News flash! As of April 1, 2022, The Federal National Mortgage Association (Fannie Mae) now requires that appraisals on certain properties must comply with a specific American National Standards Institute (ANSI) measuring standard. If you are an appraiser – or someone who works with appraisers – you need to understand what this change means and how you can ensure compliance. Below, we provide a question-and-answer overview of the basics you need to know.
A. American National Standard for Information Sciences — Square Footage — Method for Calculating, ANSI, Z765-2021.
A. This standard, which has been in use since April 1996, addresses the need for uniformity in measuring, calculating and reporting square footage (area) measurements of dwellings in the United States. In fact, you may already be familiar with it. Many appraisers have voluntarily adopted the ANSI standard since it was first launched, and some states require appraisers to adhere to it. Also, the ANSI standard is currently used by the National Association of Home Builders.
A. Historically, Fannie Mae has not required the use of a specific measurement standard. As a result, appraisers would use a variety of measuring methods that produced inconsistent results. Now Fannie Mae’s position on measurements has changed, with adoption of the ANSI Z765-2021 measuring standard.
A. Valuations of residential properties correlate strongly with square-footage measurements. Therefore, adoption of the ANSI Z765-2021 standard will ensure that all spaces within appraised homes are measured the same way, with little room for interpretation.
A. The newly adopted standard will:
A. It applies to residential properties only, as described here:
A. It means residential-property appraisers now need to use tools and methods that ensure proper measurements, as outlined in the ANSI Z765-2021 Measuring Standard. For example, the standard specifies that all footprint sketches and floor plans must:
A. Here are some additional items appraisers must consider when using the standard as a guide:
A. The answer is “yes” for any appraisers who still create hand-drawn sketches for their reports. Fortunately, though, mobile software that creates computer-generated floor plans and sketches for appraisal reports is readily available. In fact, Fannie Mae reports that one key factor in its decision to adopt the ANSI standard now “is the recent emergence of new technologies, such as phone apps, which can measure houses, generate floor plans, and calculate GLA.”
A. Accuracy is key to meeting Fannie Mae’s newly adopted standard for measurements. So, if you are an appraiser, here’s what you need: a mobile-device floor plan app that can be paired with a Bluetooth laser distance meter to produce sketches with measurements that are 100% accurate.
A. If you’re a professional who works with appraisers, demand nothing less than highly accurate measurements. Make sure your appraisers use a mobile floor plan app that can be paired with a Bluetooth laser distance meter to produces sketches with measurements that are 100% accurate.
A. If you want to read more about this important change, you can download the Fannie Mae Guidelines for Measuring Gross Living Area. Also, you can contact Fannie Mae to ask specific questions about appraisal or inspection topics.
Appraisal methods for residential property measurements were inconsistent for a long time. But that’s no longer the case. Fannie Mae’s recent adoption of a uniform measurement standard for square footage ensures consistency across the board. And that’s good news for all parties involved with residential real-estate sales.
If you are interested in learning how to measure and create a floor plan more accurately, read our 10 Reasons Why You Should Be Creating Digital Sketches On-site.
Or if you're looking for additionally accuracy, here is our comparison of the 3 best laser measuring tools for a budget.
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