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Above Grade / Below Grade

Discussion in 'Urgent - Help Needed' started by bbr711, Jun 23, 2009.

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  1. bbr711

    bbr711 Sophomore Member

    0
    Jun 30, 2008
    Professional Status:
    Certified Residential Appraiser
    State:
    Tennessee
    Appraising a home with 1,620-sf above grade and the same below grade, all finished in similar quality and style.

    Trouble is that the home is an owner-built custom which has the following above-grade rooms: kitchen, dining room, family room, 1/2-bath, and master suite. Below grade are 2 more bedrooms, full bath, a media room, an office, and a den.

    I'm curious as to how other appraisers handle the 1-bedroom above-grade situation when no comps are to be found with similar room count.

    Thanks!
     
  2. Don Clark

    Don Clark Elite Member

    9
    Jan 17, 2002
    Professional Status:
    Certified Residential Appraiser
    State:
    Virginia
    Find comparables as similar as possible with whatever number of bedrooms above grade, but with additional areas used for similar purposes below grade. Remember, just because some rooms are below grade does not mean that they are not as valuable as rooms aboive grade. It is Fannie Mae and others that decided that there is a difference in rooms above and below grade. The market, some markets, do not see it that way.

    But then, i am speaking theoritically. I live in a market where basements and rooms below grade are as rare as hen's teeth. But, I do have enough to know that is the way I look at the overall quality of a property. The market itself may show little difference in reaction to where the space is, as long as it is functional and provides a quality area in which to reside.
     
  3. DMZwerg

    DMZwerg Senior Member

    0
    Mar 25, 2009
    Professional Status:
    Certified Residential Appraiser
    State:
    Wisconsin
    I would compare it with 1620sf+/- GLA above grades.
    If possible use comps with at least partial finished basements (and especially good if you can find any matched pairs between comps).
    Adjust equally for rooms both above and below grade if that is what the market tells you or by whatever ratio or factor the market indicates (in most of my local markets it is 50% for below grade, but some are closer to 100%).

    If all else fails then maybe the Competency Rule applies and you can cancel the order?

    Good luck!
     
  4. 38Scarcello

    38Scarcello Member

    0
    Apr 26, 2004
    Professional Status:
    Certified Residential Appraiser
    State:
    Washington
    "In my professional opinion" I think that would be low(er) on your priority list.
    I have not been picked on for same bedroom count above grade in a long
    time. They want recent and within a close proximity. If U/W conditions you
    for it, write an addendum saying "There aren't any". Spell check it, sign it,
    and send the damn thing!
     
  5. Ray Christ

    Ray Christ Sophomore Member

    0
    Apr 17, 2002
    Professional Status:
    Certified Residential Appraiser
    State:
    Wisconsin
    Above Vs Below Grade

    I found the attached by Henry Harrison several years ago and use it as a guideline particularly when there is only 1 bedroom above grade. I also provide the following explanation in the report addenda >

    "Because of the style of the home and the way agents report the living area in the MLS he appraiser has selected the option to include that portion of the lower level in the GLA measurement that is at least 50% above grade and is classified as has normal size windows
    With this option to include the area in the GLA measurement elected special care is taken to be consistent throughout the form. We will not use the basement space on the room list."

    I have never in 16 years had an UW question it.

    Explaining what you do in detail is always helpful.
     

    Attached Files:

  6. Restrain

    Restrain Elite Member

    18
    Jan 22, 2002
    Professional Status:
    Certified General Appraiser
    State:
    Florida
    The easy answer is, find comps like the subject. Well, DUH! That obvious statement made, the problem is that there is an inconsistency in a lot of MLS and tax reporting as to above grade vs. total GLA. The only real answer is to analyze the sales in the market and try to find the most comparable sales, try to analyze any bedroom differentials, GLA above/below grade, walkout vs. non-walkout, etc.

    Good luck.
     
  7. Mile High Trout

    Mile High Trout Elite Member

    7
    Feb 13, 2008
    Professional Status:
    Certified Residential Appraiser
    State:
    Colorado
    Variable approaches

    In Colorado, above and below grade reporting will change from area to area. It's important to double check each proposed comparable with city records. In areas where these issues with high quality below grade living happen, realtors may indeed report that as above grade just because.
     
  8. Thomas Fiehler

    Thomas Fiehler Senior Member

    2
    Jun 2, 2003
    Professional Status:
    Certified General Appraiser
    State:
    Ohio
    What the he!! is the problem. If any part of a level is below grade then the entire level is below grade. Just because HH said, or rather wrote it, doesn't make it right. If your state recognizes ANSI, then that is a direct contradiction to that methodology. If its basement then call it basement and explain, explain, explain. I honestly don't understand why this pops up every couple weeks when its so darn simple to understand.
     
  9. Webbed Feet

    Webbed Feet Elite Member

    23
    Feb 11, 2005
    Professional Status:
    Certified Residential Appraiser
    Asking how to handle an appraisal analyses, and how to handle unreasonable underwriters, is not the same thing. And I suspect you are really asking about the later, not the former. Let us know.

    Also, I personally would be very careful if using Henry Harrison quotes out of context regarding my subject's situation and market. Tossing a hole in the ground basement into the GLA for no other reason besides dinking around with making it appear the GLA has more than one bedroom was NOT what I suspect Mr. Harrison was writing about at the time. If he was, he's free to post here, say so, and correct my lack of faith in that.... :nono:
     
  10. Webbed Feet

    Webbed Feet Elite Member

    23
    Feb 11, 2005
    Professional Status:
    Certified Residential Appraiser
    It's because real estate, and markets, are closer to a living thing than any set of arbitrary rules can account for. That's why.

    When I am faced with a subject bi-level (Split Entry) that has all it's levels 100% above grade..... But two of my comps of the exact same style each have one back corner of a lower level an entire 1% to 15% below a slightly sloped yard at that one corner.... It becomes not representative of the market to be splitting out 100% of the comps lower levels as "basements" over ANSI standards while blindly adhereing to ANSI for the subject and not doing so with it's lower level. Ya, end up with a screwed up comparison of what the market is reacting to. So, at times, we have to remain flexible, and so does underwriting.

    The above does not mean H.H. meant stick a 100% hole in the ground basement footage in GLA, and go comparing it to a 100% above grade two level house with no basement. But he can post what he meant if he so wishes... ;)
     
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