Calculating gross living area
The calculation and definition of gross living area (GLA) are significant parts of an appraisal. Public records about a property often have this data, but taking the measurements at the property ensures the valuation is completed with accurate figures, as a home may have had renovations or other changes, which make the information from public records suspect.
Calculating GLA means more than going to a house and measuring a few outside walls. There are guidelines that determine which parts of a home count toward square footage in an appraisal report.
Accurate measurements for GLA are not important solely for the purpose of giving homebuyers the right information. Government-sponsored enterprises Fannie Mae and Freddie Mac also require GLA figures in appraisal reports. This ensures valuation professionals give a uniform view of a home's size, which is important for for the appraisal quality review process.
"Gross living area's requirement for a finished room has certain criteria."
What GLA encompasses
The key word is "living." When calculating GLA, each space must be considered a living area. This definition includes bedrooms, bathrooms, kitchens, dining rooms and living rooms, per guidelines laid out by the American National Standard Institute (ANSI).
Another key requirement is spaces must be finished with heating and ventilation, meaning decks and garages don't count toward GLA. The exception here is for covered porches with heating and finished garages that have been converted into living space—homeowners must have obtained the appropriate permits for these projects.
ANSI requires rooms be above-grade. For instance, a finished basement isn't factored into GLA because it is below the landline or grade. Even if the basement is a partial walkout and includes bedrooms and a kitchen, these areas aren't considered. If a room is partially above grade, appraisers shouldn't note it for the GLA. It should be noted that the appraiser should recognize the contributory value of a finished area below grade; it just is not included in GLA.
What 'finished' means
GLA's requirement for a finished room has certain criteria as well. In particular, areas must be finished to a similar standard as the rest of the house and include the same heating and cooling system. In essence, this means a room must be usable throughout the year regardless of weather conditions.
This is particularly important for sunrooms and similar covered spaces. Certain appraisers, homeowners and even real estate agents aren't sure whether these areas are part of GLA. If a sunroom or heated porch was built when the house was originally constructed, it's likely the space has the same heating and cooling system as the rest of the property. However, renovated areas or additions may not be of GLA due to the lack of a foundation. Similar to below-grade rooms, this space is given value in part of the appraisal other than GLA.
GLA and attic space
Though some homeowners don't use their attics as living space, appraisers can factor these sections into GLA. A requirement is that attic ceilings have a height of at least 5 feet. So in an A-frame home, GLA includes the rectangular cutout of the attic space that would otherwise constitute a room with a minimum of 5 foot high side walls.
GLA and bedroom number
Appraisal reports also note how many bedrooms are in a house, and the rules for what counts don't completely align with GLA requirements. First, a bedroom must be of a reasonable size to be included in the report. This criteria also requires the room have a closet and window.Often, the appraiser will refer to available U.S. Department of Housing and Urban Development guidelines for minimum bedroom size.
GLA and GBA
Gross building area (GBA) serves a similar purpose as GLA, but the two aren't the same. Both include only finished areas, but GBA reflects finished living areas whether above or below grade.