How to Have a Garage Count as Living Space for an Appraisal

A converted garage can be counted as interior living space, but only under certain conditions.

A converted garage can be counted as interior living space, but only under certain conditions.

A home appraisal must follow certain rules in terms of what does and doesn't count as living space. Normally, a garage would not be considered living space, but what if a homeowner has converted the garage into a living area? While such a conversion might increase the value of the home at sale time if a potential buyer appreciates the added room, there are also risks: first, that the loss of the garage might also subtract from the home's value to potential buyers; and second, that the appraisal rules might not value the space as much as the homeowner expects.

Ensure that the garage was converted to a living space that matches the standard set by the rest of the house. That means checking that the quality of the workmanship is up to the standard of the rest of the dwelling, and the conversion was done with all the right permits and zoning approvals. In addition, the space must be "conditioned," meaning it has an equivalent heating and cooling system to the rest of the house.

Check that the garage conversion meets all building codes for a living space, including the proper doors, egress windows or other "finishing" work. This may include the installation of flooring and drywall, or insulating walls or ceiling, among other mandates, as well as meeting space minimums for height and area.

Determine if the garage room is above or below the grade of the property. The rules laid out by Fannie Mae, a major government home loan organization, distinguish above-grade space from below-grade space. If the garage is below grade, it may not be valued as highly on an appraisal. This could be an issue if a house is built on a hill and the garage is set "into" the hill, for instance, so the converted room ends up below the grade of the property.

Bring in an appraiser to re-evaluate your home with the added space. The appraiser likely will follow both Fannie Mae's guidelines for gross living area, as well as the American National Standards Institute standards, and increase the total amount of living space in the home to include the conversion so long as it meets all of the requirements.


About the Author

Eric Strauss spent 12 years as a newspaper copy editor, eventually serving as a deputy business editor at "The Star-Ledger" in New Jersey before transitioning into academic communications. His byline has appeared in several newspapers and websites. Strauss holds a B.A. in creative writing/professional writing and recently earned an M.A. in English literature.

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