Professional Appraisal Practice(USPAP) is to promote and maintain a high level of public trust in appraisal practice by establishing requirements for appraisers. It is essential that appraisers develop and communicate their analyses, opinions, and conclusions to intended users of their services in a manner that is meaningful and not misleading. (Because there is nothing misleading about adopting a different unit of measurement than which is applied by the local municipal legal and realty community. The words are meaningful. Which is more meaningful, matching units of measurement or mismatching units of measurement? The bi vs tri, the 2 vs bi, the tri w/ above grade vs tri with garden level, all jumbled up now. I want to go back 30 years and figure out who put garden level and basement in the same co mingled line on these forms. Just because these two items share the same line does not mean they are categorically the same space. Garden level is not the same as a basement. Again, ‘industry standards’ matter. FNMA is just one portion of the real property industry, they do not define what real property is but rather are merely tasked with bundling loans for better more secure access for Americans. As soon as everyone else adopts ANSI, it will be no big deal for appraisers to as well. Otherwise we’re on a different page with a different unit of measurement which is not going to provide clarity to anyone other than FNMA. Fannie could have simply provided clear and straight forward guidance; count the stairs, do not count foyers, do not count unheated additions which are not built to a similar standard as the majority of the real property structure itself, adhere to the local municipal standards to demonstrate your geographical competency and satisfy the Competency Rule.)
Being that we’re all qualified topographical surveyors now… That got me thinking, what specific definitions does a topographical land surveyor utilize? If we are to be literal for ‘earth level’, let’s turn to the very specialty these supposedly well crafted rules rely on.
https://learncst.com/grade-definitions/ Ignore gradient factors and only focus on grade and slope in a literal way. https://learncst.com/slope-definitions/ Gentle sloping, it’s too much for ANSI to handle. Who needs or appreciates qualifications and flexibilities regarding mild inclination of the slope? Either there is the presence of slope or the absence of slope. That’s flat lander thinking right there. Let’s treat suburbia grass areas like talus skree slope. Here is a good one: PHOTOCLINOMETRY – Determination of slopes from study of brightness in one photographic image. Welcome to the wonderful world of land surveying and defining slope. Act like in regular city suburbia with some hills we’re dealing with supplemental contours rather than basic contour. Didn’t you know, all those split levels are practically built on terraces. Never mind that some of the grade in split levels occurred due to the cut as excavators moved some earth and left some of the fill on site. / Actually not much there, disappointing. I gave it the good old boys network try at least. Control +F for pdf search. I just looked for grade and slope.
https://www.blm.gov/sites/default/files/cadastralglossary.pdf
Someone should put forth a survey with quality controls so people can not take it twice, and we should get a better handle on the appraisal communities over all welcoming or unwelcoming nature of this ANSI hardline mandate. The data should be able to be parsed on a state by state basis. One of the things we have all learned here, weather some care to admit it or not, is that in some states the ANSI rule is well received and is likely to bring about a more cohesive understanding of what is livable space, prevent some ongoing realty fraud which apparently some individual states have so far been incapable of reigning in. While in other states the ANSI rule is not generally well received, because the specific blanket one size fits all approach runs contrary to local market standards and administrative guidelines some municipalities have already put forth and codified into building and legal standards.
Someone mentioned my colorful short story as ‘a great american novel’. Hey, I don’t deserve that much credit, but thank you anyways. Pennywise for ANSI! The more basements the better. Basements basements everywhere, as far as the eye can see.
https://www.fanniemae.com/about-us/corporate-governance/fannie-mae-charter
What exactly does a measurement standard have to do with providing liquidity to the mortgage market?
https://www.fanniemae.com/about-us/corporate-governance/board-committee-charters
Obviously point the finger at the strategic initiatives and technology committee on this one.
https://www.fanniemae.com/media/28816/display
5.Outside advisors. Subject to the Conservator’s approval, the Committee shall have the authority to retain and terminate such outside counsel as it determines appropriate to assist it in the full performance of its functions. The Committee shall also have sole authority to retain and terminate such other experts and advisors as it deems appropriate to assist it in the full performance of its functions and approve any such experts’ or advisors’ fees and other retention terms. The Company shall provide for appropriate funding, as determined by the Committee, for payment of compensation to any advisor retained by the Committee. (Except in the case of ANSI standards, appraisers will need to pay for those as they are not incorporated into the selling guide, yet are now a non negotiable integrated part of the selling guide.)
Some appraisers are head over heels in support of this. We get that. If we operated in your locations we probably would want some corrections too. However, rather than using the force of government to effect people whom do no wrong and do no harm, we would have taken a more fairly balanced localized approach such as getting peoples licenses yanked or demanding the assessors do a better job or provide more detailed local municipal building code guidelines so people could not skirt their accurate reporting duties. We’ve long since accomplished most of those goals here in Colorado. We have a uniform standard in place right now. Because of that standard already existing, categorical assumptions that ANSI will bring such as ‘the average home owner can get the most consistent results’ is simply not true. The average home owner currently enjoys consistent results from everyone in the process. Or at least they used too. Now this imposition will result in a similar issue others face elsewhere, the appraiser can’t seem to get on the same page as everyone else and there will be a lot of confusion about who is right who is wrong, what the local municipal standard is, and why that municipal standard was no longer applicable, and why those municipal standards remain applicable to everyone in the process except the appraiser working with FNMA. The notion that you can disclose disclaim your way out of something like this with ANSI declarations is another fallacy, word smithing without merit. Legally that concept may be true. We’re dealing with real people, real homes, real substantial effort to bring and receive from market. People in our industries have already put in a substantial amount of time verifying existing sizing data. There has been comprehensive checks and balances in place for a long time which already include building departments, inspectors, blueprints, defined guidelines codified into municipal documents set forth by qualified managers and county authorities, re assessment, independent assessment, constant scrutiny whenever properties turn over, etc, etc. And the appraiser will show up with a different unit of measurement and different unit of comparison… Why? It’s kind of selfish to impose something on an entire group just because it works better for you personally.
independence noun
in·?de·?pen·?dence | ?in-d?-?pen-d?n(t)s
Definition of independence
1 : the quality or state of being independent
Synonyms & Antonyms for independence
Synonyms
self-dependence, self-reliance, self-subsistence, self-sufficiency, self-support
Antonyms
dependence (also dependance), reliance
What does independence mean to you?
Baggins. Thank you I think we ALL need to remember our roots and the things we are supposed to be considering. The Appraisal Gospel does not come from any lender and the REAL power over us as appraisers is not any AMC, lender or GSE. The one that can take a license and a career not just an assignment or a client is the true POWER we should aim to please. FNAM cannot remove our power to earn a living as Appraisers only we can. Our actions can cause a revocation of our licenses. WE MST REMEMBER we can survive as appraisers without FNMA but until the FEDS change the laws and Truth in Lending Act (TILA), Regulation Z, FIRREA, or the Uniform Standards of Professional Appraisal Practice (USPAP).” ALL go away… FNMA CAN NOT survive without appraisers. WE still have the power and control over ourselves. It is the story we tell ourselves and each other that gives these GSE’s the power over us.
I do not have to risk my license to work for FNMA and neither does any other appraiser.
Sidenote while I really appreciate all of your effort in finding and sharing all of the GREAT things you bring to the table here. I hope the next suggestion is not offensive because I absolutely do not intend to be,…Maybe you and I and the others can post links instead of the articles. That way it is a person’s choice if they wish to read them or not, I think we loose many good participants here when we get too much content in our posts. JMO I myself should have considered this option a few times….and I do apologize to those here that I did not consider when I did this….Just saying
This may have been the longest running blog this site ever dealt with, not sure. It challenged the existing format and patience of many readers. I’m going to have fun saying; don’t miss the follow up on this one and redirecting here now and then in the future. You know, each thread forms a life of it’s own depending on who’s participating and how much banter there may be. There is no posting limit or content limit, and that’s just a condition of this particular format, one I appreciate at least. If they need social networking for one liners they can go to twitter.
I get this concept, moving away from FNMA. And it’s what many a pro appraiser whom won’t abide amc or gse meddling has done before. The FNMA white paper on the question of amc sourcing eroding appraisal quality results in the CU system provided some indirect data we could infer from. It appears half of all licensed appraisers in the USA no longer complete GSE work, post amc era. While it appeared a substantially larger body of appraisers completed GSE work pre amc era. From the appraisers still participating, data glean indicates roughly one in four appraisers is willing to work with amc’s, the rest are not. But I just can’t bring myself to go to amc’s for the lions share, nor to step away from GSE work. I got into this industry to help the little guy, as at that time, that was me. I learned to navigate lending, bought a home, have that thing damned near paid off, and now as the shoe is on the other foot I lose sleep over liability and excess responsibility for such menial pay for the redundant task. And as new events transpire and I see ibuyer corporate entities sweeping up opportunity and wealth for themselves, falling home ownership rates, international tycoons and data brokers seeking to alter these systems for their benefit rather than the American consumer, a consistent stream of false accusations at appraisers like housing worth inequality is our fault for being racist, and a steady stream of informational and language control in an apparent technical systems take over of American housing systems, I remain concerned for our sovereign future.
If people like us can’t be there for regular American consumers, who will take our place? If it’s last man standing so be it. Although as the ANSI mandate alongside third party inspectors, lidar based 3d image scanning who’s data will be sent to unaccountable tech brokers, avm integration, desktop allowances, the pending utilization of the FNMA CU database to replace appraisers entirely indicates, standardized measurements which will benefit the largest of corporations, the war has already been lost and we’re just sweeping up some localized battles before it’s over. For appraisers who think absence from GSE participation insulates them; think again. When the GSE appraisers fall, you’ll be next in line.
“Until the feds change the law.” One of my goals is to constantly reiterate that the principals that founded this country and which led to our prosperity are worth fighting for and adhering to. “We The People.” I will help others achieve the same to the best of my ability as I find the opportunity to do so. Or maybe the appraisal position is just a job and employment. To me it was a lot more than just a job, appraisal brought me many rich experiences with people whom I provided service for, freedom of time, a break from the mundane, and many worthy personal experiences which could only happen with personal visits to so many peoples homes. They’re taking that away so the basis of why I accepted this position is crumbling away. It’s really sad, how unfair FNMA is on these matters. FNMA has consistently refused to advocate for appraisers for a very long time now. It appears that FNMA considers each and every action which causes fewer appraisers to participate in GSE systems to be a win. Otherwise it’s hard to ponder the motivation, unless there is such extreme incompetency we can not comprehend how far it has spread already. I’m not going to stop.
Baggins ,
Well said although I am the eternal optimist who believes anything is possible if we don’t let people convince us otherwise. I really like the Jamie Ownen Snip .Thank you
Here’s a few links you may find interesting
http://blog.appraisalinstitute.org/technology-can-aid-not-replace-appraisers/
This one sort of crazy with the current communication IMO
http://blog.appraisalinstitute.org/ai-fannie-mae-join-forces-to-promote-diversity-in-valuation-profession/
How about Birmingham what’s happening there… Sort of interesting to look at all the different areas and other markets.
This is sort of an example of what you were trying to explain for CO and the market there. Read the comments from that area.
https://birminghamappraisalblog.com/in-the-news/what-the-new-ansi-standard-requirement-means-for-appraisers-and-agents/
If I was not told you are living in CO I would know by the way you communicate.
All good …
The last Class I took for CE was a good class. The instructor had a list of things that lenders ask for that he very politely declines to give them as they increase liability for the appraiser.
I wished I had copied the link he gave. I will seek and try and come up with it. In the meantime here are his words on reconsideration of value.
“We must start by enforcing and reminding the requestor to submit these reconsiderations properly in terms of FMNA Guidelines and even the VA Tidewater guidelines. (Click Here to read the VA’s Guidelines.) It shouldn’t be as simple as sending over three to six comparable sales and forcing the appraiser to explain why he/she omitted these sales in the initial report. There are procedures set in place that most appraisers do not even know exist; they simply go along with the lender request to satisfy the needs of the client. The requestor must follow these rules:
• No more than three sales.
• The requestor must explain why these sales are more applicable than the ones in the report and they must include a grid.
• They must attach supported documentation/verification such as MLS sheets, maps and tax record”
“I have received several reconsideration requests in the past with only one having an attached grid because most requestors neglect attaching the supporting documents. It almost seems too easy for them to do a quick search or use CU and send over these requests just so they cover their risk. As a result, the appraiser spends valuable time answering pointless requests from the client while the sales are not even pertinent to the appraisal.”
“Appraisers must start to enforce Fannie Mae’s CU procedures before completing an absurd reconsideration of value. In addition, the appraiser should be compensated for his/her time. Appraisers should start to set a fee for each comparable sale requested in the reconsideration because time is money. If the appraiser overlooks a relevant sale that impacts the opinion of value, the appraiser should waive the fee. If appraisers make it a business practice to enforce this procedure, lenders would rethink frivolous reconsiderations of value and over time, appraisers would see a reduction of this type of revision from the clients”
He has comments he uses for requests for just about everything, cost to cure, lead paint & other FHA repairs as well as code and no conforming use requests. ALL things he refuses to address for lenders. He feels Like Doug does and states he is an appraiser not a Jack of all trades basically.
I do not deal with rov’s. Only dealt with that a handful of times. Because I provide detailed market research within the report, and as our sizing and assessment data is already reliable in it’s current form, it is obvious that I’ve put in the homework and provided apples to apples comparison. First you hone in on your target group of similar size and type, then you select the best comps pertaining to your subject. Easy.
Or it used to be until some nimwit at FNMA demanded we materially misrepresent the subject contrary to what our local municipal authorities prescribe and contrary to existing professional standards. I’ll certainly get one when readers become confused about this silly FNMA ANSI standard which nobody else around here uses.
As far as the reconsideration of value goes, that has always, at least for me, been in the LOE so, thats where it is either agreed on or not. arguing after accepting the clients terms is pointless.
Ain’t no body perfect. We are only technichens working with with imperfect judgement and other stuff. Ain’t like we are professionals and can stay in the left lane on the freeway. I’ll move over with you.
So I just had to buy the book… Here are the terms and conditions. Brilliant. Scope creep indeed. I’m not supposed to rely on any of this, everything is subject to immediate change, it’s my responsibility to read through this entire site to identify such, there are no guarantees of accuracy, and I should consult a local professional… Who am I? The sales page says; This voluntary standard… The nerve. Add false advertising to the list.
https://www.homeinnovation.com/terms_of_use
If the 2nd floor is over 7ft for over 50% & it is a 1.5 story house, do you measure the exterior as a 1.5 or measure interior deducting areas under 5 ft?
Yes
Do I take the foundation x 1.5 or do I have to measure interior & deduct areas under 5ft?
Measure the 2nd floor interior, when you don’t have 5′ of height, that is where your floor pan stops. You have to have at least 5′ of floor to ceiling height.
The 1st floor you measure the outside perimeter of the house.
I use my shoulder height as a guide…it’s 5′ so its easier, when my shoulder hits the sloped ceiling that’s when I look at the tape measure
All Appraisers HAVE to be six feet tall, no exceptions
Two things, and I am not trying to be mean about this, what have you been doing up to this point? Can the average person actually live in a house with 5 foot ceilings? I really dont get the confusion since all of these houses have been in existence for quite some time now and are nothing new. My opinion, There are no 1.5 story houses, if it has a second floor it is a 2 story no matter what the difference in size is between the 2 floors
Chris…don’t confuse 2nd floors as being 100% livable, that’s where 1.5 stories comes in..or 1.75 or even 1.25. just divide the total by the upper floor and you will get the number….you don’t have to go crazy with exact decimals…
I dont call them .5 or .75, to me they are a second floor no matter the total size so I say 2 story
This ANSI thing is really off to a great start!
Start? I have been using it since 1995.
Baggins….start ? I have been using it since 1992 ! And the people who taught me 10+ years before that.
Nothing says professionalism like ignoring local municipal guidelines.
STANDARDS RULE 1-1, GENERAL DEVELOPMENT REQUIREMENTS In developing a real property appraisal, an appraiser must:(a)be aware of, understand, and correctly employ those recognized methods and techniques that are necessary to produce a credible appraisal; (You mean perhaps like taking the time to become geographically competent and actually learn and know your LOCAL MUNICIPALITIES ordinances and guidelines for recognizing and defining residential building space? That’s a really convenient and sensible approach. No assumptions or extra ordinary assumptions needed.)
Comment: This Standards Rule recognizes that the principle of change continues to affect the manner in which appraisers perform appraisal services. Changes and developments in the real estate field have a substantial impact on the appraisal profession. Important changes in the cost and manner of constructing and marketing commercial, industrial, and residential real estate as well as changes in the legal framework in which real property rights and interests are created, conveyed, and mortgaged have resulted in corresponding changes in appraisal theory and practice. Social change has also had an effect on appraisal theory and practice. To keep abreast of these changes and developments, the appraisal profession is constantly reviewing and revising appraisal methods and techniques and devising new methods and techniques to meet new circumstances. For this reason, it is not sufficient for appraisers to simply maintain the skills and the knowledge they possess. when they become appraisers. Each appraiser must continuously improve his or her skills to remain proficient in real property appraisal. (Continually improve our skills? Like becoming aware of local municipal guidelines and not just lazily falling back on ANSI one size fits all because, well, it’s what they have been doing already for so long?)
Baggins….”Each appraiser must continuously improve his or her skills to remain proficient in real property appraisal.”
Like updating measuring to a national standard ? Sorry bud, just breaking you stones….LOL.
Each appraiser must continuously improve their skills to remain proficient in real property appraisal. Agreed, if the following holds true:
“Proficient” means being competent or skilled in doing or using something, and “Perfection” means the condition, state, or quality of being free or as free as possible from all flaws or defects.
Then, pass on the ANSI standards requiring accuracy within 1/10th of a foot per measurement and within 1 square foot overall, on a home with, say, seven corners. If your final exterior measurement closes the perimeter exactly, and if your precise final measurement matches ANY other source, I’d say you really know your stuff about ANSI standards. Otherwise, you can still be proficient. Actually, hell, we can ALL stay proficient without trying to be perfect, and if we can still estimate value within less than 5 percentage points without knowing the exact square footage…. then we remain a VERY proficient appraiser indeed. The factor we can never, ever, overlook is the ever present “market reaction” which is the prerequisite to any and all acceptable market supported adjustments. If your ANSI measurements are perfect and your market reaction factor is off, then your margin of error is far greater than the impact of being off by more than 1 square foot on your measurements. Honestly, if you are off in your measurements by even 300 square feet and your final opinion of value remains accurate overall, then you have performed what you were retained to perform and provided the service you were retained to perform. If you have provided perfect measurements, precise drawings, made your final opinion subject to double strapping on the water heater, and your opinion of value is off by $20,000, then you have performed only for those trying to gather property data, not those hiring you that need reliable indications of market value to support their decision. Not one of your clients really cares about the exact size of improvements…. they care about what happens if their borrower doesn’t pay. The reason we provide detail in the report is probably more akin to informing the borrower, especially if they are a purchaser, so that there can be no repercussions like “Geez, the appraiser was off and short by 50 square feet and I would never have paid that kind of price if I had known that”. And, of course, we never hear things like….”Geez, I sure would have been willing to pay more if I had known the appraiser was short by 50 feet”…… do we?
A gentle blend of efficiency and reasonable accuracy will support the job you were retained to perform. Beyond that, just throw in the old swimming pool and tell my why you use $20k, $50k, or $75k as an adjustment for such an amenity when you can’t see or judge the “comparable” pool and it could be anything from an undersized 25 year old drop in fiberglass unit with discoloring, undersized, unheated, and leaks…… to a recently installed black bottom solar heated Olympic sized infinity pool, or anything in between. Pool adjustments alone thus become way more critical to value than being off a few feet in, say, a 2500 square foot SFR dwelling. Promised myself to stay out of this arena for a while, but there are moments………
So true, but not often found in the practice. IMO
Chris…it is not about counting levels, but to each his own. But one could argue…1.25 is not the same as 1.75, even with similar GLA’s…think about it when you make your design adjustments. Just saying…..
Half a foot didn’t mean much in 1938 when everything else was such a gross guess. lending had greater emphases on the Borrower and the banker than in the security. We tech’s make it more important because we are not as important if we don’t! Worriers should worry, thank God we are not responsible for college loans. Imagine, loaning the ignorant to become intelligent
2.00% close enough for accuracy?
OK, I know it isn’t 1938, but say we have a $1,000,000 home that is 3,000 square feet. Site and site improvements is valued at, say, $400,000. Leaves $600,000 for the home, which is the only structure on the property. I appraise this home and measurements are off by one hundred (100) feet more or less. At a $600,000 allocation for improvements that’s about $200 p/sf for the home. Say I am off 100 feet short in measurement with a hypothetical impact of $20,000. On the million dollar home, that equates to about 2%. Not perfect, but certainly proficient. These scenarios being fairly consistent, where did we support the square footage adjustment with market reaction, and can we provide any assurance that such market reaction is within 2% of reliable every time? And, certainly not least, can we provide any assurance whatsoever that such an adjustment is even reasonable when we cannot confirm or verify the comparable square footage or even how it was determined?
OK, Borrower defaults and your report comes out of the file for the first time several years later. Any argument we may have that….. “well, the house was measured to ANSI standards”…. will likely not result in a favorable decision from your client, the lender. Let me suggest that there are many, many, oversights and irregularities that could result in a market of error greater than being off by 100 square feet in measurement, and we are only being allowed one (1) foot by the latest standard.
Seriously? Off by 100 sf or more? I have never been “off” by that much without being able to figure it out. Since I have been using a surface and Disto which sends the measurements directly to Apex, I have had Zero measurement mistakes. SO I know before I even think about leaving if something is wrong with my sketch. Even if nothing is wrong and I am “Off” by that much I spend the time needed to determine why and if I make no changes and I am correct I disclose this in the report. Besides, the lenders now require comments as to why the GLA in the report does not match public records. If you are off by 100 sf or more, you, the appraiser, probably messed up.
Chris….Well said.. They haven’t been measuring…. It’s that simple. They have been using the assessors figures and sketches their entire careers. They don’t know how to measure a house, that is what has them so freaking out.
Which is why they are moving to the standard.
Thank you for the pro mandate slander and false accusations.
One primary purpose of measuring is to determine if the assessors recorded record on home size is generally accurate or not.
And despite providing appraisal services in counties which do not furnish sketches online, we’ve just been using assessor sketches.
You know what, something is on display for everyone to see…
You are a good ANSI special interest advocate, that’s for sure.
And thats certain counties in Colorado.
Chris – you missed the point. I have never been off by 100 square feet, and if you have relied on disto as being 100% accurate, you probably messed up as well. My entire point is that exact measurements are not that critical to VALUE or MARKETABILITY…. proven by the fact that even if (in the example I gave) the appraiser IS off by 100 feet the impact on value is less than 2% overall, and any number of things besides measurements can skew a value more than that. My point is that precise measurement means nothing to the lender client unless their sole desire is to gather data for some reason other than value. It is really quite simple.
You have never been off by 100 sf? I have been “Off” by more than that. The difference is, as I have been saying, I can point to where and why there is such a difference and am 100% confident that my sketch is accurate and have had no problems explaining it in the reports. You also must never have used a Disto to assume my measurements would be off. I am guessing you are thinking I shoot on an angle that makes the distance incorrect which would be 100% incorrect as well. They state its accuracy is ± 1.0 mm / 0.04 in. I regularly verify the accuracy of mine probably once a week or two. As you said this I got out the oldest Disto I have that I got at least 18 years ago and it is still accurate at 5′, 20′, 30′ 1/2″, 50′ and 100′. So no, I am positive my measurements are the same on any sketch I have ever done with a disto if I was to go back to any older report I have done. Exact measurements are critical in being professional. When anyone that is of an age that can read a tape measure, or even just hold it up and have someone else read it, can prove the measurements on your sketch are not the same as the actual measurement on the house in question, that “appraiser” sure does appear to be any but professional. If you cant trust he or she cant measure a 10′ 3 1/2″ wall correctly how could he or she be trusted to get the value right? As an appraiser being as precise as I possibly can on anything in the report I provide is important no matter how small a part it plays in the overall report. You want a home inspector to look at a house your going to buy and say ” yea, it looks like the roof and mechanicals may last a while. They look good to you right?”. If any evil corporation wants to “gather data” they only have as far as the assessor and building departments to go to.
ANSI is a clear example of systemic deficiency in appraisal training and ongoing education. In their inability to understand local market factors, they lazily turn to a universal standard which only this specific industry is trying to adopt, and all others refuse to adopt. Outright ignoring long standing associated recognition factors such as grading slope cuts fills water tables market standards the concept of ground level with associated slope. It takes a real lunatic to call something falsely in a language counter intuitive to everyone else. Reminds me of the progressive take over of public schools we’re facing right now. If your smart you’re gifted, but if you’re severely disabled, you’re twice gifted. There are no more letter grades. True story. In appraisal if you’re competent to local standards you’re now deficient, but if you don’t have a clue what local standards are and use a metric nobody else uses, you’re competent. Make it make sense.
If competency to these people is ignoring market standards, jurisdictional guidelines on housing, confusing people whom read reports, failing to provide additional verification sources, cleverly crafting out slight oversized measurements for the subject but not the comps to boost value opinions, etc, etc. No wonder this industry is in so much trouble. Then like children they stamp their foot in the dirt and say because we said so and we’re doing it right all this time not you! More violations of basic ethical principals and competency standards.
Pepsi challenge. Post your local counties municipal building guidelines to prove to us these are commonly recognized standards in your areas. If not, you’ve accomplished nothing in a counter productive effort to change the entire housing industry from the sideline position of an appraiser. It’s time to face facts; the appraisal industry does not have the clout or representation to change a damned thing, we’re struggling just to survive in the face of mounting pressures.
This is what my senior appraiser friend told me on this matter; They intend to eliminate appraisers from mortgage lending and that’s just the way it is. We can find success on the back end with litigation and private requests from people whom actually care about market values and actually have something to lose. FNMA people have absolutely nothing to lose, why would they care about these ethical principals? Obvious is obvious, ansi appears to be a setup to drive special interests in and independent checks and balances out.
Be careful what you wish for with any universal standard. That ‘red tape’ of bureaucratic navigation on the local level is of tremendous benefit to local jurisdictions and controlling their own cities towns and counties. These people would have a universal building code across this entire country where locals are no longer in control of their own systems of building code and space recognition.
Let’s start placing bets on how long before this pathetically small ANSI workgroup which lacks cohesive well rounded national experience issues an updated book, for sale of course. If you want to affect these standards guess what; you’re now an unpaid volunteer. See how that works.
To some people appraising is mathematic competency and nothing more.
Liner regression and all that old blah, blah, blah that we don’t need in the residential market anymore (unless in extremely remote areas with no sales within 50 miles.) Now we have MARKET DATA, comparable properties, MLS, internet, online public records access, appraisal software, lasers, digital cameras and so much more. There are no more narrative reports like the ones of the past. Reports were less than 5 pages with 3 subject photos. No more unsubstantiated adjustments because now we have evolved…RIGHT?
Now we base our opinions on readily available data and anything not available… we GUESS AT!!
Funny the more technically advanced we get the further backward we go!
Question…In this requirement it seems the question for FNMA or anyone for that matter, is “Does uniformity equal accuracy or does uniformity just equal uniformity?” and ….Does that matter?
FNMA has made the statement that GLA or price per sq foot is an (if not the most important per FNMA) issue for buyers and sellers…. the MARKET. There have been added comments that consumers want accurate PP SF figures and ANSI is an attempt to provide this…. PER FNMA
The direction to round measurements, the possible addition of new added materials on an exterior wall changing the measurements and therefore the accuracy of GLA . What about lack of being able to have flat surfaces free of shrubs and obstructions to achieve accurate exterior measurements. All of this seems to suggest that accuracy is not all that achievable. Add the lack of complete and mutual understanding on the application of ANSI among professionals and it seems accuracy gets less likely. Finally, FNMA direction to treat comps as ANSI measured without inspection…. how can this be more reliable to achieve accuracy? We see that there are already great degrees of difference in how this is being interpreted and applied. So, is FNMA striving for more accurate information for consumers or is the requirement to achieve more uniformity for ease of collecting data? I think the answer is pretty clear but I certainly could be wrong.
I think maybe these 2 things are not cohesive. Just a thought
SIDE NOTE… MLS in my area just released an announcement today stating the MLS is not going to change the way GLA or measurements are reported by agents or/and owners. MLS goes on to state… There is a new rule effecting appraisers as of 4/01 which requires them to use the ANSI standard in appraising. Then a link to the standard and its application is supplied.
So for now we do have the answer many people were wondering about. Agents WILL NOT be using
ANSI.
Baggins…. Are you still losing your mind over something you cannot do anything about?
Mandates are something we ‘cannot do anything about’, and people whom support independence and resist mandates are ‘losing their minds’.
Check and check. Anything else?
Special advocate award for you Chris. Keep waving the red flag.
Baggins… I did reviews for 5 years on the most pathetic appraisals, I was paid to do a field review and then I was paid to go into the house and provide the funders of this country not the lenders, the big boys cuz there was still a loan to be had, but they needed an appraisal.
I am a proponent of the standard, because years I saw appraisers call in 4-ft finished attics as bedrooms to up the value and basically bal to their masters of the lenders.
Five full years, and every one said at the end, the field review and my appraisal and the appraisers appraisal should be sent to the state government agency for review.
I saw appraisal reports that the sketch was nowhere near what the house look like cuz they didn’t measure. And they were too dumb to even notice.
It’s long overdue
Here we go with some more typical socialism thinking. Because someone far away did something wrong, everyone must be held accountable. Don’t blame the person, blame the gun! Er, I meant the sketch method. Sometimes integrity requires doing the right thing. It certainly is a shame you did not do anything about the problem when you had the chance. But rather, disrupt other peoples well run systems by advocating for profit special interests. If there is a problem, force everyone to buy a new product subscription. Equality!
This shtick was old before it even got started.
So a bank employee whose job it was to find fault with Appraisals done by independents. I think AIR and Dodd Frank did away with that practice too because it was proven to be FLAWED.
Any time a person is paid to find errors, mistakes and improper or incorrect information… there will always be a fair amount of error or simply “bad work” discovered.
I know a person who held that position for a lender who went to prison for falsifying information. The “reviewer” knew that the more “GREAT WORK” they did the more the employer appreciated them. IT was discovered that a lot of the GREAT WORK was simply prejudicial or Biased. A few appraisers turned the QC and the lender into the State along with the rejected appraisals and they all fell down BUT THE APPRAISERS! There have been a lot of bad actors in the loan business and a lot of money made by people with low values. Some may have been appraisers, some LOs, some reviewers, some in other fields of the business. We all know stories and have had experiences.
AND I am certainly not referring to ANYONE here as I think most of the bad actors back then left the industry years ago when restrictions were tightened.
JMO
Walks like a duck……….. quacks like a duck……..Yep it’s a DUCK!!
LOL
“its not about just a value on a home, the loans need to be sold”….
As an appraiser I have never concerned myself with the loan being sold….. Not my job and has nothing to do with my job… HMMM whose concern would that be… HMMMM
I also have never said CONTROL and QUALITY and never heard any appraiser or AMC refer to it as C and Q either HMMM…
Then there’s this…
“it Is all because appraisers were cheating to keep making the deals for their clients.”
I have NEVER heard a single Appraiser make any statement even close to that!!
Appraisers know it was the “no doc no verification loan” and cheating lender EMPs that caused the issues and CRASH.
Beyond the AMCs AND AIR… the Dodd Frank set limits on how much a LO or mortgage companies could charge the borrowers. I suppose the Appraisers made the lenders OVER charge borrowers outrageous fees too (10K to 15 k per loan for a 125K mortgage)
YEP the appraisers did it….LOL
This thread is filled with things LOs say and things that are more like lending industry EMPs think. A lot of appraisers know better than some of these statements being made…
No such thing as a 1.5 or 1.75 story??… if it’s got two floors its a 2 story”???…
I really can not stop laughing.
and then there’s this…”Can the average person actually live in a house with 5 foot ceilings?”
OMG… Seriously I really cannot stop laughing…
and more…
ANSI “…
In April, 1996 the American National Standards Institute (ANSI) adopted a standard for measuring single-family residential buildings.
So before this was made a standard while the AMS was already approved and used and recognized by the Lenders… people were using ANSI when it was not yet perfected and approved for Residential use? Before it was fully developed as an approved method the lenders did not question the GLA reported or the sketches in those reports?
COME ON NOW let’s not be so Naïve here… does all of this make sense here??? Lenders allowing a little known/ not recognized… not yet fully developed and fully approved method for measuring and reporting to be used with totally different outcomes than the County? No Questions on the COMPS GLA being off of the County reported GLA?? Anyone appraising for the last 20 years (or more) knows the lenders sent revisions for everything not “TYPICAL”
Finally for those people using ANSI since the 50s or before (LOL) You must know ANSI IS VERY SPECFIC
“The ANSI standards are not law, only a voluntary guide.”
“But anyone using these standards must apply them as a whole, and not just pick out the parts they like or agree with ”
SO THIS STATES YOU HAVE TO FOLLOW THESE INSTUCTIONS FULLY AND COMPLETLY to be ANSI COMPLIANT!! No alterations on 1.5 stories or you are NOT ANSI Complaint!!
Measure the exterior of the house to the nearest inch or tenth of an inch. Measure from the exterior face of the walls. Include any features that are on the same level as the floor, such as chimneys and bay windows. Do not include the thickness of any corner trim pieces or greenhouse windows that don’t have a corresponding floor level. * Use the 100-foot tape for long wall sections and the 25-foot tape for short sections. If you can’t get close to a wall because of landscaping or other obstacles, use your screwdriver to anchor the 100-foot tape on the ground away from the wall.” VERY SPECFIC… thats good right??
NOW here’s the part where we all have to ask if we cannot stray from the method even slightly to claim ANSI COMPLIANCE… then how can we measure the comparable for an apples to apples comparison?
What is the point of measuring this precisely and then just cross your fingers and guess or take a stab at it for COMPARABLE properties in an APPRAISAL for loan purposes????
ANSI even tells you what tools to use for ANSI measuring. I AM VERY, VERY SURE THAT ANSI being as precise as all of that would never say… well just use your knowledge and experience for the other property measurements. Come on now let’s be realistic and not just reside in LALA LAND! THIS IS NOT ANSI METHODS being applied in a proper and accurate way IT IS FNMA not thinking this through.
If FNMA felt this would lead to more accuracy it must be for their files only. Appraisers using this method for more accurate GLA with the results only showing in the appraisal report and never anywhere else will not solve the problem that FNMA claims to have. We will always have to continue to guess at the information for the comparable. These ANSI results will never be available to the General public or to Realtors or to other appraisers for accurate GLA. So where is this going and why?
If my peers do not have my accurate GLA results than how does this lead to more uniformity for consumers or anyone other than the lenders themselves? just wondering.
Right now the appraisers can share information on comps that they have used in reports. I don’t even see why that is beneficial. IT’s not the subject info they are sharing just comps that they have not seen or inspected so what is the benefit of that? I opt out!
I do have a BIG concern that perhaps someone can address logically.
The last 2 years has had many properties close that did not make the contract value. They appraiser for far less than the sales price. So much so that the FEDS doubled the interest rates to stop the action. The buyers signed clauses that exempted the appraisal contingency in the contract. Now the fact that the buyers brought cash to the table over and above the appraised value IS NOT PUBLIC KNOWLEDGE. No one knows that the property sold for X but appraised for 20k or even 50k LESS than X (the selling price) other than the Lender, the agent the buyer and the Appraiser who did the report. Only the sales amount shows in the records. TO me this is a far greater problem than any we have seen since 2004-2007 . This inflates comparable sale prices thus new sales values with out the information to show that the properties did not appraise for the higher selling price. Now we see a whole new group of “comparable” to be used for appraisals to support unsupportable values.
Anyone else concerned here or is it just me? Who will be blamed for this one?
Now taxes will soar with these falsely inflated sales prices as well and that hurts ALL of us.
On rising prices yet falling short of value. That is exactly what a cash contribution towards a purchase, over and above the listing price creates, increased value. When one buyer goes up against another buyer, and a bidding war is created, these people cast their vote and chip in the bucket, to establish a new higher valuation point. The out of wallet cash payment affirms that individual sale instance of increased worth from that individual buyers perspective. Bonafide sale. The question of skewed data or an unknowable specific value in use remains.
Observing these events individually may certainly bring forth valid skepticism. Observing this behavior where buyers are up against a half dozen to multiple dozen competing offers in only several days time, and it becomes the required action to need to provide very large cash incentives and over list offers backed by solid funds, helps to measure the market reaction to increased buyer pressure. After all, the participants set the market. Buyers and sellers set the price.
Surprisingly, in a sellers market it is often the buyers whom set the value, as they’re the ones competing with each other driving both price and value upward with every instance of over list solid fund addition, and it happens more often than not. Sellers try to get ahead of it with rising prices and the value goes up anyways! I’m seeing 100% cash backed offers with contingency. It’s a lucky strike if anyone gets a deal through without some form of cash over appraisal gap contingency. The cash over is a funding guarantee stop gap, think of it that way, because they are verifiable hard funds in order to be presented that way in a contract. It’s what gets you ahead of the dozen other buyers whom already have a contract on the table.
The suggestion this overage contribution which moves the valuation needle should be reported as a concession is interesting. However, this request may be somewhat more aligned with a consistent state method of local reporting and a consistent detailed local MLS standards (for all of it’s members, of which appraisers are MLS members and are supposed to abide those local standards ) which defines a larger array of necessary data reporting points and data reporting standards. In order to have a functional MLS, all members are supposed to abide a code of conduct where they operate in a manner all the other member professionals can clearly understand and interpret. In the Denver RE Colorado, whenever we pull up a mid or full MLS data record, we get both the last list price and final sale price. The disclosure is there but such information is inferred not directly stated. Sale – List = Overage. This leaves gray area of was this the deal where they paid cash, or did they merely comp out like riding coat tails of the buyer whom paid cash before them? We’ll never know, and very interesting idea.
State rules dictate concessions to be something of value to a specific party. But is not a cash over list also something of specific value, a special concession? That money most likely went directly into the sellers pocket. Hard to say because it was also a necessary buyer expenditure to solidify the offer position ahead of other multiple interested buyers. How interesting. If that’s the new economy perhaps we should have more information on this metric, examine if the actual cash influx has sensible relationships to total market increases. Also some guy on the radio said that 80% of all fiat US currency in existence was created in the past 2 years. Is that true? Can’t be true.
So I just saw a house the other day. EASY 2 story , 4 years old ALL 90 degree angles VERY simple. One “odd” section on the second floor over the garage but no big deal. The owners had 3 appraisals so far. Assessor, who also has a sketch, shows 2652 sf. Appraisal 1 was 2612 sf, appraisal 2 was 2657 sf, third appraisal 2812 sf. The assessor, per the sketch they have, missed 2 small areas that adds up to about 20-25 sf that they missed. My measurements came to 2675. That third appraiser must be one of these NEVER ANSI guys that is all confused and scared because he made HUGE mistakes that are nearly impossible to make in basically a square house.
Chris..I did reviews, full interiors, I saw appraisers add to the measurements to “make” the deal all the time.for their masters !
I was trying to figure out how they got 2812. I have done this same model with an optional sun room that was just over 2800 sf so maybe the last appraiser just used a sketch form one with a sun room or… If I add in the deck I get close to the 2812 that one guy got. Again, SIMPLE house but proof that probably 1 out of 3 appraisers do not have a clue on how to measure a house. THAT reminds me.. A few years back I did a house and my sketch was WAY off form the last guy that did it. They sent me a copy of that other one. The appraiser was an MAI, the report was dripping with self importance and the sketch…. NOTHING like the actual house. The guy was clueless on how to measure. But, he was an MAI so I guess fact is what he says it is.
Chris…The worse appraisals I ever saw were from commercial appraisers who had NO business touching residential. The mistakes were huge, some thought being located on a major traffic arteries was a positive…because in commercial, being on a busy street is a positive….they never gave any value to amenities or even site size, plus or minus. There were so many issues that the reports had to be re-written, lucky me…lol. The REAL problem in our profession is these commercial guys dominate the appraisal institute and others.
Have to agree with BA here. Spoken like someone whom is not an appraiser.
Now more slander towards appraisers. You certainly are a dynamic ansi and automation advocate.
Face it, the jig is up. The tag team shtick is just the cherry on top.
If you have to engage in identity fraud and misrepresentation to sell your products…
198.204. …………………….
Baggins…I am losing respect for you my friend….all over a standard of measurement…. Really??? Are you seriously trying to justify your feeble stance by saying Chris and I are not real appraisers?
But hey…its the cancel culture of the right these days…..Jack Nicholson comes to mind…you cant handle the truth.
You crossed that bridge a long time ago. And how you feel about me, one of those appraisers whom answers his masters, irrelevant.
Those scenarios… I can’t recall one single time I had access to three different sketches when asked to complete one myself. Anyone else?
Too bad the appraisers were not relying on bonafide verifiable information sources.
The sellers of the house asked me at the end why 3 different appraisers got 3 different size living areas. They told me exactly what the differences were. Maybe you just havent had much experience in the field or possibly the way you conduced yourself they felt asking you such a question would not be answered to their satisfaction. I have had many times when people came back to me asking about why my gla was not the same as other appraisals they had. Since they had copies I was always able to tell them why. Not once was I proven wrong on my sketches. This is so simple a 5 year old can do it, just measure and use that exact measurement.
Actually, the sellers did say that they wanted to ask me because they noticed I was taking a bunch of measurements inside the house they never saw the other appraisers do. I explained, and showed them, why I was taking interior measurements. Thats when they asked me about the other 3 appraisers. I was doing my job and it was obvious to them I was taking it seriously and professionally. They wanted a professional answer and they got one along with a very accurate and professional sketch.
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This is all over people getting upset that they have to actually measure a house and use the ACTUAL measurements. Imagine you buy a new house, to be built, you agree on the exact house and plans but the contractors went by the sizes they felt was easier to build no matter what the plans called for. I guess they would have no problem with that. whats 200, 300 or 400 sq ft difference anyway. You paid for “A house” you got “a house” who cares what size it was supposed to be. You now have a 19 foot deep and 18 foot wide garage to fit 3 cars in. Its ok measurements can be rounded, things are easier that way.
What would someone who is not an appraiser be doing in this “trending” forum? If you are not an appraiser why are you even looking over the posts? What kind of person would have to pretend to be an appraiser and post things about measuring houses? Based on my experience hiring (firing) and attending CE seminars for the last 27 years, I can say that Appraisers are a very sad group of people. Going to a CE seminar is like going to a circus.
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Chris..I agree 100%. No wonder I became to go to guy for the big funders in this country…I took over 30-50% of my lenders…the funders told them if they want their paper then they had to call me….Half my clients hated me for doing my job…I had so much fun with them…..most were under 25 years old, taught how to lie to borrowers, max the fees out, points on the back end…don’t pay your credit cards cause we will have your loan done by the time the credit gods report, then they raped them at the settlement table…we used to call it table rape.
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Well aren’t you the proud one there CHRIS or chris chris or the other CHRIS or chris . LOL….so really crazy
I was wondering when you were going to spill the beans here. So LO or 1 of the 1000-s of “Mortgage Company Owners” who did everything and anything to make a killing and then blamed all you did that was illegal on the APPRAISERS..
OR maybe just a revoked licensee?
Well all I can say is good for you buddy, sorry it didn’t work out for you after you quit the very lucrative job you mentioned to be in the industry and then the FEDS shut you and the secondary market down because of things like “table rape”. Seen it tried and shut it down…. walked right out the door with my clients in front of me!!
So 30 years of CE and the only way you could make a living was Table Rape??? AND NOW YOU PUSH ANSI for accuracy???
Ok now let’s get down from your high horse of greatness and discuss things that are real, and not your silly ego and made up success stories. Really you more than likely do have something worthwhile to contribute so let’s get with it. True and worthwhile experiences and no bed time stories or boring fairy tales you tell yourself late at night or others just for kicks.
I notice you say ” Appraisers are a very sad group” ….as if you are not part of that group. !!! HMMMM well that sort of says it all. I learned a long time ago if you listen long enough to what another person says over time….THE TRUTH WILL COME OUT.
Focus groups… “watchers” market researchers and even LE get on these forms all the time to glean information, check reactions and simply get to the pulse of any matter they want to investigate.
REALLY you did not know this ??? LO
So then the answer is yes, you are one of those appraisers I am talking about since you dont know what I am talking about.
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BA… I am the appraiser who brought up table rate.
I understand you were a little confused over the two different Chris’s that are responding on this site.
When I respond to Chris, I use Chris Chris.
Because I became really good at doing appraisals, on exceptionally difficult properties, my name went through the industry as being the appraiser go to guy by the big funders.
When the funders needed to have an appraisal rereading because they were still alone and they didn’t want to jeopardize their pool of money, they called me.
I had to do a field review in order to discredit the current appraisal, and they could not risk their pool by including it because the investors could reject the entire pool.
In order to get the loan done they needed an appraisal. I learned a lot during those years, there are many appraisers in the Philadelphia market area and surrounding area that should have had their licensees removed.
The funders gave me the same story, we like the lender, this appraiser doesn’t commit fraud all the time, we just have to weed out the fraudulent ones.
That was until mid 2005, when the mortgage buy back started.
I’ve been asked to handle license revocation cases in Harrisburg or state capital.
I did not want to do that so I quoted $500 an hour including drive time, when I tell you I was talking to the big boys, I’m talking the owners of these funders.
I was also asked to check out the borrowers, to see if they were thinking of taking off with the money and not paying the loan back, so I set up what we called quality controller appraisals, I was paid full fee to talk to the borrowers to see what they were up to and then report it back to these funders.
You have no idea of my experience, you accuse me of bragging, when all I’m trying to do is tell you I’m not some little minion appraiser who was taught by their mommy or daddy and got by.
I was taught by the best, and then I got better.
Only because I hate underwriters, am I second most client sent me the underwriter check off list of how they grade appraisals, I’m going back to 1998, so once I knew with the underwriters looked for, and I didn’t want to be bothered with underwriter letters so everything was included in the appraisal that they could possibly ask for.
I made more money because it is, I became respected in the industry, thousands of people across the country know my name.
I was loved and I was despised, so bad, but they still called me to do their appraisals.
This block is about a standardization of measurement for appraisers, I do not mind talking about other things, I think it is good for all of us to vent frustrations.
I don’t understand why some appraisers are upset over a standardization that frankly has been around for the rest of us for at least 15 to 20 years.
And some of us have actually been using ANSI for our entire careers. In my opinion some of the arguments against the standardization are unreasonable.
It takes a special person to be able to handle being a real estate appraiser.
I have spoken to many prior to submitting my review appraisals.
I would call them, and ask why they did what they did, and they all said the same answer, they were afraid of losing their clients.
I did not like to move to management companies, it cost me my office, we were charging $350 for an appraisal in the next day the management companies were only offering 200, stealing 90% of our profit margin from us.
I survived doing FHA deals until December, and then I jumped to a national lender as a staff appraiser and made a small fortune handling all their short sales and foreclosures in the worst counties in the country.
I got very lucky after leaving them, and I am very happy, and I have not worked for a management company ever.
But my partner who I taught, had to put up with the management companies, she sat next to me every day, I heard every story, one even canceled an appraisal when she was 10 minutes away from the house because they found an appraiser to do it for $25 less.
After 2 weeks she was accidentally sent the underwriter letter, asking for 15 mistakes to be corrected, she politely said I was not the appraiser on the job please send it to the appraiser that did the job.
A week later there was another 10 steps, she politely replied to same thing I was not the appraiser please send to the appraiser that you utilized.
5 days later she got another letter with another 5 steps, this time she said to the management company, call the appraiser that you use to save $15 to $25, your appraisal would have been done within 3 days from the inspection perfectly, so stop emailing me the underwriter steps.
Like I said before, this website is great for appraisers to vent their frustrations, and these days we have many many more frustrations, it’s just a reality of current times.
I do not want to personally attack you, I always say we are all in this together, it is a shame that we could not nationalize on the national level and tell these lenders and management companies the rules.
I called over 180 appraisers, when HVCC came out, they all said the same story, but the other appraisers won’t go along with the union.
I used to tell them, the nude models in this country that stand in front of college students in cold conditions for hours at end, we’re able to unionize to get better wages and better working conditions.
And we appraisers, could not organize ourselves, they did at the state level, but they did not do it at the national level.
I blame the appraisal institute, they are run by commercial appraisers who could care less about residential appraisers.
I wish you well in your business and your life, I have no ill feelings to anybody that opposes my opinions, I try not to insult them, but at the same time I try to get them to think.
But in the end, it’s a waste of my breath and I have known this for over 40 years.
I am 56 years old and in the next 60 days I will retire to Asia and live a life of paradise, I will come back to this country for 4 months, make $70,000, and live the dream. I will spend 30 days in every country getting to know the locals and tasting their food and wine, and I will sit back and read these blogs and I will wish the best for all of you.
First let me say I never accused you or anyone of “bragging.” That was not me. Other people have commented on that not me.
I do feel you spend a lot of time repeating your accomplishments over and over and how well you were loved by the very people in the industry that WE as Americans had to bail out due to their lack of good policy and collateralization of funds. May be sort of ironic to many of us here IMO Just saying…
I also feel you have spent a serious amount of time calling all of us morons, stupid and incapable. I did state that you need to start reading what is posted and not just rush to post inaccuracies because you don’t read. You and the other guy if there is one comment that you are the only ones who know how to measure, Sketch and do it right!! REALLY ?
You do not know any of us, our skill levels, are Histories or our work product yet you make some pretty serious negative judgements on all of us but the other CHRIS or chris, or chris chris!!
You don’t know if I have a PHD in Economics, Valuations and marketing or if I am a part time appraiser… full time Walmart greeter! I don’t think you know anything about any or all of the others you have continued to attack and insult either. JMO
BUT if you bother to read and if you are as good as you continue to say you are then why not address the real issues and valid concerns NOT about ANSI but about the lack of consideration by FNMA to consider the MARKET, the lack of direction and even common sense in the adjustments AND the simple lack of truth on why this is being implemented in a way that ONLY benefits FNMA and its investors. Why not be truthful when they are GSE? Our money keeps them in business!! Further WE all know they are trying to circumvent the very appraisers supplying them the data they need to be successful.
So I would love to read your comments and to have you read all of those here as well and add good knowledgeable comments to the forum. Doug, Baggins, Martin and many others are brilliant in my opinion and their concerns are VALID and need acknowledged IMO
So I will surely read and appreciate your input. If you could just stop belittling everyone… that would be great!! and please think about this… You are claiming skill and tremendous knowledge while agreeing with a guy who says “there are no 1.5 story homes and asks can anyone really live in a home with 5 foot ceilings? “and says “just guess at the comps GLA,” while calling the rest of us morons!!
That is simply NOT contributing anything useful in my opinion. Sorry
I, and I guess the other Chris are simply pointing out that a standardized method of measuring is nothing to get upset about the way most here seem to be and coming up with wild scenarios about basements and no second floors. Reading all of these comments indicates that many appraisers really do not know how to measure and it seems that if we were to take all of the anti ANSI people here and have them measure the same house there would be HUGE differences in living areas and basements. That is alarming. Those who are not scared of ANSI have been using it as long as we have been appraising and honestly thought that is how everyone was measuring. I have seen reports with horribly wrong sketches and in my mind chalked it up to lazy (copy the assessors sketch when available or rounded where every length was a nice round number) or inexperienced appraisers. Out of all the things that can be different in an appraisal (say there were 10 appraisals on one house), the living area should NEVER be one of those things no matter where the appraisers are from or how much experience they have. I cant believe anyone would argue against that. All of these “world ending” scenarios I am reading… They are nothing new! The Cape Cod or Bungalow with dormers and low ceilings are not new houses. What has everyone done up to now? How did you get and verify GLA before? To me it seems most were just guessing with no real proof or method that would stand up to scrutiny. I have not seen anyone here say they are superior to anyone. I know I am not and thats why I am so amazed at all of this. I have no more than average intelligence and no better than average skills appraising and I am able to easily comprehend ANSI and have always used it. If I can do it there is no reason any person could not either. This is no a plot to remove all appraisers, if that was the goal, all the information needed is available from every assessor, recorder, county treasurer and building department in every county of every state in this country. I am “for this” because to me, it would give the impression that appraisers might know what they are doing. IF the most basic thing about a house cant be consistent between all appraisers, there is a problem. When reviewing reports one of the first things I do is look at the sketch, from that I can tell what kind of report it will probably be.
I really hope you will read this as it is evident either you are not reading the comments or there may be comprehension / communication issues that we need to break through.
As I have stated many times before but you and the other Chris choose to disregard…. I already do and have been measuring “CORRECTLY”. I can show you reports from 20 years ago showing commentary in my reports about the 5 foot ceiling height and open foyers and all the rest as stated in ANSI. So please MOVE ON…
I am sure many of the people here have been measuring correctly as well.
ONE last time AND hopefully you will be open minded enough to comprehend/or at least consider these things. The problem is not ANSI or any other standardized method, as you want to beat the drums and say here.
Evidently you do not understand that ANSI was not designed for appraisal purposes. IT was suggested as the most uniform and accurate way to measure. It is a standard system for everything from shoes to screwdrivers and all else in between requiring sizing.
Now what if someone told you that all tools had to be metric from May 1st forward? What about all the items that require decimal already in the homes of millions across the US.? Would you expect everyone to just throw the items they own that are not metric away? It is an internationally recognized system so it must be the best right?
But not everyone knows it and not everyone wants to use it and no one wants to replace all they own that requires the decimal system for the now required metrics. Further not everyone will be on board at the same time and THIS will create a MESS!! (Very basic example here) Manufactures make both system because there is demand for both even if you feel one is better not everyone feels, thinks, needs or WANTS what you do. THE PUBLIC …THE MARKET determines this.
We have markets and market segments which are used to determine reaction of humans to everything that is made, built , consumed and manufactured. But here you have FNMA denying a Market reaction simply for uniformity of GLA.
That is just one concern that this is about here! That and so much more but it is NOT ONLY about measuring a home with ANSI.
The Vegetarian market is now a large percent of grocery sales. Organic is even bigger now. Vegan is a newer and expanding market for us in the US. Green living is another one and so are energy efficient appliances. Electric cars are increasing very quickly in sales. There many more … on and on! All of these are offered because the public want them and now demands them. In the 60’s TV dinners were a rage. 1000 sq foot ranch homes were desired and 1.5 stories were offed as a budget friendly family home. ALL had great market acceptance. Many still have good to very good acceptance today. The 1000 Sq ft home was replaced through public demand by the 2400 sq ft 2 story in the 80’s BUT there are STILL a lot of those ranches left and they are still selling well because of MARKET acceptance. FHA used to have a GLA limit and now does not. Why… because public perception and therefore demand AND Value changed. Now TINY houses are desirable in many areas and can be financed.
FNMA says NO to the MARKET and yes to accurate measurements. Well friend the market determines desirability, it determines acceptance and the market determines VALUE. If the public wants open floor plans and 4 room homes then builders will build them. Architect will design them and decorators will decorate then and furniture manufactures will supply more versatile furniture to furnish them. Public demand, opinion, requirements and public view on values ARE THE MOST important part of all facets of consumer products and the housing market as well.
But now to accomplish uniform measurements we are told to disregard public acceptance and MARKET REACTION!! We are told ALL areas are the same!! FNMA an entity that is not qualified to tell the PUBLIC or the MARKET what they want, what they accept and what they value is now saying forget THEM they don’t figure into the equation anymore!!. That is just a small part of what I am here objecting to. FNMA direction on the adjustment of GLA that I have no way to obtain and then confirm is against EVERYTING I know about appraising and about accurate data. About researching for a reliable conclusion. You can not adjust what you do not know… at least I can’t and I am not going to mislead anyone into thinking I can.
To separate out the MARKET accepted GLA and to say that the other area which is ALSO HISTORICALLY MARKET accepted as GLA as well and give it a lesser or greater value with out DATA from the market is simply wrong and more misleading that anything we have known before IMO. Yes 1.5 stories have been around for years and entire families were raised in them. But now we decide that no one wants them anymore because there are areas with lower ceiling heights. Well that is NOT what the MARKET SHOWS. Further to subtract GLA in 1.5 stories makes the PPSF soar and that is also misleading IMO. So with this a 1.5 story is worth more per sq ft than a 2 story!! There are a lot of questions and much more to consider than GLA being accurate. What about EVERYTHING ELSE being misrepresented to the public? WE DO NOT HAVE MARKET DATA TO SUPPORT adjustments on the newly grid levels yet as this is not YET a market accepted theory or concept (it may never be in certain areas) So now we have a dilemma. Which is more important MARKET acceptance on GLA or ANSI standard GLA. How do you accurately adjust for anything that does not have MARKET acceptance? How do you support adjustments that do not have enough information on to have data to support?? Now we are guessing at adjustments and the public and all else in the housing industry is questioning all of it and US!!
So please understand the Earth is not flat and there is more to the FNMA requirement than simply measuring a property. ALL JMO humble opinion… or concern.
As to the other statement you made. First let’s just go back and read the comments about “all of these CRY BABIES not knowing how to measure!” Come on now for weeks we see over and over “that the rest of us are morons and we don’t know anything” and more. So please don’t make it worse by acting like we simply misunderstood or like it was not written. OK? Let’s just move on.
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BA… Like I said…if it walks like a duck and quacks like a duck over and over and over …then it is a duck.
Once you start to separate these areas and adjust separately, you will see the value differences these area have to the MARKET. If you haven’t been doing this.. like most of us, you simply don’t get it yet. But you will eventually.
This ANSI thing is nothing more to make you better appraisers and just not relaying on 1 GLA figure dictate your reports.
Why would someone promote a for profit product? I just can’t figure this one out.
https://www.ansi.org/outreach/government/ansi-activities
Baggins…siding for profit ??? Really…..a measurement standard ??? You just can not see the forest through the trees. Its a common problem these days with Americans…..well half of us any.
Do you really think this is a conspiracy?
5′ 3″ is 5’3″ not 5′ how does taking out that 1,2 or 3 inches make you a better appraiser? Anyone with a simple measuring tape can prove you cant measure. And your response is, adding in that few inches is to taxing on me and too time consuming? How does it feel that any non appraiser can prove your measurements wrong within a few minutes? How professional does that make appraisers as a group look? I wonder do you have a disclaimer in all your reports that the actual measurements are not what is used in your report? If not, I would think an angry lawyer you piss off could make a good case to the disciplinary board that you are not competent
Chris…I keep asking them what were they doing before ? None have responded…tells me they were not measuring subjects….Can you imagine not measuring and just relaying on an assessor or builder or realtor…. ???
How dumb are they? Oh..never mind… and they are NOW crying about liability??? And everything else BUT actually measuring the right size……baffling !!!
The sketch and measuring is probably the easiest part of the entire process. I guess its even easier when you only pretend to do it.
Chris….I agree, however the crazy houses can add 1-2 hours to our inspections and sketches when all is done…..that is what they are crying about.
I enjoy those. Its a challenge and the result is always satisfying. Most of this can get real boring.
Baggins, Wait… are you the same guy who says he gets at least $4,000 an appraisal (Residential) and commonly gets $20,000?
Chris…Yes…I do ChrisChris when talking to you so it doesn’t get confusing. The most I was ever paid was $4,000 for a mufti-million dollar property….My buddy just was paid $12,000 to do a 12,000 sqft house, no one wanted it so he priced it high, there was no one to call…LOL When I did court appearances I was paid $2,000 to noon time, if it went over by even 1 minute, I was paid $4,000. for the day. When I was younger and I was charging $350 (way back when) when the industry was till charging $250, 275, 300, I doubled my fees to $700 to go across PA, New Jersey and Delaware states.My clients paid me to go so they didn’t have to call the monkeys in these back water counties. I had a ball, I never got lost, I found places I had never been. they would do mass mail drops, They had plenty of work not far away, and that was even before computers and when we had to use comp books, once the computers came out, it was even easier. And that was way before GPS….LOL I dictated my turn times, no one else, if you didn’t like it, i told them to call a different appraiser next time…..Once they saw my reports flying through underwriting i was their #1 guy. I don’t play games, I don’t lie, I don’t take B.S. from no one !!! I was taught by the best and then I got even better.
There is a guy on one of these forums that said he gets minimum $2,000 for a Standard 1004 report which he said was on the low side.
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That actually happened to me. Training a guy and as we start and I am showing how to measure he quit because I wanted it to be accurate. He walk off right there. He said why do you want to waste time like this?
Chris…not sure if you re talking to me…no I never quit, did my whole training with the same company…I still miss those days…they had 25 appraisers with 25 assistants and the most beautiful girls typing our handwritten reports…then we got DOS, then windows, then digital cameras.
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Sorry, no. You have a realistic view of all thats going on. I was directing that/those comments to the ones who feel I, and I guess you, are not really appraisers and are trying to infiltrate the appraisal community to implement the dreaded ANSI standard. But then, how would I know… Im just pretending to be an appraiser.
Chris..I understand LOL, appraisers can charge what they want, if there is no one else to call…..He/She may be doing high end homes no one want to do….who knows…
Nobody is promoting anything. I, and a few others here, are seeing the need for a standardized form of measurement. Any home owner with any house in any city in this entire country should be able to expect that ANY appraiser from ANYWHERE in this country could come by this house, measure it and end up with a total GLA that is within a few sf of each other. A few, 10 to maybe even 50 sf. But people are getting results of 100 or more form just a few appraisers. If I was the home owners I would think the appraisals are a scam too. This is all very simple 3rd grade stuff. Measure and use that measurement. If you cant stand up in an area dont count it as living area, if there is no floor you can stand on, dont pretend there is and add that area in as if there was a floor. SIMPLE! Even a low IQ person like me gets it.
A conspiracy to make us use specific measuring devices or use actual measurements… YEA that’s it! SO Evil
I’m not so sure that there are so MANY appraisers in the US that do not have a clue as to how to measure. IMO There are just too many safety or red flag alerts in place to stop these “unknowledgeable” people to continue in this industry. Sq footage/GLA does not necessarily increase value and it’s not the way the crooked guys cheat. It is too easily discovered just as you all point out here..
Out of immediate market area for comps is the number 1 way Realtors CMAs achieve high values to “buy listings” and bad appraisers often use this too. Unsupported adjustments, condition, amenities as well as false statements, adjustments for rooms, bathrooms and garages all are the top of the cheating chart. Some of these things area easily seen and some not so easily…. easy to catch GLA not so much used in escalating value cause comps need to be with on 20% tops so you cant get too much value there, nothing crazy at least.
I was sent an appraisal (buy the owner) on a home that was a typical 2 story open foyer 2 story great room completed for purchase transaction in 2018. All 3 comps were in the 2700-2800 GLA range but with ANSI the correct subject GLA was really 2432. (you know open foyer and 2 story great room) The comps 1-2 miles did not support value so distance was increased by the appraiser to 4.5 miles to a lake area community market. Subject had an above ground pool not anything fancy. Subject was a 1992 built with no updates or remodeling. . The lake area comp with a 400K sale had a 60 x 40 pole barn 2017, 3 bay vehicle storage with workshop and bathroom . IT also had a 20 x 40 inground pool with an out door kitchen in a fabulous shelter with a bath, changing room, theater area and bar all in 2015 to 2019. Really over the top. The other comps were 325 K and 355 K just ordinary 2 story built in 1992 and 1996. The subject had no pole barn or added car storage . Only a cheep PERSONL PROPERTY above ground pool and nothing else. All properties were on 2 to 5 acres lots. The contract sale price was 375 K for the subject. The 400K comp was far from a comparable but the appraiser needed it to make value for the loan.
The appraiser adjusted + for the pool in the subject , did not correctly measure and then did a 40 K adjustment for + condition on comps 1 and 2. WA..LA.. 380K opinion of value!! Sale Closed.
I would love to send everyone the exterior and interiors of the comps and the subject and the appraisers report to show everyone how glaring the manipulation was in this. As much as I agree the GLA was certainly wrong, which any QC or underwriter could tell… (County showed 2426 for the subject by the way.) The fact that page 1 showed above ground pool and the grid gave a + adjustment to the subject and the fact that the GLA was over all reported sources, the interior showed no updates. The pole building, shelter and pool amenities in the 400K comp were adjusted very slightly – to the subject. Even a total Moran could see that comp 3 was so far superior to the subject….farther away in a higher priced market and all the interior & exterior pictures were right there on the internet!! This subject was inflated by over 50 to 60K!!
So who do we blame here??? In my opinion the QC, the underwriter and the LENDER ! Anyone can see what happened here and the GLA being wrong WAS NOT the reason this closed at a value that was not supported by any appraisal. Since that time I have seen 3 more appraisals on the same home completed in the past 1.5 years and ALL showed value opinions of 325 K to 365 tops. Now the appraiser who committed this egress action could not be successfully with out the compliancy of the REST of the people charged with marking sure the loan was properly collateralized..
This appraiser should have been suspended, fined and made to complete more education a LONG TIME AGO. But the AMC and the mortgage company and all the rest in the line allowed him to continue.
That is ALSO a CRIME IMO and yet none of the others will ever be caught and punished!!
The lenders love appraisers “mistakes or omissions” but when the reports are so bad that a novice can see the poor quality shouldn’t the lender be called on the carpet and fined/and or suspended as well.?
We now are seeing 2 appraisals on the same asst more and more often. IMO GLA is really not the biggest problem here. JMO
BA…I know head reviewers and FHA reviewers, I hear all the time half the appraisers have no idea of what they are really doing…..the simple fact of the matter is that there is not enough appraisers anymore, they get a slap on the wrist, maybe a class and that it.
That is why the big boys are moving away form appraisers. Also Why they are moving to ANSI, just not about measuring to the inch, but a uniform way of reporting GLA.
When the big lenders out there create their own “den” of in house appraisers for $30.00/hr, they will then use the Grab drives to measure houses and take pics and videos.
As the work goes down in the next year or too, appraisers will be falling over themselves to make a living….Banks make more, appraisers make less. They don’t care. Hungry appraisers make deals.
Well I do agree the banks are trying to remove appraiser from the mortgage lending field.
That’s why they screamed for more education and more qualifications in 2006. (to make it harder for appraiser to increase in numbers) That’s why they insisted they would only use Certified Appraisers in 2008 and after. That’s why they developed desk top reports and on and on and on. This has been going on for WELL over 30 years. They don’t like us because we keep the system more reliable. WE are the ones who show investors their funds are collateralized This year its ANSI and next year it will be another bogus nonsensical demand. (not that uniform standards for measuring or ANSI is bad because it isn’t. IMO). The way the undereducated in Appraisal practice and unknowing of the methods and requirements are trying to apply it in appraising has nothing to do with ANSI, THE MARKET logic or even common sense. Their way is more than misleading and far from accurate. We have ALL pointed out many VAILD reasons it is no good this way.
IMO It is only a matter of time before the REAL powers step in and cancel FNMA ability to demand this nonsense. We all have seen it before… rules are put in place then revoked all together. Now the requirements are less stringent than 2006. Now lenders allow Apprentices, and now things are starting to revert to less lender control and more clear support for appraisers. NOW the AMC are licensed and now the FEE PAID to the appraiser HAS to be disclosed. Thes guys just can not play fair no matter what and will never be allowed to have a more free rein to do more wrong IMO.
. We are not going away any more than the FERA, TILA , Consumer Protection and the CFS Act. Do you really believe that all the protection put in place because of “MR Potter” ways and rules in banking were killing the public are going to go away? LOL you silly boy… all of the safe guards were put in place because the “big boys” as you call them were committing criminal acts against the consumers. If permitted they would still do so. AIR and all the other RULES, LAWS and decisions are in place because the “big boys” really screwed up many times over years and years of nonsense and in 2004, 05 and 06 and WE had to bail them out. They CAN not get rid of appraisers because everyone with a bit of intelligence knows that they are not capable of doing the right things.
I was a staff appraiser. One of the biggest mortgage lenders in the US could not provide enough business in this State to keep the Staff Appraisers busy. They went back to independents within a year and a half. They do not pay Staffers enough to keep the lights on and what they did pay was too much for them to keep going. 16 appraisals a month for 2000.00 GROSS a month!! Not many will work for that! That very low salary was the only way they can make money due to the required benefits!
There are good guys in the industry as well and THEY all support Appraisal independence and encourage a roll back in the requirements to increase the numbers in our profession.
So please stop with the dooms day stuff already. We aren’t going anywhere soon!
I have to say, the purpose of this site has lost its interest to me as it has gone way beyond meaningful information and discussions. What is happening now discredits all those who actually contributed meaningful information. The blog has morphed into a soap box stand for bragging rights. It has turned into the second coming of the “almighty appraiser” who passes judgement upon others; slandering and pointing fingers at others is not what is needed at this time. I, for one, could care less about the incessant war stories and how the day was saved…hi-o silver; we all have them. This endless litany of bragging is boring to say the least. It is unfortunate this is happening as, for a while there, the blog was getting pretty good. This nonsense has reduced the blog relevance to a self-serving, mundane talk show. Take some of that energy and do something constructive. To those that took the time to provide meaningful information I am grateful for your insight and information. I’m out….
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Since this discussion got off track, I have not interjected with any comments, but I want to describe a scenario in which there needs to be more leeway for when ANSI standards are not possible for a report. I am sure for those of you with mathematical or engineer-like thinking would be able to figure it out relatively simply, but my brain hurts because of the whole “below grade” criteria. This is the first appraisal I have done of a multi-level property since April 1, and it is killing me and making me want to find another career. Here it is: The subject is a front to back multi-level. Four levels with one level being a garden level (considered GLA by the market here) and one level which is true basement area.
The market would consider this 1813/sf of GLA (Three of the levels) with a fourth level of 494/sf finished basement. But, with ANSI, I now have to consider the subject to have 1248/sf GLA with 1055/sf of Basement (100% finished). I have two smaller comparables that are luckily similar front to back multilevel floor plans, but the actual 100% subterranean basement areas are not completely finished. So now, after breaking out the garden levels of these two comps, one has 1072/sf GLA and 1093/GLA. I make my adjustment for GLA ($115/sf). Easy enough so far. But now for both comps I have to break out the “basement” square footage that is considered GLA by the market to I can also adjust that at $115/sf and break out the actual finished and unfinished basement square footage so I can adjust those at $20/sf. Of course, there is no way to do this cleanly and easily in the Alamode Total software, so I have to do this all on a spread sheet so the underwriters can see why the adjustments are all over the place for the basement area and not consistent with one another. I am extremely lucky that the garden level portions are nearly the same size, so I don’t have to consider and make a separate adjustment for the garden level basement area which would be at $115/sf. Ultimately, after adding and/or subtracting all of the differences for the actual basement areas. the final adjustment amount is very inconsistent for both comps. It works out in the end, but it was a hell of a lot more work to get there. But the real problem is there are no similar comps for a third or more comps. The only other comps are side by side multilevels (four levels), none of which have a garden level. They all have three levels above grade, and a true basement level. So, the third comp I am attempting to use has a much larger GLA and a much smaller basement area per ANSI standards. Where I used to only have to make adjustments for total basement area and finished basement area, now I have to figure out three or four different adjustments, and add/subtract them together for a final adjustment number. For this comp, I need to consider the subject’s “basement” area that the market says is GLA and adjust at $115, then take the difference of the true basement’s unfinished area to adjust at $20/sf and the difference of the true basement’s finished area at $20/sf. Then I have to add/subtract those three numbers with each other to conclude to a total adjustment number to put in the grid. It is no longer as simple as making one unfinished basement area adjustment and one finished area adjustment because the finished area requires adjustments at both $115 and $20. This is exhausting just trying to explain this, and if you’ve read this far, it probably doesn’t even make sense. One I figure out the numbers, I have to explain all of this to the underwriter/reader of the report so they know what is going on? My brain is cooked. I’m going to go get a very tall glass of bourbon.
Hang in there we all (or most of us) feel your pain and many will be adding to the liquor cabinet for use after multi-level assignments.
Oh it makes perfect sense RedBeef. It’s just there are some people here whom can’t get their mind around general competency, development requirements, and the compelling factors of peer standards within their own jurisdictions municipal rules and pre existing MLS member services clear as day definitions of how ‘all the MLS members’ are supposed to recognize and document housing space. The consistent response was; once appraisers combine garden and basement, they’ll see the below grade areas don’t track the same as above grade. Clearly for those of us in markets where garden level is tracking same as fully above grade, these are wildly false and easily provably incorrect assumptions. Because garden levels are not basements. Garden levels are ground floor levels. Basements are not ground floor levels.
They’re going to need 3 lines on the FNMA forms; AGLA, garden, and ‘fully below grade’ basement.
Better not juggle them or you’ll drive up net gross indicators. Better not try and combine them with a varied adjustment basis or you’ll confuse automated reviews, human reviewers, will fire auto alerts and you’ll deal with stips routinely (most will probably not bother with your spread sheet review). Better not cross comp various split level types or you’ll make an absolute mess of the analysis and people will not be able to interpret or understand the appraisers methods unless they’re an ANSI elitist.
One option: Fill the grid and complete the sketch as you normally would. I also suggest supplementing MLS data of comparables into reports, so readers can clearly see ‘the local market’ does not recognize ANSI. Then that’s a clean and simple normal report as you’ve always done. Take a screen capture, include it as a jpg or pdf. Then butcher your analysis, drive up net/gross, improperly combine garden and basement, and provide clear contrasting data how ANSI took what was a working method and destroyed important analytical and comparative benchmarks in the report. Include a note you can turn it back to the image capture ‘traditional method’ if the lender will approve use of the GXX001 – ANSI exception code. For the first time in your appraisal career, hope for a revision request on that specific point.
Second option is to reserve the garden/basement level 1004 line for one or the other, but do not combine them. Like scoot garden level to it’s own line item. This will at least save all your net/gross indicators and you won’t have to deal with the conundrum of applying mis matching spaces with mis matching adjustment basis, as their market reactions are different from each other. Because; (drumroll), a garden level is not a basement. You will however lose all your side by side adjustment assist.
The very fact this happened at all and you are in a market location which does not recognize garden levels as basements (because they are not), means you have just lost the entirety of your personal and shared comps databases. Everything must start over. You have just lost all data sources for redundant verification unless your assessor breaks down every space individually. Additionally you may have to reform your MLS data mapping and will always have to manually verify everything since agents often lump the garden and agla together and don’t always fill out those individual lines, as they merely auto import from assessors whom also often do not distinguish garden from agla space. Because; garden levels are not basements.
Be sure to write your objection to FNMA directly here:
https://singlefamily.fanniemae.com/appraiser-contact-us-form
For such supposed pro’s, some people here have a real difficult time respecting and recognizing the importance of local jurisdictions, municipal guidelines, and MLS member services standards of operations and professional expectations. They can not seem to get their mind around that concept that in many locations, there is already a universal standard, and that standard is NOT ANSI.
You don’t win games by running the wrong direction on the field.
IN THEORY….This is very similar to what has happened in the Market the past 2 years. When the inventory dropped, and interest rates were historically low. We saw contract prices hit the highest level ever in history. Does this mean that the market had climbed in percentages never before seen or was it an unsupported market?
First we have to look at the definition of market value . it states
Definition of Market Value
Market value is the most probable price that a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently, knowledgeably and assuming…. the price is not affected by undue stimulus….. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: buyer and seller are typically motivated; both parties are well informed or well advised, and each acting in what he or she considers his/her own best interest;
a reasonable time is allowed for exposure in the open market;
Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and the price represents the normal consideration for the property sold unaffected by special or creative financing or sales concession.
So we see that the PRICE can not be effected by undue stimulus .. The lowest rates in HISTORY and even more important specifically SUPPLY AND DEMAND ARE the very definition of undue stimulus which was in effect in 2020 and 2021.
The entire Real Estate Market in the past 2 to 2 and 1/2 years does not meet the definition of fair market value, The definition also requires buyer and seller to act in their own best interest. Paying OVER appraised or “market” value is not acting in any buyer’s best interest IMO. Neither is waiving ALL inspections or appraisal contingency clauses. A Seller set a price with reasonable information and comparable from the area. The list price is what the seller will be happy to sell for and what the seller believes the property is really worth (possibly a bit less). So if a buyer pays over or even well over this “seller’s fair price” then the buyer is NOT acting in their own best interest but out of desperation, fear or just plain lack of information on area values. Lets not leave or reasonable exposure on the open market!! in 2020 and 2021 contracts were written and accepted in hours on the market… NOT the normal 30 to 90 days or more seen before this. That is not reasonable exposure according to the definition.
Now for at least the first half of 2020 contracts were written OVER market value and over appraisal value. The historic values just were not that high for sold properties in the 12 months prior to that time…. the sales could not be supported with COMPS. So Buyers had to bring cash to complete the sales. UNFORTUNATLY that part of the sale was not made public record. Public records only showed concessions and NOT the cash required OVER the appraised price. This was a very serious error IMO as it gave FALSE values on sales by never disclosing the shortfall on the appraisal to contract close price. Slowly more sales in each neighborhood were closed at these over market value prices. This made it seem like the prices were supported by previous sales in each area. Which we KNOW they were NOT! PEOPLE JUST OVER PAID. Remember we all know appraisers cannot use sales that are so much higher in value than the ones previous sold within the 12 months prior… in the same area.
At the end of 2020 there were enough of these inflated sales to show up as comparable sales and to support the historically high prices for future sales in 2021…even though the public records did not reflect the full information in an accurate way.
If we as appraisers adhered to the definition of fair market value then we knew that these were NOT fair market sales. We have to use established fair market values for comparable. We must follow the requirements.
Well the same thing goes for adjustments. NOT JUST IMO…We can’t just PFA. We have to be able to support and defend out report, our adjustments and our findings with data in our work files showing the support for all of it.
FNMA makes this clear in their 2020 release of CU. They state the” typical 20 per sq foot used by appraisers for GLA adjustments will no longer be accepted unless valid data supports that adjustment.” These reports will be FLAGGED!!
This is also well recognized in the Appraisal Standards and USPAP as well.
So now here we are. Until we can see data supporting that the public… the MARKET… does in fact value the garden level in split or multi levels, in NYC Garden style construction or LAKE resort homes in highly valued areas to be different we can not say it is true. Does the CURRENT market consider the new method of separating the GLA to valid? Do they consider the garden area to be worth less ? More ???I there DATA to the show MARKET reaction? We can not PFA adjustments to satisfy any one or any requirement. Some areas may HAVE factual Data to show a reaction. NOT ALL markets do. Until we see how and if the area Market accepts, expects and pays 2 different values for the levels and until builders charge differently for the garden levels and make that a clear selling point, IMO we can not say that the levels have a different market reaction . This has simply NOT been established yet with data from the market to show a different reaction to these levels. Just like we have to have sold properties in a newly developed area or to newly offered styles or plans to show market acceptance we now have to wait and see how the market will value these levels. Maybe they will value them the same as has been the case for as long as these styles have been offered or maybe they will value the garden levels less as is suggested by FNMA. Right now in this area there is No data and I will not use PFA adjustments.
Everyone is certainly free to do whatever their area recognizes and whatever they choose… I have no opinion on that.
Ba.. FNMA has not in any way suggested that garden levels are worth less. They just want those levels separated from above grade GLA.
It seems to be a very misunderstood concept for some reason.
The fact that they want these areas separated indicates that FNMA believes they have a value different than the rest of the structure’s finished areas. The fact that they do not want the area counted in GLA also suggests a different value is likely according to their way of thinking. As appraisers we do know that for years (all of my career) areas not considered in GLA were found to have a lower value in the largest percentage of structures. Below ground level basements, garages, 3 season rooms and other areas no counted in GLA…. ALL always required to be put in their own areas in the grid.
I agree it IS confusing. WE see this clearly with all of the comments. HOW will the MARKET SEE it? That is the real question here. In some area the market will NOT AGREE WITH FNMA. Thats just fact. whether there will be a reaction that is measurable +/- in value terms remains to be seen .
Right now the market sees an area which is below ground on all 3 sides with one side a walk out as “area that should be counted in the GLA” We know this is not accurate in most properties yet at times and in some markets we see it is. The Market tells us this.
How do you think the MARKET will respond to this new requirement? They already have shown they do not respond the way some officials in lending OR even in APPRAISING feel they should in many other things as well. This isn’t about you or I or FNMA or ANSI. THIS is about the MARKET and being able to collect the DATA to show WHAT they VALUE and how they respond in a monetary way. Right now you know we can not say either way because we don’t have the DATA yet. So when we grid it on a separate line and label it FINISHED NON GLA we are ALREADY making a decision that may not be market supported! WE are deciding it is FINISHED NON GLA…we don’t know if that is how the market values/responds to it yet. We do know they have never seen it that way before. NOT IN MANY AREAS including mine. NOW do we put a 0 in for an adjustment or a number? Where are you getting that number from? NOT data because right now there is none either way. That is what many of the solid, knowledgeable, experienced, VETERAN, professionals see.
Now remember FNMA has put in place many guidelines and requirements that have proven to be either ineffective, not applicable as intended by them or simply obsolete.
In 2016 the GLA adjustment was researched across the US by a group consisting of State officials, lenders, builders and more. IT was found that no matter where the location or what price the home that over 90% of appraisers adjusted 20.00 per SQ ft!! That was addressed by FNMA in 2020 as I already stated. That became the number one reasons for disciplinary actions on appraisers UNSUPORTED ADJUSTMENTS. Next FNMA removed the net and gross, because they found that 95 % of appraisers were staying below the percentage and NOT giving proper adjustments because of the net and gross requirements! FNMA ALSO removed the 6 month sales requirement because appraisers were using comparable less similar to the subject to stay with in the 6 month requirement. So please just understand FNMA does not know how the requirements they implement will be applied, utilized and or even if they are a correct way to accomplish a better more accurate appraisal. SO far that has not been the case or all of these things would still be required.
Exterior measurement on ground level and interior measurements on upper levels and below ground does not equal consistency or accuracy. IMO
How can 2 different methods for the same property equal consistent results? This is especially true with different people measuring the same property or so it’s been stated here.
I did not pick up the information or direction on an adjustment for the interior on the second floors and below ground areas that require the appraiser to use interior measurements versa the exterior measurements at the ground level. A formula? A standard fixed adjustment on the GLA for the interior versa the exterior?
What about different materials say plaster and lath board versa dry wall? Any consideration on that?
All just questions that have been brought up before.
Ba…. 5 weeks ago I appraised the converted church, very old one, the first floor had about 5 ft, out of 40 feet, 5 foot length, the front, was 2 feet below grade, I did not count that entire area’s basement, why because it doesn’t function as a basement to the market, it have also would have made the property a one bedroom with one bath because that’s all they had on the second floor, there was two bedrooms a bath and a family room on the first level.
So I wrote the report that the property did not have a basement and obviously I did not have other similar comparables, so I found one that did not have a basement, and I used to with basements.
But if I wanted to I could have called it a basement, because I am the appraiser, and I could have valued it the same as above grade, nobody is telling you how to value the area.
If I had a follow the new standard I would have put the code in, the report would be flagged and any reader of the report would look at the pictures and say we understand what the appraiser did and we either agree with them or disagree.
No one is telling you what price per square foot to use, obviously if you measure and add it of course you would be using interior measurements, I don’t understand the point you’re trying to make,
15 years ago when they came out with above grade and below grade on the appraisal report, we sat in class and the instructor informed us of this change.
You boys seem to be 15 years behind the times, would you keep losing your mind about is what I’ve been doing for a living for more than 15 years every day when I write up a split level, a bi-level, or a split entry whatever you want to call it or a tri-level.
No one tells me how to value these levels, only about how to report them.
No one in all my years has ever questioned my adjustments, no one has ever asked me to prove my adjustments,
.
If you have different qualities of construction, you make your adjustments accordingly, and just let the reader of the report know how you walk the path to arrive at a market value for the property.
All these underwriters look for is for exclamations So we conforms to investor requirements and that the big pools of money get bought by the investors and not returned needing to find a new investor to buy the pool of loans.
Like I said before 100 times now, once you start to separate these areas you will start to see value differences.
You seem to be hung up on what the market wants to tell us, that’s not the way the things work, lawyers are not told by their clients how to write up their legal briefs, doctors are not told by The market how to do doctoring.
The markets don’t dictate how accountants do their accounting.
And the markets don’t tell us appraisers how to do our appraising.
But we all have to conform to standards.
From all you are/have been saying I am getting the impression you may work more in the commercial world. (JMO) Most of what you comment on or how you address concerns fits nicely in the commercial world not so much in Residential. ANSI was well established in Commercial use for many, many years so your statement of “30 years or more of using ANSI” fits since it was accepted for that application well before the 1996 Resi use. Statements of using ANSI for OVER 30 years and “those who taught you were using it well before that” may apply to the Commercial market. Fees of 2000 K and 4000 K and 70K of income in a few months are possible in commercial in my experience. Many references you have made may apply to the Commercial industry. But that is NOT what we are talking about here. Your example here which is a conversion is not what anyone is STUCK on or questioning IMO. (Perhaps you do not understand this)
In the example you are using a commercial conversion or a unique property. These do not apply to the concerns, questions or even the application here. These conversions are exceptions that can be treated differently if supported. We ALL know this already.
Just for the sake of clarity on ANSI and your comments. The ANSI method requires the room count to be split above and below ground. So if (as an example) there is only 1 bedroom and no kitchen or living room that can be included in the GLA… you simply find a comparable with the same layout and adjust per MARKET REACTION to the room count above and below in separate lines calling them either non GLA or finished non GLA or simply GLA no matter how it all shakes out in design and style or market acceptance.
THIS is what some of the comments were questioning and addressing as concerns that you just bounced over. Now you indicate you did not adhere to the ANSI method for this assignment seemingly because of the room locations and counts required in using the ANSI method. (or so it seems) as you state ….
“it have also would have made the property a one bedroom with one bath because that’s all they had on the second floor, there was two bedrooms a bath and a family room on the first level.”
According to FNMA, You, as an individual cannot make a determination on “what to call IT” or how to address it ANYMORE NOW. In Appraising 101 the market data determined or at least shows strong indication on what the area is or is not considered and how it is or is not accepted and or valued.
IN the new requirement, ANSI determines all of this, according to what is shown in the course material.
What about the whole reason FNMA is now requiring a standardized method? If all of us as Appraisers can make determinations on what “we think” then we are back to a lack of uniformity from one appraisal to the next. Something you say has been a problem with GLA since you started. Uniformity is uniformity. Do we consider it in one aspect and not another? IT either has a basement or it does not. What will the next Appraiser determine?
AGAIN… ANSI states you cannot pick and choose what you use in the method. You either use it ALL… EVERY STEP or you cannot claim ANSI compliance.
Your example shows ( or seems to strongly show) that just like the rest of us used your own judgement on how and when to measure areas “correctly” or by the Standard. You indicate in your own practice there was and is NOT an absolute.
This is what we all want. The ability to abide by what the market considers and what the area recognizes in valuation. Just as you did in your example of the conversion for the basement and room count.
FNMA now REQUIRES ANSI compliance. Although FNMA allows the exception for rare circumstances and A- typical construction or A- typical areas for SOME extreme construction like earth homes …it is up to FNMA what they decide to allow at this point. A reviewer, an underwriter or even an AMC QC may not agree with your reporting method. Do you say, ” I decided to report it as it had no basement and no value?”
Then in the cost approach do you show the area with no cost for replacement? A FREEBIE AREA? Just wondering…
IF you use the ANSI method as required, you cannot just decide to use the exception at will. FNAM has to approve your explanation. FNMA states the exception cannot be used on a regular basis and appraisers will be monitored on how and when they use the exception.
15 years ago? Far longer than 15 years ago in my world, friend. But FNMA also accepted a “usual and customary” comment based on Market reaction for how the areas were addressed and adjusted in reports. Not anymore. Not in bi levels and splits and some other construction types according to this.
ALL adjustments in Appraising ARE made based on MARKET REACTION and supporting DATA. Certainly you are not debating that are you?
Doctors, lawyers, accounts and all else you mentioned do not have to research the market to find out ” what the market accepts, desires and responds to in a monetary value ” about anything of these fields. These professionals are not required to make ADJUSTMENTS based on their client’s reactions (market reactions) in reports that are sent to other professionals in different fields to rely on. You cannot compare services to products in this use. You do understand that these things you mentioned are services not GOODS/products right?
There are however occupations associated with these fields that do research the market for reaction, opinion and therefore the success/and policies of these fields and their implementation, use or modification . There are professionals who advise on jury selection for outcome. There is Voir Dire to determine selection of juries for both sides. In Med school there are required courses addressing the business side of Medical practice and public relations!! There are surveys given out in most businesses and there are suggestion boxes all OVER the place. So to say the professions you note do not consider the MARKET is simply incorrect.
The trades you noted are not working with production, manufactured or constructed consumer products or goods. I am sure you have heard of Neilson ratings AND consumer surveys? I am positive you have heard the term “Market acceptance?” ALL of these things are developed and utilized to consider public reaction to professions and goods of all kinds. Even Television shows. YOU KNOW those with poor ratings get cancelled. That’s just the way it is. There are so many more examples of the public’s effects on how things are done, made, changed, viewed, MARKETED, SOLD and even CANCELED. I am sure you are more than aware of this too.
These and much more are all tools to measure public reaction, public perception, public acceptance and public opinions! SO the MARKET/consumers are considered a very important part of life. So why disagree with something you know to be true?
This is appraisal 101 and is VERY IMPORTANT in the process of developing an Appraisal report and in the entire Appraisal career after the test. NOT JUST IMO. Thats what many of us have been saying. I am not sure why THIS has been so complicated for YOU.
ANSI recognizes a different standard for residential within commercial. The recognize the ground level concept, not the below grade concept.
The ANSI work group which effects hundreds and hundreds of thousands of appraisers realtors mb’s and reviewers around this country was what size? Hint: It appears to be less than 20 people from the East coast and they ignored almost every single licensed appraisers written suggestions. That’s well researched methodology you can trust! Also, every assessor, building code inspector, blue print creator, and professional builder in this country whom does not adhere to ANSI and immediately retroactively change all their recorded data, they’re clearly incompetent, just like appraisers whom do not want to use ANSI.
“If you’re not with us, you’re against us.”
Consider yourself lucky …for 15 years you have had it easy compared to the rest of us.
BA….I don’t do commercial….I work for VA……New fees….$625 X 7 (a week) X 4 weeks x 4 months = $70,000. doesn’t even include that extra week every few months…Or re-inspections for repairs.
Commercial uses Gross Building Ares
Residential Appraisers us Gross LIVING Area
You are still confusing value with reporting……ONE last time…..No one is telling you how to value……You are being instructed how to report….Something IMO most of us have been doing for more then 15 years when they came out with ABOVE and BELOW grade REPORTING 15 YEARS AGO !!!! lol.
Consider yourself lucky …for 15 years you have had it easy compared to the rest of us.
You were even told…if the property NEEDS to be measure differently then ANSI…Just tell them. That is for unique properties like my converted Church.
You will get use to it, its not a big deal….come back in a few months and let us all know if you see value differences…and ya..if you mix and match designs like colonials to splits, your net, gross and individual (if you are making design adjustments) will be through the roof, obviously…but that is why they got rid of the 10%, 15% and 25% rules….
The appraisal GODS are not stupid like you think….
FYI, these homes are more than 15 years old.
We have not had it easy. We have had additional data verification sources.
If sketching has been difficult for you, you did that to yourself by adopting a standard nobody else in your industry has adopted. Like trying to speak a foreign language in a room where nobody else speaks that language. You can toot your own horn about this all day but nobody will ever extend you any additional confidence or prestige on this matter. Because; garden levels are not basements no matter how vainly you try to convince people or how many times you repeat the ANSI slogans.
Now FNMA is a god again… Telling. Let me set you straight. FNMA is a GSE business institution with a charter. The appraiser stands alone as the only licensed non advocate in the entire lending process. And no, we’ll never get used to fictitious reporting and improper labeling. Because that’s fraud.
Are you really equating measuring with actual measurements to a foreign language? Its VERY simple, whatever the tape or laser reads, you use. If thats completely foreign then i cant imagine what the actual report looks like. All appraisal classes in all states teach the same thing. I have had many instructors from all over the country ALL have taught, when it was part of the seminar, class or discussion, that below grade, even part below grade, are considered basements. That fact should not even matter if the comparables are the same style.
Really….. then why have a separate NEW grid line for reporting them? WE already have a below grade line and a finished sq ft area and a below grade room count area line. If below grade is always basement, then FNMA does not need to make new requirements in the GRID now do they? NO finished non GLA stuff and all the other BS either. NOW we agree…oh wait here it comes…. no you don’t right?
Oh right.. there are 4 level splits with what…. 2 basements then? Oh no its ok cause that’s right you said earlier just don’t call it a basement count the sq footage and the rooms as if it is not a basement then use comps with basements and figure out the adjustments from the old theories and now outdated reactions due to the new requirements now 04/01.
Cause we are the APPRAISERs and we can do what EVER we want.
Let the NEXT guy call it what ever he wants then too! Hopefully he will not do anything different…Just saying
And in a perfect world all the comps for miles are the same, same age, same style, same GLA, same developer all sold within a year. That is simply NOT the case HERE and many other areas. WE don’t ALL have that luxury….And remember HERE very few report the BELOW GROUND LEVEL…. “REAL basement areas” as known by all in my area…. so there’s no way to tell if its 3 or 4 levels. AHH….dang it another unknown issue to deal with.
***This comment was edited by AppraisersBlogs Team for compliance with TOU and our commenting guidelines.***
So unfortunate that you cannot allow free and independent thought without insulting those who disagree with you.
I really don’t think we are in the same league here and I am really NOT trying to offend you. I simply see much more to appraising accurately than you do evidently. I have been speaking of things that you do not feel the need to consider or address or concern yourself with. The things I and others have addressed had nothing to do with the subject you keep reverting back to which is ANSI.
For example, I have not mentioned or addressed GBA recently but somehow you decided that I did not know the difference. If you had read earlier you would know I spoke to that way back weeks ago and I did so “Correctly:. OOOPS see what you missed!
I suggest once again you consider reading what others comment on here. Just a suggestion.
I think you may be surprised how many appraisers may just be as good, as educated, as experienced and as successful as you feel you are. Some are even better. AS I stated earlier you really do not know anyone here and their RESUME.
You seem to think others should just agree with you and take unsolicited direction you insist on giving. But the only thing you address discuss and advocate for is measuring. That train left the station weeks ago friend. You are just NOT reading!! You wonder why anyone disagrees with you…its because the discussion has moved past the ANSI method. ITs not there anymore and hasn’t been for a long time now. Sorry but no one here knows anything about you, your abilities, your success or failures. All anyone hears is what you so proudly claim while being condescending to others.
I choose to address concerns that have been brought up here and on many other forums as well. Everyone has a right to question, to disagree and to have free thought and to discuss without being belittled. IMO
ITs not that we do not understand or that we cannot apply what FNMA or other entities throw at us. Its not that we don’t measure right or see right or write right as you seem to think here. We simply see that we are not only permitted to question and to disagree… we are compelled to question AND to disagree if we find or believe flawed thinking is involved. When these board room wizards decide “well today we are going to do this and we will no longer being DOING THAT…it calls into question why we were required to do things that we all knew were flawed long before those wizards did!! FNAM was complaining that appraisers were meeting the net and gross percentages simply to comply so NOW they no longer require the net and gross. Suddenly they realized that at times good comps may require higher adjustments and THEIR requirements were not promoting ACCURAACY. FOR years they thought differently and we all had to explain out of range adjustments!! This is just simple… we are professional, educated, competent and NOT MINDLESS followers and guess what….. we do not have to conform to things just because some entity makes up some new reporting requirement to advance their own interests. Requirements that do not comply with OUR industry NEED TO BE QUESTIONED. It’s simple in the previous post on the conversion… WE are the Appraisers and as was pointed out…. Appraisers can do anything they want cause THEY ARE the Appraisers…(even though I don’t agree ….it sure makes your points invalid IMO) WE can exercise the option to question flawed requirements and question the ways these requirements are implemented and how they effect OUR INDUSTRY and when and IF they will be seen as needing change or modification. WE ARE THE APPRAISERS and we do know how to do our jobs. FNMA evidently still has a problem understanding that. That should not bother you at all IMO….sorry if it does.
I understand you evidently do not need market supported data to extract adjustments. How you achieve them or how you determine none are needed is still yet to be explained. (a 0 is still a decision.)
There appears to be a problem when anyone gets too technical for you as you simply just go back to how “they will get used to ANSI.”
You do not appear to want to address issues others have but that’s ok too. What we all know is ANSI was not the issue any way (I know you thought that is what anyone/everyone was complaining about. WE tried to tell you.. but you must not have been reading) it was the GRID and the FNMA direction / reporting that MOST people were objecting to.
REALLY though if you are only doing VA no worries you don’t have to concern yourself with FNMA and how they require the new grid lines with the GLA, NON GLA, FINISHED NON GLA and UNFINSHED NON GLA, No worries for you on obtaining the adjustments or LACK there of.
DATA that we don’t have yet is not anything for you to worry about.
I think I recall VA has passed on ANSI as a requirement! You are so lucky there.
Good for you…7 per week with a much slower market. You must have been doing 14 per week at peak. Now you can take a breath! Since rates almost doubled I am back to normal pace.
You have big plans that the market will remain hot for VA even with raise in rates… again GOOD for you! Real Estate is already way down from last year and statically the number is 63% less than 6 months ago according to the statisticians. But if VA is still going strong no worries.
I wished I could have retired young like you. But VA pays way better than FNMA does that’s for sure.
“the first floor had about 5 ft, out of 40 feet, 5-foot length, the front, was 2 feet below grade, I did not count that entire area’s basement” So this tells you how slow things are now, I’ve spent most of my Sunday reading this dated post but I got the impression that you measured to ANSI standards? Your admission to not include the below-grade areas as a basement indicates otherwise!
Baggins…I never said garden levels were the same value as basements.
You have had it easy, not for the age of your houses, but for not having to REPORT Like the rest of us for 15 years when we were told the NEW definition of was considered to be BELOW grade. I remember the class.
Don’t you ??? Or did you ignore that?
They are GODS..they just changed your reality, just like all the other form changes we have been through the last 30 years. All the extra work we were forced to do, listing history, MC forms, past sales history, how many active and sales.
When my original office had 25 appraisers and 25 assistants…don’t you think there would be a huge problem if one of their appraisers measured 1 way and said the house was 2000 sqft and years later when the SAME lender ordered another appraisal that another appraiser would NOT be close in GLA..
We were doing 500-700 appraisals a week at the high of 1992-1994. A week !!! LOL We were using ANSI 30 years ago and yes they had a major commercial division. And a flood map division….Talk about rolling in the money.
Again. You should have been following your local municipal guidelines. How hard of a concept is that? It provides the basis for uniformity. In having one singular standard, you may have then in turn applied a variance to reporting which nobody else recognized. You don’t help the team out by running the wrong direction on the field. And the team is not just the appraisers in an office, no matter how big the office is. The team is the entire realty appraisal MLS and assessor community, and we’re all supposed to be on the same page with a comprehensive data standard. That standard specifically is the municipal building code guidelines applicable in that jurisdiction. Your view of this matter is provincial, too lazy or stubborn to become competent with your own market standards at hand.
Baggins…….”You should have been following your local municipal guidelines” Why? Who told you that?
” It provides the basis for uniformity.” so does ANSI…..which is why the appraisal GODS have spoken.
“In having one singular standard, you may have then in turn applied a variance to reporting which nobody else recognized.”” Who is nobody else ??? We never had a problem.
“The team is the entire realty appraisal MLS and assessor community,” Team ??? Seriously….Team? LOL
“and we’re all supposed to be on the same page with a comprehensive data standard” Now we are with ANSI –ya..go ANSI !!! We appraisers are now a team….YA right……We couldn’t even organize to stop the management company take over of an entire profession.
“That standard specifically is the municipal building code guidelines applicable in that jurisdiction.” Assessors and realtors tell us appraisers what to do……Ya right…..LOL Who told you that?
“Your view of this matter is provincial, too lazy or stubborn to become competent with your own market standards at hand.” Well this incompetent appraiser just wrote his last report yesterday at the age of 56 and headed to retirement…..lazy, stubborn ???
NA…..Considered 1 of the best for 30 years…and was paid mightily for my skill and expertise…..
I was the guy they called…..they used to say…”We need you on this one. Name your price, take your time, send us an invoice and we will overnight you a check” I had their check before I even called anyone….
I was paid $2,000 for court appearance up till 12 pm and $4,000 if it went 1 minute past 12PM. Never even had to sit in front of a judge…opposing council was terrified of me after they read my review of their appraisers report. I would have chewed them up in front of the judge and they knew it. They used to try to stare me down…I just looked at them and smiled…Come on baby…lets have some fun. But they never wanted to play, went outside in the hallway and settled with my clients. My clients loved me..they didnt even have to go into the court room……LOL Oh those were the days !!!
Those days were fun…but I hated waking up early and having to put the monkey suit on….Loved the lawyers…learned a lot form them….The judges were even cooler.
I was asked to handle license revoking cases…told them $500/hr including drive time to the state capital…they didn’t even blink an eye…..
Last question…why do you add right wing non sense to your posts….? Oh..never mind….I know.
2000 mules was a joke……the grift continues for our low IQ Americans. Did tRump really play that down in Florida for his sheep followers……Yes he did……LOL
I thought we were done with this ANSI thing….nut thanks for the distraction…..Back to putting up my crown molding….Time to sell at the high of the market and get out of this country before its too late.
Thailand here I come !!!
Bragging. Finances dropping. Career stats dropping. Countering political documentary with political rhetoric. Restating positions from previously well rebutted arguments as conclusive fact, ignoring everything which does not fit into your argument goals. A note of walking away to your idea of paradise which will somehow create a note of inferred jealousy being inevitably inherent, looks like I lost again. Genius. You should get paid by ANSI, you’re that good of an advocate.
Called the local county Assessor and asked if she measured by ANSI standards. She said she had never heard of it.
A workable ANSI work around. Does not change net/gross. Does not change room counts. Does not alter the metrics of matching units of measurement based market reaction adjustments. Can be understood by both ANSI zealots and the people whom understand and adhere to local municipal guidelines. Problem solved.
https://appraisersblogs.com/solving-the-ansi-measuring-dilemma-a-simple-work-around#comment-34587
So… Are you an assessor or an appraiser?