Below Grade Kitchens (only Kitchen)?

[kdubz]

Has anyone had experience with these split levels in the Marynook neighborhood on the south side of Chicago that has the only kitchen in the basement (lower level)? The front of the house is grade and the lot slopes to the rear which allows you to walk out of the kitchen to the back yard but is not at street level or level with the front of the house. It looks like it slopes about 2.5' from front to back. The issue i'm having is the lender has another appraisal and the other guy used the kitchen area in the total GLA for the subject which puts it at 1,340sf. Public record and my measurements put it at 970sf (PR) & 1004sf (hand measured). I'm going off Fannie Mae's guidelines which say any part of the home below grade can not be used in the GLA. There was one identical comp which public record has the GLA at 970sf and the rest of the comps I adjusted for GLA and functional utility. The lender said the other appraiser had the GLA for the similar comp at 1,340 which I question because thats 370sf larger than public record has it. The lender is saying that since I'm saying the kitchen is below grade the subject really doesn't have a kitchen. I've appraised 4 of these split levels over the last seventeen years and have been consistent each time and explained the hell out of it in the addendum but this is the first time I ran into this issue with a lender.

 

[Pat Butler]

From the Selling Guide-

"For consistency in the sales comparison analysis, the appraiser should compare above-grade areas to above-grade areas and below-grade areas to below-grade areas. The appraiser may need to deviate from this approach if the style of the subject property or any of the comparables does not lend itself to such comparisons. For example, a property built into the side of a hill where the lower level is significantly out of ground, the interior finish is equal throughout the house, and the flow and function of the layout is accepted by the local market, may require the gross living area to include both levels. However, in such instances, the appraiser must be consistent throughout the appraisal in his or her analysis and explain the reason for the deviation, clearly describing the comparisons that were made."

Also, don't let the form override common sense. Even if you were forced to allocate the GLA, for reporting purposes, so that the kitchen wasn't include as GLA- it still is there and would only require an explanation as to what you did.

I live in an area where we have lots of bi-level houses. Some were built with the lower level partially below grade while others were built entirely above grade. Buyers pay the same for either choice, so it's common to re-allocate the living areas of the comps to match the subject property so long as a clear explanation is given as to what you did.

 

[Jay Emmar]

Has anyone had experience with these split levels in the Marynook neighborhood on the south side of Chicago that has the only kitchen in the basement (lower level)? The front of the house is grade and the lot slopes to the rear which allows you to walk out of the kitchen to the back yard but is not at street level or level with the front of the house. It looks like it slopes about 2.5' from front to back. The issue i'm having is the lender has another appraisal and the other guy used the kitchen area in the total GLA for the subject which puts it at 1,340sf. Public record and my measurements put it at 970sf (PR) & 1004sf (hand measured). I'm going off Fannie Mae's guidelines which say any part of the home below grade can not be used in the GLA. There was one identical comp which public record has the GLA at 970sf and the rest of the comps I adjusted for GLA and functional utility. The lender said the other appraiser had the GLA for the similar comp at 1,340 which I question because thats 370sf larger than public record has it. The lender is saying that since I'm saying the kitchen is below grade the subject really doesn't have a kitchen. I've appraised 4 of these split levels over the last seventeen years and have been consistent each time and explained the hell out of it in the addendum but this is the first time I ran into this issue with a lender.

Based on your above, I would say you are the credible appraiser here. At first glance I was going to say, "simple, find an identical comp" but you have that. The other appraiser most likely saw that the subject and the model-match comp were virtually identical, so s/he changed the GLA to suit his/her needs and make the report nice and pretty. If I were in your position I would stand firm as it appears that you are the one that is correct. Send the lender your supporting data, fannie quotes regarding GLA / basements, copies of assessor sheets, etc., and let them go back to the other appraiser and make them explain their inaccuracies

 

[Terrel L. Shields]

The lender and/or UW is an idiot. The fact that a kitchen exists outside the defined GLA does not mean the home does not have a kitchen. Either way, it's still the same house and design and the SF adjustment is likely very close or identical for the whole property or the GLA & lower level segregated.

 

[Riick]

The lender and/or UW is an idiot. The fact that a kitchen exists outside.....

How do they find the idiots for U/W jobs?
I think there's a fortune to be made for anyone who can identify and offer more idiots & imbeciles to the banking community.
Stupid is as Stupid does