Tim Hicks (Texas)
Elite Member
- Joined
- Jan 15, 2002
- Professional Status
- Certified Residential Appraiser
- State
- Texas
I did that for many years until I realized nobody cared.
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Sketching Functional Obsolescence
- Thread starter juck224
- Start date
Terrel L. Shields
Elite Member
- Joined
- May 2, 2002
- Professional Status
- Certified General Appraiser
- State
- Arkansas
In 34 years, I don't recall a client who ever asked for interior walls, not even when I was doing FHA and Secondary market work.
juck224
Freshman Member
- Joined
- Jan 16, 2025
- Professional Status
- Licensed Appraiser
- State
- Wisconsin
B4-1.2-01, Appraisal Report Forms and Exhibits (09/03/2025)
"A floor plan is required for the following:
- all property data collections,
- hybrid appraisals,
- desktop appraisals, and
- traditional appraisals when the layout of the dwelling unit(s) is atypical or functionally obsolete, limiting the appeal of the property in comparison to competitive properties in the market area."
juck224
Freshman Member
- Joined
- Jan 16, 2025
- Professional Status
- Licensed Appraiser
- State
- Wisconsin
what does ansi say about it...nothing
B4-1.2-01, Appraisal Report Forms and Exhibits (09/03/2025)
"A floor plan is required for the following:
- all property data collections,
- hybrid appraisals,
- desktop appraisals, and
- traditional appraisals when the layout of the dwelling unit(s) is atypical or functionally obsolete, limiting the appeal of the property in comparison to competitive properties in the market area."
djd09
Elite Member
- Joined
- May 20, 2009
- Professional Status
- Licensed Appraiser
- State
- Ohio
Frequently Asked Questions
Q1. Why does Fannie Mae require appraisers to follow the ANSI standard?
Valuations of residential property correlate strongly with the dwelling’s square footage. Our adoption of the ANSIstandard:▪ Provides a professional and defensible method for the appraiser;▪ Allows transparent and repeatable results for consumers of appraisal reports; and▪ Creates alignment across market participants.One key factor in our decision to adopt the ANSI standard is the recent emergence of new technologies, such asphone apps, which can measure houses, generate floor plans, and calculate square footage. In addition, thedesktop and hybrid appraisal options require a floor plan. Since appraisers are not inspecting the propertypersonally for these appraisals, we anticipate they will commonly receive the floor plan from a third party, so itmakes sense that all parties (including the appraiser) would be using the same standards of measurement. ANSIZ765-2021 is a standard that technologies can build to, other parties (such as real estate agents) can anticipate,and appraisers can create or consume with confidence.
Q20. How should appraisers value finished areas that do not meet the ANSI standard?
Our longstanding policy on adjustment rates has not changed: we require appraisal adjustments to reflect marketreaction. This is explained in the Analysis of Adjustments section of Selling Guide B4-1.3-09, Adjustments toComparable Sales and the corresponding section SB4-1.3-09 in the UAD 3.6 Policy Supplement: “The expectationis for the appraiser to analyze the market for competitive properties and provide appropriate market-basedadjustments...” It is up to the appraiser to determine the market reaction for nonstandard and noncontinuousfinished areas, which may be greater than, less than, or equal to that of the finished areas.
ansi doesn't require interior wall measurements...or cares about functional obsolescence
Q1. Why does Fannie Mae require appraisers to follow the ANSI standard?
Valuations of residential property correlate strongly with the dwelling’s square footage. Our adoption of the ANSIstandard:▪ Provides a professional and defensible method for the appraiser;▪ Allows transparent and repeatable results for consumers of appraisal reports; and▪ Creates alignment across market participants.One key factor in our decision to adopt the ANSI standard is the recent emergence of new technologies, such asphone apps, which can measure houses, generate floor plans, and calculate square footage. In addition, thedesktop and hybrid appraisal options require a floor plan. Since appraisers are not inspecting the propertypersonally for these appraisals, we anticipate they will commonly receive the floor plan from a third party, so itmakes sense that all parties (including the appraiser) would be using the same standards of measurement. ANSIZ765-2021 is a standard that technologies can build to, other parties (such as real estate agents) can anticipate,and appraisers can create or consume with confidence.
Q20. How should appraisers value finished areas that do not meet the ANSI standard?
Our longstanding policy on adjustment rates has not changed: we require appraisal adjustments to reflect marketreaction. This is explained in the Analysis of Adjustments section of Selling Guide B4-1.3-09, Adjustments toComparable Sales and the corresponding section SB4-1.3-09 in the UAD 3.6 Policy Supplement: “The expectationis for the appraiser to analyze the market for competitive properties and provide appropriate market-basedadjustments...” It is up to the appraiser to determine the market reaction for nonstandard and noncontinuousfinished areas, which may be greater than, less than, or equal to that of the finished areas.
ansi doesn't require interior wall measurements...or cares about functional obsolescence
Tom D
Elite Member
- Joined
- May 22, 2015
- Professional Status
- Certified Residential Appraiser
- State
- Pennsylvania
Minimalism is a more function life than data minutia thinking.
I miss my ruler & magic marker to draw a rectangle representing the dwelling. And in terms of money and time, l had more of it back then in terms of buying power.
According to the 3.6 pushers, it will only take 15 minutes to do the form, they just say it will be done faster. Hahahaha.
I miss my ruler & magic marker to draw a rectangle representing the dwelling. And in terms of money and time, l had more of it back then in terms of buying power.
According to the 3.6 pushers, it will only take 15 minutes to do the form, they just say it will be done faster. Hahahaha.
Terrel L. Shields
Elite Member
- Joined
- May 2, 2002
- Professional Status
- Certified General Appraiser
- State
- Arkansas
No. That is Conforming Conventional lending rules. It has nothing to do with non-conforming loans that are about 40% of all residential loans and virtually 100% of all commercial appraisals. It is totally NOT a requirement of non-conforming loans. Never was. And
Which means 90% of all secondary market appraisals do not require it. Appraisers need to understand that not everything is FNMA. Far from it.
Tim Hicks (Texas)
Elite Member
- Joined
- Jan 15, 2002
- Professional Status
- Certified Residential Appraiser
- State
- Texas
If you are discussing functional deficiencies in a floor plan, it is a good idea to demonstrate the deficiency on your sketch. Incredibly, at least once a year I get a assignment where that third claimed bedroom is only accessed by going through another bedroom. What about when a bedroom is on one side of the house and all the baths are on the other or on another floor? More likely a study or den, but agents want everything to be a bedroom. Typically, you don't have a bedroom with its only access through the entry/foyer, but it is coming rather common lately.
djd09
Elite Member
- Joined
- May 20, 2009
- Professional Status
- Licensed Appraiser
- State
- Ohio
Question: Why are you requiring floor plans? How does Fannie Mae anticipate appraisers will get access to the floor plans of the homes?
Lyle Radke: We want to make sure that appraisers have all the information they need to formulate a credible opinion of value. If they don’t understand the functional utility of the property, that may prevent them from accurately performing the assignment. Those around the appraiser, the lender, the listing agent, they are the ones who are going to have to step up and provide the floor plan. It’s intended to be something to help the appraiser to have enough information to do their job.
Functional utility refers to the flow of the floor plan. Is the function of the floor plan useful? Let’s say, for example, you’ve got a house where you come in the garage and as you enter the garage you’re stepping into the bathroom. That would have an effect on the value. Functional utility absolutely impacts value. People pay more for houses that flow well.
How do you get from the garage to the kitchen? What kind of privacy do you have in those situations? These questions are important to establishing a home’s value. Appraisers already adjust for functional obsolescence. It is a longstanding requirement for all Fannie Mae appraisals. In fact, we already require appraisers to provide a floor plan in cases where they identify functional obsolescence.
how do you get to the kitchen...the front door wtf
Lyle Radke: We want to make sure that appraisers have all the information they need to formulate a credible opinion of value. If they don’t understand the functional utility of the property, that may prevent them from accurately performing the assignment. Those around the appraiser, the lender, the listing agent, they are the ones who are going to have to step up and provide the floor plan. It’s intended to be something to help the appraiser to have enough information to do their job.
Functional utility refers to the flow of the floor plan. Is the function of the floor plan useful? Let’s say, for example, you’ve got a house where you come in the garage and as you enter the garage you’re stepping into the bathroom. That would have an effect on the value. Functional utility absolutely impacts value. People pay more for houses that flow well.
How do you get from the garage to the kitchen? What kind of privacy do you have in those situations? These questions are important to establishing a home’s value. Appraisers already adjust for functional obsolescence. It is a longstanding requirement for all Fannie Mae appraisals. In fact, we already require appraisers to provide a floor plan in cases where they identify functional obsolescence.
how do you get to the kitchen...the front door wtf