If you are a real estate agent, appraiser, or someone working toward becoming an appraiser, you’ve probably come across the term ANSI measuring standard. This refers to the American National Standards Institute (ANSI) Z765 standard.
The central pieces of the NASI Standard have to do with:
- Finished and unfinished areas
- Room dimensions
- Above-grade and below-grade areas
- Exterior measurements
Let’s look at this standard in more detail, why it’s important, and what appraisers need to know.
Learn the best home measurement practices in our online appraisal course, “Residential Property Measurement and ANSI Z765.”
What is the ANSI Z765 Standard?
ANSI Z765 is a standardized method for measuring single-family homes. Its full publication title is Square Footage – Method for Calculating: ANSI Z765-2021. It is the only nationwide standard for measuring properties that has been adopted by state appraisal regulatory agencies, Fannie Mae, and Freddie Mac.
Appraisers should note that ANSI Z765 applies only to single-unit (single-family) detached and attached residences, not to 2–4-unit properties or apartment-style condominium or co-op units.
Also, appraisers must apply ANSI Z765 in its entirety and cannot pick and choose which part or parts of the standard to use.
Here are some of the specific details of the ANSI Standard regarding square footage:
- The Basement is any space partially or completely below grade
- Finished areas must have a 7′ ceiling height or higher. In rooms with a sloping ceiling, no less than 50% of the finished square footage of the room needs a ceiling height of at least 7′ and none of the finished area with a ceiling height of under 5′ can be included in the GLA
- Measurements are taken to the nearest inch or tenth of a foot, and the final square footage is reported to the nearest whole square foot
- Staircases are included in the GLA of the floor from which they descend
- If a house has a finished area without a ceiling height of 7′ for 50% of the finished area, appraisers can put this area on a separate line in the Sales Comparison Grid with the appropriate market adjustment. The report will be in compliance with ANSI and acknowledged the contributing value of the non-GLA square footage.
Why is the ANSI measuring standard necessary?
For many years, supervising appraisers taught trainees to measure houses, and methods varied significantly among individuals and locales. Unfortunately, a lack of uniform standards for measurement and calculation resulted in inconsistencies within the profession.
Enter the adoption of ANSI Z765, which provides a reliable, defensible, and repeatable method for measuring single-family homes. With the rise of various new technologies and apps used to measure homes, calculate GLA (gross living area), and generate floor plans, the consistency provided by the ANSI measuring standard is more important than ever.1
Adoption of the ANSI measuring standard
Originally adopted by the American National Standards Institute (ANSI) in 1996, the ANSI measuring standard was optional for appraisers for over 25 years. Then in April 2022, Fannie Mae adopted ANSI Z765, making it mandatory for appraisers when valuing properties for loans to be purchased by them. Freddie Mac followed suit in November 2023.
Today, Fannie, Freddie, and a small number of state appraisal regulatory agencies require appraisers to use the ANSI Z765 measuring standard for measuring one-unit detached and attached dwellings.
FAQs about ANSI Z765
Now, let’s address some frequently asked questions about the ANSI measuring standard.
How does the ANSI Standard help the appraisal industry?
The ANSI Standard create alignment among appraisers. It also does the following:
- Helps to make sure home valuations are based on an objective standard
- Keeps human error caused by hand-drawn sketches and notes out of the system
- Allows for a clear and repeatable process for GLA reports
- Reduces the risk of litigation caused by inaccurate or inconsistent measurements
- Reduces the need for remeasuring and recalculating the square footage
- Increases the confidence level of those who rely on appraisals (realtors, developers, brokers, banks, etc.)
In short, the accurate measurement of property is vital for proper real estate transactions, and ANSI is positioned to do just this.
How can I get a copy of ANSI Z765?
ANSI Z765 is a copyrighted document. A downloadable PDF is available for purchase for $25.00 from Home Innovation Research Labs.
What’s the most current version of the ANSI Z765 publication?
The American National Standards Institute (ANSI) revised its Z765 Standard early in 2021; previous versions of this standard should not be used.
Where can I find further guidance for applying the ANSI measuring standard?
We recommend that all appraisers take our ANSI training course, which provides comprehensive instruction and real-life examples and is available in livestream and online formats. For a quick reference, Freddie Mac1 and Fannie Mae2 have information available on their websites.
Learn more about ANSI Z765 with McKissock
For appraisers who want to learn more about ANSI Z765 and other best practices for measuring residential dwellings, McKissock offers a 4-hour livestream course titled “Measuring 1-4 Unit Residential Properties – with ANSI Z765 Standard” and a 4-hour self-paced online course titled “Residential Property Measurement and ANSI Z765.”
Get 24/7 access to the ANSI Z765 training course and hundreds of other appraisal CE courses—all for one affordable price—when you become an Unlimited Learning Member.
Resources:
- American National Standards Institute (ANSI) FAQ. (FreddieMac.com)
- Standardizing Property Measuring Guidelines (Fannie Mae.com)
Editor’s note: This post was originally published on July 6, 2023 and updated in March 2024.
