ANSI issue with new home

[sailorboy]

I am working on an appraisal of a new upper end custom home. A small portion of the rear wall (about 10 linear feet) is below grade along the stairway and one bedroom. The grade runs from 3" to 1.7' above the finish floor. I understand that ANSI requires if any portion is below grade the entire area has to be considered (or at least shown) as below grade (basement). This would mean that this is a 765 GLA home with one bedroom and one bath having a basement area of 1,542 s.f. with living room, kitchen, 2 baths, and 2 bedrooms. I am thinking of using the GXX001 exception for ANSI. Not sure if this fits this exception. My reasoning is that the market sees this entirely as a two story home (I almost did not see the small portion below grade myself). Additionally, because the market sees this as two story home with no basement, I will not be using any comparables with basements. I could follow ANSI and have very large adjustments in the sales comparison approach that cancel each other out while creating a very confusing report. Trying to decide if I follow ANSI showing basement or use the more logical approach and develop a report that can be easily understood. Almost wish I had not seen this very small below grade area. This is for FNMA.

 

[Overimprovement]

I vote for GXX001 and plainly explain your reasoning. What you have written here will do quite nicely.

Now for why--we are supposed to answering a question--what is the market value of this property? ANSI is far too restrictive, and using it here, IMHO, would provide a misleading report, necessitating using as comparables homes many buyers of this home would never consider.

Just explain, you should be fine.

 

[glenn walker]

don't try to make it Ansi if its recognized as GLA...new homes have architects and permits...what do they show as GLA? Also Fannie as I recall allows you to explain how the market recognizes the living area. My concern would be going down a rabbit trail making bogus adjustments when the buyer..builder...architect have a new home permitted as X GLA and you start chopping up an area when it's not really a basement. Just my thoughts.

 

[sailorboy]

Thanks, that was my original approach but after researching ANSI, I am using market acceptance of this home to justify using GXX001 rather than not being able to accurately measure as an out. I've thoroughly explained why I'm using GXX001 so will go ahead hoping it doesn't get flagged. I've given up with FNMA using any logic. I just got a letter of reprimand from them for calling a retirement community a retirement community.

 

[glenn walker]

P.S. pretend your a buyer and set aside Anzi..how would you view that part of the living area ? Is it finished to the same quality and design of the rest of the house ? If so it's not a finished basement and will be recognized in the market as normal GLA...Ansi is a guideline not a law and it was designed to be able to separate inferior area to above ground GLA...also you can value that area the same with no different cost is the same or similar finish and quality. Keep it simple and just explain why you didn't seperate it. Your lucky it's new and not an addition if lower cost and quality.

 

[Overimprovement]

I just got a letter of reprimand from them for calling a retirement community a retirement community.

Half the people who post here could legally live in a retirement home.

 

[sputnam]

The key to the Sales Comparison Approach is always... and always has been... selecting sales that will give you apples to apples comparisons. What you are talking about is an issue of what you call the areas. The property is what it is and the market determines what it's worth. Whatever way you treat the square footage, be clear and treat the somparable sales in the same way.

 

[Tom D]

Half the people who post here could legally live in a retirement home.

I resent you doxing me.

Never had an issue when i used the exemption. How the h^ll do we know ansi wise what the comps are. This exemption is less painful than the stips you would get for non similar comps.

 

[glenn walker]

There is an exemption but you explain it and why it doesn't apply. Do you think a Geodesic Dome is Anzi ? Are those $10 million dollar partially in Hills Mansion's in Beverly Hills considered below ground basements ? No there recognized by the market..builders and architects as real GLA and Architects don't give a crap about Fannie's Anzi guidelines. Common sense and knowing your market and buyers perception is what counts. Want to get sued biggley ? Just Call a billionaires house a basement and make a lower $ Cost Per Square Foot adjustment than on your similar in hill comparables...then wait until his expert witness is a famous Hollywood Architect who shows up with what's GLA and what's not... your $1 million E & 0 policy just got short by millions and your new career is at Flip and Dip Deli in East LA.....Lmao

 

[Alsie35]

This whole thread is why I NEVER do any appraisals on homes that have this BS issue since ANSI kicked off. Thankfully, between the mostly level topography around here, and the South Texas builders' penchant for building up foundations - even 7,8,9 feet of concrete tall in the rear if need be, so as to have a level home (heavy concrete foundations are important here due to the shifting soil type) - I don't run into it often.

In the 3 years since ANSI was published, I've gone to exactly two (2) homes where "Surprise!" the lower level backed into the hill (could not tell from public records or MLS photos). In both cases I called the client and withdrew from the assignment. Because - life is too short.

All I'm going to say is that I sure am glad I didn't have to deal with this ANSI nuance when I was going up and down hills all over NorCal in a "past appraising life"!!!!