RAC offered a free one-hour ANSI webinar to provide clarity to appraisers everywhere. RAC Member and Past President Byron Miller, SRA, AI-RRS, a contributor to the 2021 ANSI standards manual Z765-2021, discussed appropriate measuring standards and updates that Fannie Mae has made effective April 1, 2022. Byron was interviewed by RAC member and Past President Jonathan Miller, CRE, CRP.
ATTENTION To all of the non-RAC members that joined the presentations, rest assured RAC provides useful, actionable, information to its members during these monthly town halls, plus you connect with a wonderful group of members (that always have something to say or contribute).
Materials that were discussed in the webinar
– Fannie Mae: Standardized Property Measuring Guidelines
– Fannie Mae: (Selling Guide) How is the gross living area measured and calculated?
– Home Innovation Research Labs: Purchase the ANSI Standards (these standards are copyright protected.)
The Webinar Video
Here is the video of the March 31, 2022 RAC ANSI Webinar:
Additional ANSI Insights
After you’ve watched our March 31, 2022 RAC ANSI Webinar, you might want to take a look at some topics Byron Miller prepared for the webinar (answers in ALL-CAPS):
* What is the ANSI standard and how do you get a copy? STANDARD FOR MEASURING SINGLE FAMILY RESIDENIAL HOMES; WWW.HOMEINNOVATION.ORG
* What constitutes a standard? SOMETHING PEER-REVIEWED
* What constitutes being peer-reviewed, and why is that important from say an ad-hoc “standard?” IT INVOLVES INCLUDING INDUSTRY STAKEHOLDERS. IT IS A DEFINED PROCESS, PROVIDING PUBLIC COMMENT, AND PUBLIC FEEDBACK. AD-HOC IS TYPICALLY IS A SINGLE PERSON OR ENTITY THAT DEVELOPS, AND DOES NOT EXPOSE TO PUBLIC FOR FEEDBACK.
* Why use a standard? ie: what are the benefits of standardization? CONSISTENCY, REDUCES VARIABILITY & LIABILITY
* How often is the standard updated? VARIES, ON AVERAGE EVERY 10 YEARS
* How does this differ from HUD, USDA, & VA requirements for measuring? THOSE ARE NOT STANDARDS BUT ARE ASSIGNMENT CONDITIONS OF GSE (GOV’T SPONSORED ENTERPRISES. THIS IS A SUBTLE BUT IMPORTANT DISTINCTION. LOOSELY, THEY COULD BE CONSIDERED “AD-HOC” STANDARDS.
* How do you get on the consensus committee? APPLY, HOME INNOVATION PUT OUT SOLICITATIONS.
* Can you describe the process involved in making changes via the consensus committee? REVIEWED ALL COLLECTED QUESTIONS, PRIORITIZE, PROPOSE CHANGES, EXPOSE TO THE PUBLIC, ITERATE
* Can you talk about some of the items that you were aware of that give appraisers the most heartburn regarding the standard? Egs: stairs, sloped ceilings, areas under the stairs (unfinished basement caveat), bump-outs (fireplace, non-floor to ceiling bay areas, etc.), ceiling heights. HANDS DOWN – STAIRS.
* How does gross living area relate to the Z765 standard? IT DOESN’T, Z765-2021 DOES NOT DEFINE OR DISCUSS GLA, IT DEFINES ABOVE-GRADE, BELOW-GRADE, FINISHED, AND UNFINISHED SF.
* What about below-grade square footage? BELOW-GRADE SF IS DEFINED IN THE Z765-2021 STANDARD. IN SHORT, THE STANDARD CONSIDERS ANY AREA THAT HAS EVEN A FRACTION OF IT’S OVERALL BELOW-GRADE AREA TO BE COUNTED IN WHOLE AS BELOW-GRADE SF. THERE IS ONE POSSIBLE EXCEPTION, AS INDICATED IN THE STANDARD. HOWEVER, I LEAVE THAT TO APPRAISERS TO READ FOR THEMSELVES IN THE STANDARD.
* And what about the concern regarding using the comparables? USE THE SAME APPROACH THAT YOU CURRENTLY DO IN DEALING WITH MULTIPLE DATA SOURCES.
* The ANSI Z765 standard is a residential measurement standard for single-family dwellings. Can a be used for multi-family dwellings? NO
* What about measuring using condominiums? ANNEX P.4 IN ANSI STANDARDS
* There are certain situations where you could be measuring a finished second-story dwelling with sloped ceilings, or for that matter, a third-story sloped finished area that has no square footage as per the ANSI standard. What does Fannie say about handling that situation? COULD USE EXCEPTION “GXX001”
* What about berm homes, which are homes that are buried either completely or mostly below grade? “GXX001” – EXCEPTION
* Can I use the Z765-2021 on a 1025 form? NO
* What about on a desktop appraisal? – IT IS NOT REQUIRED BUT RECOMMENDED.
* How do I conform to the ANSI standard? That is, can I claim partial conformance to the standard? NO
* What is the level of granularity of measurements? MEASURE TO INCH OR TENTH OF FOOT ENGLISH MEASUREMENT SYSTEM, OR TENTH OF METER (DECIMETER) METRIC MEASUREMENT SYSTEM. RESULTS ROUNDED TO THE NEAREST FOOT OR METER.
* What is measured? ALL IMPROVEMENTS, EGS: DECKS, PATIOS, PORCHES, BREEZEWAYS.
* What about ADUs, outbuildings, and garages? Z765-2021 ONLY COVERS SFR HOMES, NOT ADUs, OUTBUILDINGS, AND GARAGES
* What about the reporting format, what is contained in it? PARTITIONED ABOVE, BELOW, FINISHED AND UNFINISHED AREA STATED IN A DECLARATION (FOUND IN ANSI STANDARDS).