I still hate ANSI

[Retired-70]

You want to show us where ANSI ever said you don't or can't include converted space as part of GLA? Let me help you a little bit. The term 'Gross Living Area' does not appear in the ANSI Z765 standard. ANSI Z765 is about measuring and calculating the square footage of a residence. FNMA (and the other GSEs) call the above ground, heated and finished areas GLA. The ANSI Z765 has existed since 1996. FNMA decided they wanted the residences they lend money on to be measured using the ANSI Standard. NOTHING CHANGED except now all resideintial appraiser doing appraisals destined for GSE loans are supposed to use the ANSI method for measuring and calculating the square footage of the dwelling. It's been 5 years. Surely the well to do 'Nando' can spare the $25 or so to buy a copy of the ANSI standard and to actually learn how to use it.

FYI:

To Grok: I am sure that around 2016, Fannie Mae's guidelines allowed an exception for homes built into a hillside.

Grok: "You are right that Fannie had language like that. I understated it earlier.

Around 2015-2022, the Selling Guide still said two things at once.

Default rule (same as now):
A level is below-grade if any portion of it is below-grade. A walk-out with finished rooms is not in the above-grade room count. Only finished above-grade area goes in GLA.

Comparison exception (the hillside paragraph):
If comparing above-to-above and below-to-below does not fit the style, the appraiser could deviate. Fannie’s example was:

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.

That is the exception you remember. It was not a blanket hillside waiver. All three tests had to fit: lower level substantially out of the ground, finish equal through the house, and the market treating the layout as one living area. Appraisers on the forums quoted that exact sentence from the Selling Guide in 2017.

What that did not mean

• Ordinary walk-out basements on flat or mildly sloped lots
• Finished basement that is still mostly in the ground
• “The market likes daylight basements” without the house being a true hillside design with continuous finish and function

Now

That hillside-GLA example is gone from current Fannie/ANSI policy. Grade is mechanical: any portion below grade → the level is below-grade finished area, not above-grade finished area. Value is still recognized on a separate line. GXX001- is retired and was never that hillside paragraph anyway.

So: yes, circa 2016 Fannie expressly allowed both levels in GLA for a true built-into-the-hill house that the market treated as one living area. That was a comparison/style exception, not a redefinition of grade. It is not available on a current Fannie ANSI assignment."

====
Grok: "It lived in the Single-Family Selling Guide, B4-1.3-05, Improvements Section of the Appraisal Report, in the Gross Living Area discussion — specifically the subsection on comparing above-grade to above-grade and below-grade to below-grade.
That is the same section appraisers cited in 2015–2019 as “pages 581–582” of the then-current PDF guide. The hillside sentence was Fannie’s own example of when the appraiser “may need to deviate” and “may require the gross living area to include both levels.”
When it came out of the Guide
Fannie does not publish a redline that says “hillside paragraph deleted.” The workable date is the ANSI rewrite of that same section:

• Announcement SEL-2022-03 (April 6, 2022) rewrote B4-1.3-05 to require ANSI Z765-2021 for GLA and non-GLA.
• Compliance for delivery: appraisals with an effective date on or after April 1, 2022.

After that rewrite the Guide still says a level is below-grade if any portion is below-grade and a walk-out is not above-grade area. The “built into the side of a hill … GLA to include both levels” example is gone. Current B4-1.3-05 (as revised again June 4, 2025 / SEL-2025-04) has no replacement for it.
Practical timeline

Period	Status of the hillside GLA sentence
Mid-2010s (including ~2016) through early 2022	In B4-1.3-05 as a comparison deviation
Appraisals effective April 1, 2022 and after	ANSI controls; that sentence is not in the Guide
Aug 8 / Sept 8, 2025	GXX001- also retired; no leftover opt-out that restores the old hillside GLA treatment

So: which guide = Selling Guide B4-1.3-05. When removed = when that section was converted to ANSI in SEL-2022-03, effective April 1, 2022. I have not seen an archived monthly PDF that pins the deletion to a single day between late 2021 and that announcement; the policy change that made the sentence impossible is that one."

 

[djd09]

socialism is a terrible way to drive the housing market...anyways just use the exception code

 

[Fernando]

FYI:

To Grok: I am sure that around 2016, Fannie Mae's guidelines allowed an exception for homes built into a hillside.

Grok: "You are right that Fannie had language like that. I understated it earlier.

Around 2015-2022, the Selling Guide still said two things at once.

Default rule (same as now):
A level is below-grade if any portion of it is below-grade. A walk-out with finished rooms is not in the above-grade room count. Only finished above-grade area goes in GLA.

Comparison exception (the hillside paragraph):
If comparing above-to-above and below-to-below does not fit the style, the appraiser could deviate. Fannie’s example was:


That is the exception you remember. It was not a blanket hillside waiver. All three tests had to fit: lower level substantially out of the ground, finish equal through the house, and the market treating the layout as one living area. Appraisers on the forums quoted that exact sentence from the Selling Guide in 2017.

What that did not mean

• Ordinary walk-out basements on flat or mildly sloped lots
• Finished basement that is still mostly in the ground
• “The market likes daylight basements” without the house being a true hillside design with continuous finish and function

Now

That hillside-GLA example is gone from current Fannie/ANSI policy. Grade is mechanical: any portion below grade → the level is below-grade finished area, not above-grade finished area. Value is still recognized on a separate line. GXX001- is retired and was never that hillside paragraph anyway.

So: yes, circa 2016 Fannie expressly allowed both levels in GLA for a true built-into-the-hill house that the market treated as one living area. That was a comparison/style exception, not a redefinition of grade. It is not available on a current Fannie ANSI assignment."

====
Grok: "It lived in the Single-Family Selling Guide, B4-1.3-05, Improvements Section of the Appraisal Report, in the Gross Living Area discussion — specifically the subsection on comparing above-grade to above-grade and below-grade to below-grade.
That is the same section appraisers cited in 2015–2019 as “pages 581–582” of the then-current PDF guide. The hillside sentence was Fannie’s own example of when the appraiser “may need to deviate” and “may require the gross living area to include both levels.”
When it came out of the Guide
Fannie does not publish a redline that says “hillside paragraph deleted.” The workable date is the ANSI rewrite of that same section:

• Announcement SEL-2022-03 (April 6, 2022) rewrote B4-1.3-05 to require ANSI Z765-2021 for GLA and non-GLA.
• Compliance for delivery: appraisals with an effective date on or after April 1, 2022.

After that rewrite the Guide still says a level is below-grade if any portion is below-grade and a walk-out is not above-grade area. The “built into the side of a hill … GLA to include both levels” example is gone. Current B4-1.3-05 (as revised again June 4, 2025 / SEL-2025-04) has no replacement for it.
Practical timeline

Period	Status of the hillside GLA sentence
Mid-2010s (including ~2016) through early 2022	In B4-1.3-05 as a comparison deviation
Appraisals effective April 1, 2022 and after	ANSI controls; that sentence is not in the Guide
Aug 8 / Sept 8, 2025	GXX001- also retired; no leftover opt-out that restores the old hillside GLA treatment

So: which guide = Selling Guide B4-1.3-05. When removed = when that section was converted to ANSI in SEL-2022-03, effective April 1, 2022. I have not seen an archived monthly PDF that pins the deletion to a single day between late 2021 and that announcement; the policy change that made the sentence impossible is that one."

Years ago I appraised a house in Pacifica, one of those 2 storied tract homes. Pacifica has a history of landslides so my subject was affected with soil from previous mud landslide causing the first story slightly below grade. Before ANSI, I included the 1st storied into the GLA. Now appraisers can't and will be different GLA from the other similar size tract home comps.

 

[Fernando]

For example, I appraised a two-story home in Daly City, legally an SFR (according to Planning). The owner had it split into 3 separate rooms and two units. Each of the 3 rooms had two separate entrances, front and back, and 1 bathroom, but no kitchen. For a kitchen, they all shared a communal kitchen. 3 of the units were in the back half of the house, stacked above each other, with stairs running up the back zigzag connecting balconies that had the back door. Then, on the front interior of these 3 units, another set of stairs connected them to a communal kitchen. They looked exactly like motel rooms - with a communal kitchen area. The front half had 2 units with separate bathrooms and kitchens. This was back in the 2000's. Now this "SFR" was completely approved by Daly City Planning. I can't think of any other city in the area that would allow this.

ANSI has different rules how to deal with InLaw units. I have no issue with that since appraisals with inlaw units are complicated and few similar such comps. Having modified garage conversion is different and should be left to appraiser judgement (unfortunately some appraisers don't have good judgement).

I discussed this in an appraisal class with the now-deceased and well-known Dawn Molitar-Gennrich (and others), and she injected into the discussion that Daly City had a lot of Filipinos and that I needed to take that into consideration.... I won't repeat her reasoning here, as some might take offense. Of course, the discussion was after the fact.

I took classes from Dawn. I think one was 1004MC. It was worse class, didn't learn anything except I can manipulate form as I wish.

The reality is that race and culture can play important roles in appraisal. But you keep such "comments" out of the appraisal report, even though there are behind-the-scenes issues that need to be addressed.

Of course, I didn't appraise it as an SFR. I wouldn't be surprised if they eventually found an appraiser who would!

If not for certain races and culture, some cities would lack demand and have their real estate values lower.
Such as Daly City and Colma are near cemeteries and some cultures do not want to live and see tombstones. Such knowledge would help agents but not as important for appraisers.

 

[Dublin ohio]

ANSI has different rules how to deal with InLaw units.

Wrong

didn't learn anything except I can manipulate form as I wish.

Wrong again

if not for certain races and culture, some cities would lack demand and have their real estate values lower.
Such as Daly City and Colma are near cemeteries and some cultures do not want to live and see tombstones

Racist

 

[Retired-70]

Actually, I appraised the house I was referring to twice over a 3-year period, over 20 years ago. And I conflated some details with another appraisal. Actually, Planning classified this one as a duplex with 2 garages, each with 2 bays. It also had those 3 motel-like rooms on the back. On the first appraisal, the mortgage broker did try to get me to appraise it as an SFR, but there was no way that could happen. They had to give me all the income and cost reccords. The owner was renting out to 5 different parties. The income was very significant. So, I used the Income Approach - and get this, I came out with a value that was higher than the current Zillow value. Well, I am very accurate on measurements, and my total GLA was very much higher, nearly double that on Zillow. Zillow doesn't have the correct values; maybe the current owner doesn't rent everything out. I wouldn't know.

But this property is far more valuable than it looks from the front of the house. It is those three motel-like rooms in the back. I would buy the property if I could get a good price, like the one currently on Zillow. But that would be crazy. A very nice income property. Imagine a nice-looking duplex in good condition, with 3 motel-like units in the back and separate front and back entrances. Spicy!

ANSI has different rules how to deal with InLaw units. I have no issue with that since appraisals with inlaw units are complicated and few similar such comps. Having modified garage conversion is different and should be left to appraiser judgement (unfortunately some appraisers don't have good judgement).

You are really impossible to communicate well with. You can neither read nor write correctly. There are no in-law units. An in-law must have a kitchen - and be approved as such.

I took classes from Dawn. I think one was 1004MC. It was worse class, didn't learn anything except I can manipulate form as I wish.

What do you expect from a 1004MC class? Or from most AI courses. They do have some decent courses. Or did in any case.

If not for certain races and culture, some cities would lack demand and have their real estate values lower.

That's racist.

Such as Daly City and Colma are near cemeteries and some cultures do not want to live and see tombstones.

Really?

Such knowledge would help agents but not as important for appraisers.

What does that have to do with anything?

 

[Fernando]

Actually, I appraised the house I was referring to twice over a 3-year period, over 20 years ago. And I conflated some details with another appraisal. Actually, Planning classified this one as a duplex with 2 garages, each with 2 bays. It also had those 3 motel-like rooms on the back. On the first appraisal, the mortgage broker did try to get me to appraise it as an SFR, but there was no way that could happen. They had to give me all the income and cost reccords. The owner was renting out to 5 different parties. The income was very significant. So, I used the Income Approach - and get this, I came out with a value that was higher than the current Zillow value. Well, I am very accurate on measurements, and my total GLA was very much higher, nearly double that on Zillow. Zillow doesn't have the correct values; maybe the current owner doesn't rent everything out. I wouldn't know.

One time I appraised a SFR with 2 ADUs and I believe it was funded. It had conditions.
Second time, refinance and lender had different set of conditions requiring me to make sure the illegal ADU had stove gas pipe capped.
Lenders have their own set of rules.

But this property is far more valuable than it looks from the front of the house. It is those three motel-like rooms in the back. I would buy the property if I could get a good price, like the one currently on Zillow. But that would be crazy. A very nice income property. Imagine a nice-looking duplex in good condition, with 3 motel-like units in the back and separate front and back entrances. Spicy!

You are really impossible to communicate well with. You can neither read nor write correctly. There are no in-law units. An in-law must have a kitchen - and be approved as such.

Where have you been? You didn't appraise many inlaws (too difficult for you). Back in old days, they were referred to many names - in law, mother in law, granny unit, but uncommon to be called ADU.

What do you expect from a 1004MC class? Or from most AI courses. They do have some decent courses. Or did in any case.


That's racist.


Really?

What does that have to do with anything?

When 1004MC was mandatory, I was first to take such a course and expected AI to clarify how to do the form. The class didn't clarify anything. Just like 3.6 classes I'd taken. I feel it's missing something like the form is too long and waste of them with so much irrelevant unimportant details for appraisers to dwell on.
And what's with the Racists throwing the word racist whenever they can (as we know from your Supremist views on gender, race, and IQ from your past posts). I was going to call you a racist for bringing up Filipinos living in Daly City (you just couldn't help yourself) which had no relevance in ANSI but you brought up racist issue. Glad you're not actively appraising.

 

[Fernando]

Wrong

Wrong.

Wrong again

Wrong again

Racist

What's with the trolling Racists in the forum throwing the word Racist whenever they want. Don't make yourself look worse. It's in your genes.

 

[Retired-70]

One time I appraised a SFR with 2 ADUs and I believe it was funded. It had conditions.

So?

Second time, refinance and lender had different set of conditions requiring me to make sure the illegal ADU had stove gas pipe capped.

So?

Lenders have their own set of rules.

Federal banking / safety-and-soundness rules. Banks and most mortgage lenders must follow FIRREA Title XI and the Interagency Appraisal and Evaluation Guidelines. Those require a real appraisal (or a permitted evaluation) by a competent, independent appraiser when the transaction needs one, and they bar the lender from pressuring value.

Appraiser Independence Requirements (AIR). Fannie and Freddie require the lender not to select, influence, or retaliate against the appraiser based on reaching a target value. That sits on top of older HVCC-style independence rules.

Fair lending and appraisal-bias rules. The Fair Housing Act, ECOA, and related CFPB/FHFA guidance apply to how the property is valued and how the appraisal is used. Discriminatory comparable selection, neighborhood comments, or “steering” value is not just a GSE defect; it is a legal problem. Fannie also requires lenders to monitor appraisals for prohibited language.

Consumer-disclosure rules. TILA/RESPA require the borrower to receive a copy of the appraisal promptly. ECOA has its own appraisal-notice and copy rules.

Representations to the investor. If the loan is sold to Fannie or Freddie, the lender warrants that the property was eligible and that the appraisal met the Guide. A bad ADU classification, ignored illegal use, or unsupported value can trigger repurchase even if the city later “lives with” the unit.

Where have you been? You didn't appraise many inlaws (too difficult for you). Back in old days, they were referred to many names - in law, mother in law, granny unit, but uncommon to be called ADU.

I have appraised many homes with in-laws, but definitions and laws are continually changing. CURRENTLY, in California, the term "in-law" is nothing more than living space for a relative. An in-law can be an ADU if it is a real independent unit with a full-kitchen, bedroom and exit to the exterior. In nearly all local regulations, the old term in-law has been replaced with ADU, with added stipulations. So, if I am talking about an appraisal I did 20 years ago - that was when regulations were what they were 20 years ago. Do you have to continually be such a moron?

When 1004MC was mandatory, I was first to take such a course and expected AI to clarify how to do the form.
The class didn't clarify anything.

It didn't clarify anything TO YOU. The fact is 1004MC is very simple.

Just like 3.6 classes I'd taken. I feel it's missing something like the form is too long and waste of them with so much irrelevant unimportant details for appraisers to dwell on.

That makes a lot of sense I am sure - well, at least for you. Well, in any case, 3.6 is less for appraisers and more for the GSEs.

And what's with the Racists throwing the word racist whenever

There you go you are throwing the word around again. You started it a long time ago.

they can (as we know from your Supremist views on gender, race, and IQ from your past posts).

It is interesting that you capitalize the word. I don't think I have done anymore than quote other articles. Mostly you are injecting your own bias into other people's posts. You are extremely biased and as dumb as any dumb MAGA and so on and so forth.

I was going to call you a racist for bringing up Filipinos living in Daly City (you just couldn't help yourself)

Is that the same as calling me a racist? 32-33% of adults living in Daly City are Filipinos, according to Grok. I am NOT currently a licensed appraiser - I can certainly report factual information you can get from federal Census Bureau stats.

which had no relevance in ANSI

So what?

but you brought up racist issue.

You keep brining it up repeatedly

Glad you're not actively appraising.

Nasty you are.

 

[Fernando]

So?

I can ramble as much as you.

So?

You're not the only one with complex properties.

Federal banking / safety-and-soundness rules. Banks and most mortgage lenders must follow FIRREA Title XI and the Interagency Appraisal and Evaluation Guidelines. Those require a real appraisal (or a permitted evaluation) by a competent, independent appraiser when the transaction needs one, and they bar the lender from pressuring value.

Appraiser Independence Requirements (AIR). Fannie and Freddie require the lender not to select, influence, or retaliate against the appraiser based on reaching a target value. That sits on top of older HVCC-style independence rules.

Fair lending and appraisal-bias rules. The Fair Housing Act, ECOA, and related CFPB/FHFA guidance apply to how the property is valued and how the appraisal is used. Discriminatory comparable selection, neighborhood comments, or “steering” value is not just a GSE defect; it is a legal problem. Fannie also requires lenders to monitor appraisals for prohibited language.

Consumer-disclosure rules. TILA/RESPA require the borrower to receive a copy of the appraisal promptly. ECOA has its own appraisal-notice and copy rules.

Representations to the investor. If the loan is sold to Fannie or Freddie, the lender warrants that the property was eligible and that the appraisal met the Guide. A bad ADU classification, ignored illegal use, or unsupported value can trigger repurchase even if the city later “lives with” the unit.

I have appraised many homes with in-laws, but definitions and laws are continually changing. CURRENTLY, in California, the term "in-law" is nothing more than living space for a relative. An in-law can be an ADU if it is a real independent unit with a full-kitchen, bedroom and exit to the exterior. In nearly all local regulations, the old term in-law has been replaced with ADU, with added stipulations. So, if I am talking about an appraisal I did 20 years ago - that was when regulations were what the were 20 years ago.
Do you have to continually be such a moron?

You're the one who is making the terminology a big deal.

The 1004MC became mandatory in 2009. AI for appraisal certainly didn't exist then. So, ...

AI = Appraisal Institute
AI been around longer than AI. And you said you were in Appraisal Institute?

It didn't clarify anything TO YOU. Apparently because you had AI tell you back in 2009 what it was all about. Ha ha ha.


That makes a lot of sense I am sure - well, at least for you. Well, in any case, 3.6 is less for appraisers and more for the GSEs.


There you go you are throwing the word around again. You started it a long time ago.

It is interesting that you capitalize the word. I don't think I have done anymore than quote other articles. Mostly you are injecting your own bias into other people's post. You are extremely biased as dumb as any dumb MAGA and so on and so forth.


Is that the same as calling me a racist? 32-33% of adults living in Daly City are Filipinos, according to Grok. I am NOT currently a licensed appraiser - I can certainly report factual information you can get from federal Census Bureau stats.

Again why mention Filipinos in Daly City. What's your point? Glad you're not practicing. You give real appraisers a bad name.

So what?

You keep brining it up repeatedly

Nasty you are.

Stay in your mancave and work on your useless impractical academia models.