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FHA Missing Flooring

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The Scholar

Sophomore Member
Joined
Feb 13, 2021
Professional Status
Licensed Appraiser
State
Colorado
If you have a house with a room that only has a plywood floor or is partially plywood floor what does FHA require? Can you appraise it as-is with a cost to cure adjustment or could it be done subject to completion? Also, what if you have unfinished wood stairs which lead to a finished basement or unfinished wood stairs located in the GLA portion of the house? Does FHA require stair coverings/finish?
 
I believe the lack of floor covering or stairs is a marketability issue and a "significant" defect. Seems to me that without a replaceable floor covering you have potential damage from wear on the subflooring.
 
I believe the lack of floor covering or stairs is a marketability issue and a "significant" defect. Seems to me that without a replaceable floor covering you have potential damage from wear on the subflooring.
OK, so for FHA, can a property which is missing flooring be appraised as-is or does it need to be done subject to completion? Also, does the lack of floor covering apply to stairs?
 
OK, so for FHA, can a property which is missing flooring be appraised as-is or does it need to be done subject to completion? Also, does the lack of floor covering apply to stairs?
You won't find any references to your questions in 4000.1. I called the regional field office one time back in the day with a similar issue. The first question the guy asked me in return was "Well, are you going to include that room in your finished square footage area?" I have always required some level of "finish" on the walls and floors, "painted" meets my threshold. The FHA program was designed so people could move into a home and not have to spend any repair money on it for a couple of years. It wasn't designed for them to move into homes with substantial defects. Unfinished floors & stairs are a substantial defect.
 
Pretty sure that FHA does not require that a dwelling have finish flooring. Obviously, it can't be open to the ground. Whatever the condition of the property at the time of your inspection, that is what you report. The decision as to whether to do the appraisal as-is or subject to isn't yours. You have to consult with the Client. As someone already stated, you have to considered the reaction of the market to the lack of finish flooring.
 
seems like the lender will either let it go, or condition it to be covered. i would do an 'as is.. how much would floor covering affect the value? probable not much to nothing. unfinished basement wood stairs is not a concern to FHA, or the lender. and i have done a lot of FHA. if the lender sees the plywood in the photo, you need to say it is only cosmetic in nature, and not a required repair.
 
If me, after consulting the client, I would make it subject to a floor covering, permanently attached (not just throw rugs) and appropriate baseboard installed to cover the edges.
 
Keep in mind the 3 S's of FHA.........Safety, soundness and security.
 
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