ANSI & Floor Plans Goofiness
There’s been lots of discussion on various forums, classes, Facebook, blogs, podcasts, surveys, articles, etc., about the upcoming ‘demands’ by ONE of the GSE’s to measure using ANSI Standard Z765-2021, and by both GSE’s to provide a for certain assignments. Uniformity is the stated goal.
ANSI is not consistent in how they want the perimeter of homes to be measured. Here’s why: for new construction, when the plans (blueprints) are provided to the appraiser to report ‘GLA’ etc., those dimensions on the plan are measured from the EDGE OF THE FOUNDATION as shown on the plans, not the sheathing or siding on the home. (3.1) This is the same dimension locations the local assessor uses when they input new construction homes into their taxing data base from submitted plans – because in most cases they do not physically measure new construction homes in the field – they use plans submitted for the permitting process. Cantilevers extending past the foundation or lower floor are measured to the exterior stud face for the wall, not including sheathing or siding.
But when the appraiser physically measures an existing home on-site, the ANSI Standard says to measure “at Floor Level to the exterior finished surface of the outside walls.” (3.2 & 3.3) Does the ‘exterior finished surface’ include brick or stone veneer that extends beyond the actual framed finished wall surface?? Does the ‘exterior finished surface’ include the corner trim that most homes have?? ANSI doesn’t address these items directly.
When one really stops to analyze what ANSI is saying, realization is that measuring to the ‘finished exterior wall’ actually can or may have the result of ADDING square footage to the dwelling! When you also know that the ANSI Measurement Standard initially came from requests from the home building industry beginning in 1994 to establish a Standard, you can see why they might want that to be the result!
ANSI does not use the term “GLA” which is on all our forms. ANSI uses ‘Finished Area’ to reference both above and below grade areas suitable as year-round living space, and ‘Unfinished Area’ for the space not meeting the criteria of Finished Area. However, for reporting purposes, Fannie Mae expects the GLA figure to mean above grade Finished Area, and basement to mean Finished and Unfinished Area below grade.
For those who may not know, most homes in the US are designed using common lumber dimensions (measured to the INCH) to avoid as much wood waste as possible. Plywood or particle/OSB board used for exterior sheathing is in 4 FOOT dimensions (48 inches) in most cases, sometimes 5 feet wide, and by either 8 or 9 FEET long. Pre-cut 2×4 or 2×6 INCH studs used for wall framing are cut to a specific length to accommodate the top and bottom plates and wall sheathing without having to make wastage cuts in the sheathing. Interior Drywall is made in 4 FOOT dimensions, by 8 or 9 feet long, again to fit the normal ceiling heights without having to cut and waste very much material.
Most homes in the US are designed using what’s called “English Measurement”, usually meaning 12 inches to the foot, or in some cases, 10 segments to the foot. Most new home plans I’ve seen in my 21 years appraising are using FEET & INCHES, not tenths of a foot. Most US building carpenters use measuring tapes with INCHES on them! (I designed the home I live in using FEET & INCHES, not decimals!)
To repeat: ANSI says to measure the “exterior finished wall” to the ‘nearest Inch.’ At floor level. Final square footage is rounded to nearest whole square foot.
Well, since we are supposed to bend over and measure from that floor location, and not chest height as most of us do, why shouldn’t we actually measure from the face and corner of the Foundation (just below the floor level), as home plans are dimensioned? Doing that will give us consistent measurements with the local assessor, assuming of course that they use the dimensions on the plans given to them. It will also make the appraiser’s measurement very consistent with comp ‘model match’ dimensions when those exist!
Concrete block, brick wall, straw bale, rammed earth, log and other such homes are measured from the outside surface of the material, but I would argue that observing the actual foundation location is prudent to know where the actual exterior wall structure is positioned.
The ONE GSE has selected April Fool’s Day as the effective date for this new measuring standard. It has done so in an attempt to force everyone who provides home building dimensions and ‘finished and unfinished area’ square footage to “get on the same consistent page.” How can that be, when ANSI itself is inconsistent??
Turning now to Floor Plans. That wording was subtly incorporated into the former ‘flexible’ reports we were able to do during the COVID era as a required exhibit, but was NEVER ENFORCED. Then that wording was subtly incorporated into the ‘new’ form report “flavors”, the 1004Desktop and 1004Hybrid. The rationale for doing so is “well, if you the appraiser are not required to inspect the property yourself, don’t you want to have a more detailed diagram of the home, i.e., a Floor Plan?”
On the surface, it sorta makes sense. Dig deeper, though – does it really help consistency?
When an appraiser does a full inspection for a traditional SFR report (and the report goes to ONE GSE, at the moment), the appraiser needs to provide a ‘Sketch’ with exterior dimensions only (unless internal design problems are found), and MUST do the measuring per ANSI.
But, when the moonlighting pizza delivery or ride share driver “inspects” the house ** and gives a property condition report to the appraiser, then that person DOES NOT have to measure using ANSI, but must provide a Floor Plan. If the homeowner or maybe a real estate agent cooperates by holding their smart phone (only certain models) with a proper ‘app’ installed and walks around the property, the resulting Floor Plan does not have to be per ANSI standards.
Several AMCs are actively soliciting to hire ‘inspectors’ when a borrower or agent won’t cooperate on Desktop reports.
And of course, the data collected and presented to the Desktop appraiser must be “verified” from a dis-interested source, if the appraiser is to proceed with the assignment.
** Don’t get me started on the semantics of whether or not this is actually an inspection!
To summarize: So, if an appraiser does a FULL traditional inspection (for Fannie Mae), measuring must be done per ANSI, but no FLOOR PLAN is required – only a Sketch (except as noted above). But if a DESKTOP (or Hybrid) report is done… then the FLOOR PLAN is required, but it does not need to be done per ANSI.
The whole reason why ANSI is being mandated (by Fannie Mae only at this time) is to try to get SFR measurement data done by appraisers uniform across the US. But if no appraiser is directly involved, then that’s out the window.
Raise your hand if you think either of these makes logical sense in making data uniform!