Appraisers are often tasked with providing valuations for properties that can be very different from one another. From one house to the next, things can and often do change. Everything from the number of bedrooms to the quality of the construction. However, in order to provide credible valuations, appraisers often have to find an objective basis for comparison. More often than not, square footage and size become the units of comparison.
However, simple square footage counts are not used. Appraisers use a unit of comparison known as the GLA, which stands for Gross Living Area. The Gross Living Area is used as a standard measure for the size of a dwelling. It is used in real estate appraisals to determine the value of a property. To calculate GLA, the square footage of all floors of the dwelling is measured and included, excluding basements and unfinished attics. The GLA measurement is used to compare properties and to determine the value of a property based on its size. It is important to accurately measure the GLA of a property, as it can significantly affect the value of the property.
The gross living area is typically defined as the finished and heated space in a residential building that is easily accessible and meets certain requirements for heating and ceiling height. These requirements vary depending on local building codes and regulations but typically include a traditional heating system and a minimum ceiling height of 7 feet. This is because construction rules frequently require at least a 7-foot ceiling height for spaces to be considered usable and livable. This is due to the fact that low ceilings can make a place feel tight and uncomfortable, as well as pose a safety hazard if they are too low for people to stand upright in.
Determining the gross living area (GLA) of a property can be a crucial factor in its evaluation and, ultimately, its value. There are several sources that can be used to determine the GLA of a property, such as public records, assessors, and plans or specifications. However, these sources may not always provide an accurate representation of the property’s true GLA for a variety of reasons. One reason is that the information contained in these sources may be out of date or inaccurate. For example, public records may not reflect any renovations or additions that have been made to the property since the records were created. Similarly, assessors may not have access to the most up-to-date information about the property.
Additionally, other sources, such as plans, or specifications, may not always be complete or detailed enough to accurately reflect the property’s true GLA. Public records often do not include information about finished basements or bonus rooms that are part of the GLA, and plans or specifications may not include all of the details needed to accurately measure the spaces. Overall, it is important to verify the accuracy of any information about a property’s GLA, and to use multiple sources of information, if possible, to get a complete and accurate picture of the property’s true GLA. This is where a professional appraisal inspector comes in.
In most cases, the process of obtaining the GLA requires appraisers to inspect and measure a subject property. This is done through a thorough and meticulous process, where the inspector will use specialized tools and techniques to measure every room, hallway, and other living space within the property. These inspections and measurements must conform to the standards and guidelines of the American National Standards Institute, also known as ANSI. ANSI guidelines, specifically, the Square Footage-Method (ANSI Z765-2021), provide appraisers with a standard for measuring, calculating, and reporting above and below-grade square footage(s) to determine the gross living area (GLA) and non-GLA areas of subject properties. This creates alignment across market participants, allows transparent and repeatable results for the user of the appraisal report, and provides a professional and defensible method for the appraiser. ANSI guidelines also provide standards for the design and construction of supplementary units installed in a single-family home, such as an in-law/accessory unit or finished attic spaces. A small, independent living area constructed on the same property as a single-family home is referred to as an accessory unit. It is also known as a secondary unit or in-law unit. Usually smaller than the main house, accessory units serve a variety of functions, such as giving family members or tenants extra living space.
An in-law unit is a separate living space that is typically located on the same property as a single-family home. In-law units can be used for a variety of purposes, such as providing a place for an aging parent or adult child to live, or as a rental property. In many cases, an in-law unit is not considered part of the gross living area (GLA) of a home because it is a separate, self-contained living space. The GLA of a home generally refers to the total square footage of all of the habitable and livable space within a home, including the main living areas, bedrooms, and bathrooms. Because an in-law unit is a separate space with its own kitchen, bathroom, and living areas, it is often considered a separate entity from the main home and is not included in the GLA calculation. The appraiser would take these factors into consideration when determining the value of the in-law unit, and this value would be reflected in the overall appraisal of the property.
These considerations and issues are important and necessary for the appraiser to verify. As stated above, it is during the physical inspection of the property that the appraiser collects the information needed to determine GLA. But a physical inspection also allows the appraiser to gather other detailed information about the property, such as its condition. This is important because the value of a property can be significantly affected by its condition, age, and features. By inspecting the property in person, the appraiser can see firsthand any issues or problems that may affect the value of the property.
Second, a physical inspection allows the appraiser to verify the accuracy of the information that has been provided about the property. For example, if the property is described as having a certain number of bedrooms, bathrooms, and square footage, the appraiser can verify this information by measuring the rooms and taking other physical measurements of the property. This helps to ensure that the appraisal is based on accurate and reliable information.
Finally, a physical inspection allows the appraiser to get a better understanding of the property’s location and surroundings. The appraiser can assess the quality of the neighborhood, the proximity of amenities and public transportation, and other factors that may affect the value of the property.
Conversely, it should be noted that while all appraisers follow the same guidelines and standards when inspecting a property (such as ANSI) and determining GLA square footage, the same is not true for assessors or real estate agents. Information about in-law units is typically not properly disclosed in public records and leads to discrepancies. Real estate agents may not be following the same guidelines when measuring finished areas in basements or attics. Appraisers and appraisals, however, have physical inspections and ANSI standards that are used to verify what is being reported.