Functional utility… It’s a house, capable of sustaining human life. Water, heat, air, toilet, walls, roof, etc. It’s not a barn or a dome or a hobbit dwelling burm home on the side of a hill. And you can’t glean much from a sketch either. It’s only after families spend time in a home they realize perceived functional deficiency. Like why is this hallway so narrow and only supports one way traffic? And everything else in the same price class has those narrow hallways. Unless we’re dealing with exceptional mis matches and such, functional utility is almost always offsetting. Can you imagine the office guy at the desk, looking at all these sketches, trying to imagine functional existence of the residents, hoping to scrape out a stipulation request. These new FNMA standards are utterly pointless. They’re just colluding with the ANSI group to force appraisers to buy more books.

Don’t ever let someone confuse an appraiser with an architect or IT guy, totally different careers and scopes of work. The FNMA scope creep is just entirely too much, on top of what was too much to begin with. I’m going through old workfile boxes recycling paper. We used to just scan in forms and worms pages with pencil drawn sketches and that was just fine. Wake me when it’s over. GXX001.

Where did the 700+ ANSI complaint posts go? Must have been a different thread. Oh yes, that was a lot of fun.
https://appraisersblogs.com/ansi-measuring-standard-required-by-fannie-mae-in-2022

In Maryland the discrepancy is easy to explain, the Realtors are instructed to use the assessors guesstimate.
Assessors calculation:

The first year a residence is constructed, back to 1940s, the assessor measures the first floor. Then they multiply by 1; 1.5; 2; 2.5; 2; 2.5 etc for the number of floors.

Separately, they add cost for dormers, a set fee for each dormer is added from a cost book, a higher cost for shed dormers, the dormers are not measured, and not included in the living area square footage.

If a property owner adds an addition, 50% of the time it is not added to the square footage. It is tax free space. But in some cases, the assessor will decide, without inspection, that a faux window is a finished floor, see 1; 1.5 etc. The assessor does not come into the house to measure.

Finally, in around 2000, the assessors were told to add for all other heated space on the property. With no guideline for how to measure that space, they include it as the primary residence living area.

We had one property with a primary residence, 5,245 sf living area, and 10 cottages between 550 and 1200 sf each. With the last transfer, the Realtor’s listing had primary residence as 12,650 sf. No mention of the cottages. The Realtor used the assessor’s figure for finished space. The fun part was finding Appraisers referring to the sale as having a 12,650 sf house, and trying to adjust for the size or using it to value other large houses.

No matter how you measure a house, if you have not measured the comparables yourself, you are guessing. How about we use “S-1” tiny, small, medium, large, very large, and “S-6” huge, for comparison sake? Just like Q1-Q6. It would simplify the appraisal process, and make it easier for transformation of the appraisal process.

Then we can have fun arguing about How big is Huge?

Except you are privy to that information. Building and design standards are part of the local jurisdiction’s public management package. Anyone and everyone whom hopes to construct or alter property in that area must know the zoning and coding regulations. Building size and space recognition and standards is in their code books, publicly available for all to see. Appraisers absolutely should be aware of how such discrepancy in county data occurs, otherwise we could accidentally mis match our comparative basis and apply unwarranted adjustments. Until the entire industry top to bottom adopts a uniform standard, it is the appraisers duty and ethical requirement to know or provide informed speculation how others came about their figures. If all that results in is they don’t know what they’re doing and are apparently incompetent, so be it, but you have to research the point anyways. Counting stairs or not, being probably the most obvious example. All this authoritarianism lately, you must do this and can’t opt out of anything, these are not professional approaches and we still request a voluntary opt out from FNMA on the matter of ANSI. Specifically because none of our local jurisdictions have adopted an ANSI method, or anything even remotely close to it.

“But in response to an AMC whom asks me”. I have identified your primary problem. Getting them off your back is of no consequence and is not an indicator of effective liability management.

I’m going meme nuts lately. It’s fun though. Here is a unique creation, overlaid on an ANSI safety sign… At some point groups like this ANSI body need to slow down. Want to standardize the whole world. Tired of getting pushed around by people whom don’t have appraiser licenses themselves.

Fitz, you really nailed the issue. I was saying, if such major institutions like GSE’s want to get more consistency in measurement, they should be pleading and advocating with their government connections to push something like ANSI down the line for assessors, somehow through taxation, builder standards, codes, some regulation other than appraisers. I mean, they’re just short cutting to the people they have some form of jurisdiction over, the largely unrepresented appraiser. No opt outs!!! A harsh tone. Do it this way or else.

But none of the assessors around here comply with ANSI, we have a million or more tri and bi levels, all of which have that partially below earth ‘garden level’ area. And like a magic trick, appraisers are supposed to cut that out. It’s so problematic, because that cut out formerly agla now basement non basement area should still adjust same as agla, while occasionally we’ll need to cross compare against something with an actual basement with a lower adjustment basis. If ANSI is going to be demanded by FNMA, my suggestion is the new forms need three different gla adjustment lines. ANSI qualifiable above grade, basement, and a third special line for situations where ANSI requires we cut out ‘market recognized agla’, which still needs adjusted at the normal agla basis. It’s going to steal a line item on my current 1004 form and I’m not sure the updated form is capable of even writing in a special line like we do now.

Why can’t they just leave well enough alone? If you read through the ANSI working group for measurement standards material (linked in one of these blog rolls as we’ve had several lately), the ANSI group straight up ignores all the licensed appraisers suggestions and does it their way instead. They like ignored 14 out of 16 appraiser consultant objections and suggestions, denied, denied, denied. Like some frigging kings of industry, or board leaders, the ‘ANSI working group’ is driving the actions of tens of thousands of appraisers, effecting hundreds of thousands of realty agents and all the others down the line. Even NAR wrote a letter someone posted on this blog, asking FNMA to walk this back immediately.

And now they’re going to make a fortune selling silly digital ebooks. I agree, someone has to be getting paid handsomely for this and truly if this is going to be the standard, FNMA should likewise demand ANSI release the book for free to public and stop charging for it, if not incorporate it into the selling guide. By incorporating it into the selling guide this would in a certain way prohibit or at least slow down the inevitable repeat update of the ANSI book. It’s going to be cosmic cobra on steroids far worse than the new uspap book every two years. This private company is going to make a lot of money selling everyone from apprasiers to reviewers to just a great many people this book. We won’t be allowed to legally share it I’m assuming that’s true. And nobody else will be able to understand how appraisers are doing things unless they buy this damned book. Since when did we have to pay for a book to understand a shoe size (another standardized deal ANSI completed), or to know the size of standard tools, or know electrical measurements, etc. Of course it takes skill but if there is to be standardization, the point of that is for the betterment of an entire industry and should not be used as a cash grab held behind a paywall. The other ANSI thread caught on fire has like 350 posts.

A few pro senior appraisers were really helpful and they make this work. But they don’t necessarily deal with the same ‘market recognized’ sizing situations in other states. The ANSI allowance list for using GXX001 is clearly written by some coastal person, talking about burm homes and cape cods. Never seen that home type in my entire life. We have Bis and Tri’s that always have below ground garden level, unusual mountain A frames, builds into mountains and slopes, lot of walk outs. I wrote FNMA asking for an expanded list to be included in the allowable exception code lists. What a mess. We’ve all had enough government mandates to last a life time. These people do not understand the principals of volunteerism and think they can run the world and make everyone comply with dictatorial mandates from an ivory towers. This has got to be more disrespectful than hvcc and cutting us off from lenders. Or, well, it’s close.

Maybe all of the homes in your market area fit that. 100 sf difference can be a big deal for a 300 SF condo. In a 10,000 Sq.Ft. house the market might not notice a larger difference.

In 1986, The National Association of Real Estate Appraisers, was a wing of NAR, and to be a member you had to be a Realtor. Due to national legislation conflicts with NAR and Appraisers, the appraisal wing left NAR and formed The Appraisal Institute, shortly after that a dozen appraisal organization appeared on the scene, each representing its specific interests. Some times working together, often not. There is a side group, the State Appraisal Associations, now more than thirty that work together and have begun to be a force, they are less expensive to join, mostly voluntary, and need and welcome individual appraiser support. Even if you are part of one of the national associations, you should join your state association.

As to measurement, in 1986 NAR issued a statement to all REALTORS, do not measure houses: over and over Realtors are being sued for wrong measurements. The living room on the listing was 10 x 15, the buyer purchased a 10 x 15 carpet, and it was too small. NAR recommended that the Realtor use the assessor’s square footage. A month later I sent in appraisal reports with no square footage in the comparable section, with the explanation that neither the buyers, sellers or agents knew the square footage of the houses; subject or comparable, I was told to put in a number anyway, any number.

I do not know how Assessors do it everywhere, but in Maryland for detached houses they measure the first floor above ground level. They take that measurement and multiply it times the number of floors: 1; 1.5; 2; 2.5; 3 etc. They do not use 1.25 or 1.75. Then, on another line they add costs for dormers, but never add that space, including shed dormers. A saltbox is 1.5 time first floor. A cantilevered 2 or 3 foot over hang, is not added for the added space. These can be rule breakers, for the owner getting a lower tax. A cape cod whether roof is 4/12 or 12/12 with dormers, or none is measured as 0.5 times first floor. Realtors continue to use the assessor’s figures.

It is time we use descriptive words and forget the measurements, because so often size was not a factor: like 3 big bedrooms. or 10 little tiny bedrooms. One I inspected recently: The kitchen was so small they had an 18 inch wide dishwasher. The answer is that as we have to purchase the ANSI guideline, we need to add an additional charge for an ANIS measurement. The cost of the book would be a good price. I cannot believe that FNMA would require we use a private association formula and make us pay for it. Are they getting a kick back?

Think of it this way, you measure the outer surface of the house, the stairs are on both the floor of the lower level, and in the air up to the second level, therefore the stairs are on both floors. The open area floor of first floor to 2nd floor ceiling is not counted. Add the over hangs.

It is likely that your ANSI measured house is bigger than the assessor’s identical house next door. Your bank will think they have a bigger house with more value than the house next door. And if you say, you measured using ANSI you have a standard, and the other house is “unknown” you are not responsible for that error. Or you could say, the ANSI measurement is X, which is standard, and then put in the figure that the Realtors and Assessors use for your subject on the comps page, because that is what the market thinks your house is, and then sit back and watch the computer programs blow gaskets trying to make you fix it. What is correct, what the market thinks? Perhaps the problem can be solved, as the ANSI measured house has external obsolescence because the market outside the property does not think the house is as big as it is. Thoughts?

Kenneth, Freddie Mac selling guide. No mention of ANSI. Only Fannie Mae has announced the imposition of ANSI.

Hello Jim Where did you get your info that Freddie Mac does not require ANSI? Thank you

Penny auctions. There is nothing new under the sun and it’s all been done before. There is no such thing as a safe loan. Debt is dangerous. I’m going to kick it until the final minute of the final hour. Or maybe I won’t. Who knows and I’m not bothered by it.

Good CJK, good ideas. I talked to a realtor about this just in the past few days. He was telling me the issue of non appraisers inspecting has become so bad that he’s even using prohibitions in the showing time automatic showing services. One good suggestion he had for other agents was to take a for sale home off of the automatic showing services lists the very same day that a contract is accepted. That assures him that regardless of who wants into the home after that, they have to personally contact the agent. I really like your specific language though, great comment, be sure to post that again and again and again, it’s great language.

Tell you what, if I’m going to have a desk job I want retirement, benefits, vacation, sick days, the works. I’m not going to languish with only desk work as a 1099. All FNMA needs to do in order to increase appraisers potential to complete more work, is stop the amc’s from stealing half of the appraisers income. Amc’s bragged about record setting business growth while simultaneously shutting down appraisers potential nationwide, costing us tens of thousands of new hires, pilfering well over a billion dollars of our now lost income in the process. The desktop third party inspector has been tried before. It was a gimmick then and it’s a gimmick now, regardless of the flashy new branding they are applying. This is an inferior work product, now with inferior non regulated third party inspectors to boot. It’s laughable and the only desktop I will complete is one which does not require an inspection what so ever. Going to start offering inspection review services! One could make a complete business simply backtracking everything that will go wrong with third party inspection services.

That’s right Jim, it all starts and ends with the assessor. And the assessor does not always do things the way people think. If the building department is busy they may field measurement at any time during or after construction, they may confuse plans and builders can forget or purposefully not share change orders which buyers request during construction phases. Then there is also general incompetency sometimes and I’ve seen homes hundreds of sq ft more or less than what people thought they were supposed to be. I run across a sketching challenge and inconsistent data reporting vs what is really there, about once or twice a year and it’s always a big deal when that happens, sometimes altering the course of deals and costing people tens of thousands of dollars. I mean good work explaining it but why bother.

I’ve already started entering GXX001 into my reports. I’m not sure if my sketches are ANSI complaint, and I don’t care either. ANSI is a standards institute whom has their hands in a wide range of other topics and interests. That group has carved out proprietary relationships and special deals across the spectrum from suppliers to construction companies to special terms via FNMA loans. The ANSI group utilized dozens of appraiser consultants whom the far majority of those qualified appraiser consultants recommended against this across the board ANSI blanket standard. ANSI ignored all of their advisement and pushed forward with this anyways. That’s on their own website and we detailed the links to the pdf docs containing appraisers objections in a previous thread. ANSI is a power player helping other proprietary interests corner the market in an obviously biased power play. ANSI and their underhanded plays do not direct my actions. The ANSI groups have ignored their own consultants to their own detriment and in doing so flushed a substantial portion of their credibility down the toilet. Talking about going metric to the tenths, reporting contrary to long held traditional reporting standards, we’re not going for it.