Quad Level - Whats in GLA?

[Mark K]

In this area it would be called a tri-level w/basement, again, as you said, with the lowest level below the at-grade level and the partially below-grade level below the upper level.

As long as you use similar comps, there shouldn't be an issue. We don't have many tri's w/bsmt but we have a lot of older tri-levels. I've always combined the upper 2 levels for the living space and called the lower levels basement and used tri-level comps. Those comps w/out bsmts are adjusted for lack thereof, generally adjusted at about $5-10/sf for the 600 s.f. +/-.

In this area, tri-levels are considerably less desirable than one or two level homes and to compare the lower living area to the one story above grade comps would be misleading.

If you use similar comps, what does it matter what you call it? F/F says to call it bsmt but that doesn't mean you can't give it close to or the same value as above grade space if the local market so indicates.

 

[Sid Holderly]

For me It depends on the comps you have. If you have 3 similar layout and the MLS includes all in GLA. If you do not have three similar comps it is often easier to split it for adjustment purposes to 2 stories with basements or tri-levels with true basements. either way it will take explanation. Agent and/or county allocation of finished area often has to be interpreted, allocated and recalculated for our purposes. Already have the explanation in a prominent location on the form ready for QC questions.

 

[Tim Hicks (Texas)]

The value may be credible doing it as you suggest .. the question comes in as to whether it is misleading to split the living area based on above or below grade purely because it is a "form" requirement? I can certainly see an argument that it is misleading IF the market considers the space all living area.

It would not be misleading if you have other sales with similar below grade areas and you can determine the splits. It would be misleading to include it in GLA if you have other sales with similar below grade areas that show the market effect of the below grade areas is different than homes without below grade living areas.

 

[Rich Heyn]

For liability purposes, it's better to distinguish between partially below-grade square footage and above-grade square footage.

 

[residentialguy]

4 level splits are nothing but ramblers or ranches the have been split down the middle and one side is raised up a 1/2 story. the Bottom 2 levels still act as a basement. Don't get all bent out of shape with the ground level. When you're in the house, you wouldn't know the difference if it was at ground level or a 1/2 foot below.

 

[Deleted member 128537]

Wait until you do a earth home (basically nothing above grade).

 

[Tim Hicks (Texas)]

For liability purposes, it's better to distinguish between partially below-grade square footage and above-grade square footage.

That's my opinion, but so many will use "market acceptance" as an out.

 

[Sandra Subotich]

UPDATE!

Just to let you know how this was resolved. (in case your up against this one day)

I told the AMC that I want 2 certified appraisers to go over my report and get on a conference all to resolve this matter. (they will probably never use me again and I don't care).

They told me that out east they treat anything 50% below grade as a basement so they wanted me to do the same.

I told them that is not how the market treats Quad level styles in Michigan first of all, second if I have 3 sold sales of the same style they will all be consistently treated the same per FNMA and I can deviate from guidelines lines so long as I explain myself. They had nothing to say in response to that.

Conclusion - the basement is 100% below grade and is considered a basement, anything that was 50% above grade is in GLA and noted in the report as GLA as this is how the market treats this style of home.

 

[residentialguy]

The lower level is 50% below grade, it has a bedroom, half bathroom and living room.

Hey Sandra,

I'm one for not being stuck on ANSI. However....You're using the term "living room" here. Typically in a "tri-level" (which is essentially a 4 lvl split), the living room is on the main level with the kitchen (or sometimes on the upper level) and this lower room is a family room, similar in function to a split entry with a finished lower level fam bed bath set up, or even a rambler with a finished basement. And I'm from Michigan and lived in a multi level like you're describing. It's still the basement, unless you don't have a living room on the upper 2 levels. Finished basements have living space...but they're not considered GLA

 

[Mike Kennedy]

Thanks guys. I have a network of appraisers they count it as GLA like I would as this is how the market treats a Quad Level.

I will. I found this too:

Fannie Mae XI 405.05

The appraiser may deviate from this approach if the style of the subject property or any of the comparables does not lend itself to such comparisons. However, in such instances, he or she must explain the reason for the deviation and clearly describe the comparisons that were made So as long as the appraiser can define consistent comparables with below grade and above grade areas, and they give reasonable cause, below grade areas can be included.

I think I'm going to throw this back at them.

Don't forget to copy / quote the preceding multiple times Fannie categorically asserted (in boldface) in the same Guideline that Below grade basements MUST not be included in the GLA estimate - then bent over to Lender Pressure and "stuck in" the guideline you posted above.

Printed copies may not be the most current version. For the most current version, go to the online version at
https://www.fanniemae.com/singlefamily/originating-underwriting. 595

Evaluating Above-Grade Room Count
The most common comparison for one-unit properties is the above-grade gross living area. Appraisers must be consistent when calculating and reporting finished above-grade room count and square footage for the gross living area above-grade.

A level is considered below-grade if any portion of it is below-grade—regardless of the quality of its finish or the window area of any room. A walk-out basement with finished rooms would not be included in the above-grade room count.

The following must be observed when calculating and reporting above-grade room count and square footage for the gross living area:
• Only finished above-grade areas can be used in calculating and reporting of above-grade room count and square footage for the gross living area.
• Garages and basements, including those that are partially above-grade, must not be included in the above-grade room count.

Below-Grade Areas
Rooms that are not included in the above-grade room count may add substantially to the value of a property—particularly when the quality of the finish is high.
The appraiser must report the basement or other partially below-grade areas separately and make appropriate adjustments for them on the “basement and finished areas below-grade” line in the “sales comparison analysis” grid.

Appropriate Above-Grade and Below-Grade Comparisons
To ensure consistency in the sales comparison analysis, appraisers must compare above-grade areas to above-grade areas and below-grade areas to below-grade areas.

magic wand - uh oh damn wait justtttttt a minute - if we wanna keep our phoney-baloney jobs and keep making more and more money for our "investors" and increase our stock price , we better add:

Appraisers may deviate from this approach if the style of the subject property or any of the comparables does not lend itself to such comparisons. However, in such instances, the appraiser must explain the reason for the deviation and clearly describe the comparisons that were made."
_____________________________________________________________________________________________________

Other Markets' histories may vary - in NY it is the #1 way "values" were inflated in 2003-2007.

Let's see - ya got a 1955 Ranch with 1500sf GLA (above grade) and a 1500sf finished below grade Basement. (let's say GLA = $100./psf)

Wave the magic green wand and BAMM ......ya now got a 3,000sf GLA "2 story" home.

soooooo wonder of all wonders - a $150,000. doubled in "value" - overnight. So did Reelators' Commissions.

Interviews with Assessors consistently confirmed - "you know it's only 1500sf (per Building Department C.of O. records), WE know it's only 1500sf GLA - BUT - if the Reelators are listing them and marketing them and selling them as 3,000sf - we will ASSESS them the same way. We are allowed to do that. IF you want to find out whether or not the Finished Basement is similar in quality, finish, and utility - get inside. If you want to confirm legal use - go see the Building Inspectors. We review MLS listings and tax properties accordingly. P.S. Assessors are in the buz of increasing tax revenue for their municipality.

Interestingly, until 1 year ago - our MLS provided direct access to County Assessment property cards which typically reflected the real distinction betw. above and below grade areas as well as all known, legal usage (cross referenced with Building Department C.O. records). When our local MLS merged with a much larger MLS on the east side of the Hudson River - another magic wand was waved - Detailed County Assessment records were no longer available - REALIST must be used via MLS - though REALIST does report total GLA (assessor) plus GLA per MLS listings. Confirmation with "live" Assessor personnel is therefore a REAL necessity - as the physical property cards ARE still in existence and confirmation IS allowed per Assessors (public info).

A significant fact - those Lenders who rely upon AV-hums, and BPOs at 10-50 bucks a shot with 3-8 hour TAT and accept MLS info as "gospel" - continue to perpetrate intentional inflation of "values".

"But MLS SAYSSSSSSS" - can be heard throughout the state defending over-valued properties.

Should this be occurring in your locality - "watch your back" folks. Research, identify, and verify. DO NOT rely solely on MLS records or the myriad of on-line "data" sources which do NOT.