Stairway to Confusion – What is Included in GLA?
by C. Brett Bowen
Excerpt: There has been considerable discussion over the years about gross living area (GLA) measurement standards. The ANSI Z765 standard gets the lion’s share of the attention, and is the most widely referenced standard in the industry by far. It can also be the most difficult to interpret, particularly when it comes to stairs. Here’s why.
It is primarily important to recognize two very important facts:
1) a standard is nothing more than the definition of a unit of comparison
2) it is the appraiser’s responsibility to be consistent with that definition.
First, what do I mean when I say that a standard is nothing more than the definition of the unit of comparison? The unit of comparison for something is critical to the understanding of that thing.
Second, as an appraiser, consistency with the definition is actually more important than which definition is chosen.
To read more, click here
My comment: Worth reading. I have seldom used ANSI. The standards were developed for new home construction. I have appraised many homes on hillsides, with often only the garage at street level (or just a driveway). Many historic homes, on level streets, have different types of “basements” converted to living area: above grade, partly below grade, etc. If I worked in suburbia, ANSI would work better. I use what the local market tells me.
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To read more of this long blog post with many topics, click Read More Below!!
NOTE: Please scroll down to read the other topics in this long blog post on unusual homes, mortgage origination stats, sfr zoning, german appraisers, GLA, etc.
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One of the Skinniest Homes in London
Excerpts: Sure, big, expansive homes are great. But there’s something about slim (and storied) spaces that charms the real estate geeks among us. I, for one, am hooked the minute I start scrolling through a listing and wonder, “How on earth would you fit furniture in there?”
Two full bedrooms and two full bathrooms and 580 square feet. Six feet across at its narrowest and the main bedroom that’s almost 11 feet wide.
To read more and see the fotos, click here
My comment: One of these skinny homes is in my city. I saw it inside many years ago and drive by it frequently. I have been fascinated with them since then ;>
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Lessons from German Appraisers (22-minute Video)
Excerpt: What can U.S. and German appraisers can learn from each other? The speaker is Reiner Lux, General Manager of HypZert GmbH and Mattias Fischer, Manager of Valuation for VDP
What exactly are appraisers seeing in the current market? How does our appraisal process differ from Germany? What can we learn from German appraisers in this market during the pandemic? These questions and much more are answered.
To listen to the video more, click here
My comment: One of the most fascinating appraisal books I have read is Real Estate Valuation in Global Markets, second edition, published in 2011 by the Appraisal Institute. I reviewed it in 2011. Data availability varied widely, with some countries having no public records. Appraiser requirements also varied. This book gives you a good perspective on how we compare with other countries. Price: $30.00 AI member Price: $24.00. Google the title to purchase the book.
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5 A-Frame Homes For Sale from $149,000 to $1,100,000
Excerpt: Lots of natural light from windows along the front and back. They’re often found in Alpine settings, because they’re built for keeping snow off the roof. But they also work well in other places, like the forest or even the beach. Although they’re usually small, their tall roofs give them an airy, spacious feel.
3777 Evergreen Pkwy, Evergreen, CO (PHOTO ABOVE)
Price: $1,100,000
over 1 acre with 3,300 sq.ft. four bedrooms and three bathrooms.
303 Oak St, Norton, OH
Price: $149,900
On a double lot, two-bedroom home built 1975 “could use some TLC.” But for a modest price, surely there’s room in the budget to
To read more and see photos (click on address for more), click here
My comment: I have not appraised an A-Frame for many years. Could be challenging if there are few sales nearby!
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Angry Borrower Calls
What to Do?
- Threatened with a Lawsuit? By Claudia Gaglione, Esq.
- The Angry Property Owner By Ryan Reynolds
- How to handle angry borrowers and agents by Dustin Harris
Lots of practical advice and examples of what to do. This is the best practical information I have seen from an attorney and two practicing appraisers. You cannot discuss value, of course. The first two articles are in the October issue and Dustin’s is in November issue.
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10 U.S. Cities With the Most Affordable Mansions for under $1 million
Excerpts: The most affordable mansions were in the Midwest and South, where real estate is generally cheaper. Many are found in areas like the Rust Belt, former industrial powerhouses that have been struggling economically in recent years. But the stately homes of local titans, built to show off their wealth, still stand—and some of them can be found for a bargain.
1. Indianapolis IN (PHOTO ABOVE)
Median mansion price (5,000-plus square feet): $845,000
Median mansion price per square foot: $137
The capital of Indiana was once a hotbed for transportation industry bigwigs, natural gas–moneyed families, pharmaceutical pioneer Eli Lilly, and Madam C.J. Walker, the first woman to become a self-made millionaire in America. With all those wealthy residents, there were plenty of spacious homes built to accommodate their stature.
To read more, click here
My comment: Very interesting. In my city, $845,000 is a small, architecturally uninteresting major fixer-upper in a bad location. I was born in Tulsa, OK. Did not know there were cheap mansions there. Oil magnates from the past maybe. Don’t see any cheap mansions in the West or Northeast.
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Goodbye single-family zoning
By Ryan Lundquist
Excerpts: Goodbye single-family zoning. If you didn’t know, two weeks ago, SB9 was signed into law in California, which now allows property owners to build a duplex on any residential lot or subdivide to build up to four units. This is massive news…
Minneapolis as a case study: In 2019 Minneapolis legalized triplexes to be built on single family lots and Axios points out there was little change. In fact, there were only 70 units added in 2020 (20 brand new units and 50 single family units converted to multi-units). Oregon has also banned single family zoning in most cities, so let’s keep an eye on Oregon too…
In closing, this change in zoning is certainly unconventional and even scary to many, but the impact is still to be determined. My advice? Let’s be objective about the issues, listen, embrace facts, and avoid sensationalism.
To read more, plus lots of appraiser comments, click here
My comments: Good, understandable, and reasonable analysis with some good links. This is happening in some cities around the country due to the housing shortage. The biggest complaint I hear is that people don’t want more housing because more on-street parking spaces are taken. Residential appraisers may not be qualified for highest and best use analysis if more than 4 units can be built.
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5 A-Frame Homes For Sale from $149,000 to $1,100,000
Excerpt: Lots of natural light from windows along the front and back. They’re often found in Alpine settings, because they’re built for keeping snow off the roof. But they also work well in other places, like the forest or even the beach. Although they’re usually small, their tall roofs give them an airy, spacious feel.
3777 Evergreen Pkwy, Evergreen, CO (PHOTO ABOVE)
Price: $1,100,000
over 1 acre with 3,300 sq.ft. four bedrooms and three bathrooms.
303 Oak St, Norton, OH
Price: $149,900
On a double lot, two-bedroom home built 1975 “could use some TLC.” But for a modest price, surely there’s room in the budget to
To read more and see photos (click on address for more), click here
My comment: I have not appraised an A-Frame for many years. Could be challenging if there are few sales nearby!
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HOW TO USE THE NUMBERS BELOW. Appraisals are ordered after the loan application. These numbers tell you the future for the next few weeks. For more information on how they are compiled, go to www.mbaa.org
Note: I publish a graph of this data every month in my paid monthly newsletter, Appraisal Today. I have been following this data since 1993. For more information or get a FREE sample issue go to https://www.appraisaltoday.com/products.htm or send an email to info@appraisaltoday.com . Or call 800-839-0227, MTW 7 AM to noon, Pacific time.
Mortgage applications decreased 6.9 percent from one week earlier
WASHINGTON, D.C. (October 6, 2021) – Mortgage applications decreased 6.9 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending October 1, 2021.
The Market Composite Index, a measure of mortgage loan application volume, decreased 6.9 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 7 percent compared with the previous week. The Refinance Index decreased 10 percent from the previous week and was 16 percent lower than the same week one year ago. The seasonally adjusted Purchase Index decreased 2 percent from one week earlier. The unadjusted Purchase Index decreased 2 percent compared with the previous week and was 13 percent lower than the same week one year ago.
“Mortgage applications to refinance dropped almost 10 percent last week to the lowest level in three months, as the 30-year fixed rate increased to 3.14 percent – the highest since July. Higher rates are reducing borrowers’ incentive to refinance, as declines were seen across all loan types,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Purchase activity also fell, driven by a drop in conventional loan applications. Government purchase applications were up over 1 percent, but that was still not enough to bring down the average loan balance of $410,000. With home-price appreciation and sales prices remaining very elevated, applications for higher balance, conventional loans still dominate the mix of activity.”
The refinance share of mortgage activity decreased to 64.5 percent of total applications from 66.4 percent the previous week. The adjustable-rate mortgage (ARM) share of activity remained unchanged at 3.4 percent of total applications.
The FHA share of total applications increased to 10.5 percent from 10.4 percent the week prior. The VA share of total applications increased to 10.3 percent from 10.2 percent the week prior. The USDA share of total applications increased to 0.5 percent from 0.4 percent the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($548,250 or less) increased to 3.14 percent from 3.10 percent, with points increasing to 0.35 from 0.34 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate increased from last week.
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $548,250) increased to 3.20 percent from 3.14 percent, with points decreasing to 0.27 from 0.33 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 3.12 percent from 3.09 percent, with points increasing to 0.31 from 0.25 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
The average contract interest rate for 15-year fixed-rate mortgages increased to 2.45 percent from 2.43 percent, with points decreasing to 0.24 from 0.29 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
The average contract interest rate for 5/1 ARMs decreased to 2.54 percent from 2.77 percent, with points remaining unchanged at 0.16 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
The survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts. Base period and value for all indexes is March 16, 1990=100.
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Ann O’Rourke, MAI, SRA, MBAAppraiser and Publisher Appraisal Today
1826 Clement Ave. Suite 203 Alameda, CA 94501
Phone 510-865-8041
Email ann@appraisaltoday.com
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