If you didn’t know, Fannie Mae is adopting some changes with the way appraisers measure square footage (pdf). In short, as of April 1, 2022, appraisers are going to be required to measure square footage per ANSI standards (American National Standards Institute). The idea is to standardize the way things are measured to help increase uniformity in appraisal reports. In my mind, this isn’t poised to revolutionize the way appraisers report square footage, but there will be some fine-tuning. Keep in mind this does not apply to private appraisals for tax purposes, divorce, etc.
NOTE: It is not certain if FHA and VA will adopt ANSI.
Some things to know about ANSI:
- Appraisers will now be required to round to the nearest tenth of a foot (basically, the nearest inch).
- Below-grade area doesn’t count in the square footage (but it can count in the value).
- There will be more of an emphasis on “below grade” instead of “basement.
- At least 50% of the ceiling height needs to be seven feet or above to count in the square footage (it can still count in the value as non-square footage if it’s below seven feet).
- Area below five feet doesn’t count in the square footage
- Stairs count for square footage for the level from which they descend.
- The space below stairs also counts in the square footage. I completely get this if there is a closet with accessible space, but it seems illogical to me to count the space below if there isn’t any access. In my mind this can inflate the square footage by 30 square feet or so.
Keep in mind builders and public records may not use ANSI measuring standards, so it’s possible we can see more minor discrepancies between the square footage in appraisal reports and public records.
*Information provided by Ryan Lundquist, a Sacramento area appraiser that writes a weekly blog: https://sacramentoappraisalblog.com/