Can a finished attic be included in the appraisal of a home?

I was asked a great question by an agent this week that I thought I would share with you. Before we get into that though I would like to let you know that I am available to answer any appraisal related questions you may have. I can be called, emailed, or you can even text me. If I don’t know the answer right away I will find it and get back with you. I might even write a blog post about it, because I know that if one person has a question then others may too.

So the question that the agent asked was this, “If an older home has permanent stairs to attic space that’s been finished with good headroom that includes a bedroom/closet/bathroom, do you include the square footage in your appraisal of the home”? The criteria for what can and cannot be included in the finished area total is set forth by the American National Standards Institute through what is known as the ANSI Standard. There are several criteria that must be met in order for this area to be included. The first criteria is that at least half of the finished square footage must be 7 feet where the ceiling slopes and those areas less than 5 feet are not counted in the finished area. Here’s a picture to help you understand it.attic floor height requirement

These are the rules for how the area is calculated, however the quality of finish is also studied. The quality of finish should be similar to the rest of the house so that the area is functionally usable in addition to being heated and cooled. Homeowners sometimes like to do the work themselves in order to save money and if they have the skills to pull this off so that the addition is similar to the rest of the home this works out fine, however if they lack the knowledge it could have a negative impact on the property and the additional area may not get counted as much, if it is counted at all.

The last thing I would like to discuss is the topic of permitting. Appraisers are not required to check whether an addition is legally permitted unless the client specifically ask’s for it, however we are required to include pictures of every room. If there are signs in these pictures that the addition has inferior quality of construction or workmanship then they may ask us to verify if it was permitted. If it was not permitted this could result in a loan not being made, so it is important that proper permits be obtained. Have you had any experience with a similar situation? What was it and how did it turn out? Would you have any other questions I might be able to answer?

If you have any real estate appraisal related questions you can call me at 205.243.9304, email me, or connect with me on Facebook., Twitter, or Youtube.


  1. We are going to be building our house soon. My husband is going to be doing all the work and we are trying to do it with as few loans as possible. The attic floor will be full height but we are planning to leave it unfinished for now. We can’t afford the property taxes when its finished while we pay off what we need for the main floor. Eventually we hope to add a few bathrooms and bedrooms on that floor. He will plan to get what he needs to up to that level so he can hook in plumbing. Floors will be in floor heating, so that won’t matter until it’s finished someday. My question is, can we get the permit for the whole house including what we plan to do with the top floor? Even though it will be unfinished when we get our certificate of occupancy when the rest is done? Or do we need to just submit our plans with “unfinished” for the whole attic floor. Will our property taxes be properly assessed if our plans are permitted for the top floor but we have it unfinished at the time of assessment? Should we request them to come in for the assessment to see that its unfinished so we aren’t paying property taxes on it for all the years we may keep it unfinished? Thanks so much

    • Jess, I am not an expert in municipal property assessment so keep that in mind. My only concern with submitting the plans for the home being completely finished including the attic is that they would start assessing it as finished and then it would be hard to change. I think I would submit it with the attic being unfinished so there is no confusion. I guess you could follow up with the assessor when it is finished and the CO is issued but I think it could still slip past them and they would assess it higher. You can always get a new building permit when you are ready to do that work.

    • Heather U says

      @Jess B, we are planning the same thing and our attic space will become our son’s bedroom with bathroom included on that floor within two years, but we don’t want it assessed with that space for tax reasons, we only want a two bedroom house assessment. How did it go with you?

  2. I have a walk out basement that was used as garage space with a garage door by the previous owner. It has existing water and electrical. There is a staircase inside the home to the basement. We have put in a floor, ceiling, and finished the drywall. The space has been tied into the HVAC. We have taken one of the existing rooms and made it into a kitchen and another into a bedroom. There is an existing full bath. The bedroom has large windows with a door to the exterior. The largest room has windows with a garage door. My question is that to make this living space does the garage door need to be replaced with regular doors or can a decorative garage door be put in?

    • There is no rule that says that the door cannot be a garage door. As long as it meets the other requirements, which it appears that it does from your description, it should be fine. Of course, this would be considered below-grade basement area and should not be combined with above grade area when quoting the property’s gross living area.

  3. Amanda Benatar says

    Great info. I live in an area that rarely has full attics and it was a great refresher. Much appreicated

  4. Lorie A Barton says

    I recently had an appraisal and there is a game room above the garage that is heated and cooled with the rest of the house. It is all attached and under same roof on the same slab and connected. It is all on one HVAC unit. You do not go outside nor leave the house to access the stairs. You through a hallway to a door that leads to the garage, then Go through garage to another door that leads to stair way. The appraiser did not include the Game room as GLA even though it is heated and cooled with main house unit. Is it possible for the game room to be considered GLA since it is heated and cooled off same unit.? If NOT, since the garage is over sized and that end is already considered an open hallway, could I simply put a wall or petition up and make that end of the garage a hallway? would the game room then be considered GLA.?

    • From your description, it sounds like you go through the garage to get to the room. If this is the case, that is the reason the appraiser did not include it. The guidelines state that you must not go through unfinished areas so if you finished off a hallway to the stairs leading to the room over the garage it should be okay.

      • Jennifer says

        Hi Tom,

        We are looking to purchase a home that has finished stairs up to an attic space above the garage. The stairs are accessed from a mud room as part of the main house. I’ll be interested to see if the 7ft measurement would be for this space – it will be close. My question is the rest of the house is on two HVAC u it’s and this space has a not so attractive hotel like ac/heater in it that sticks out the side of the home I believe really devalues it. (This is an upscale home in a nice neighborhood.) is that taken into account during appraisal/sq footage counting?

        • The appraiser will most likely take into consideration the quality of the finished attic space, including the lower ceiling height as well as the different types of HVAC systems. The difference in quality may affect its contributory value compared to the rest of the house. The lower quality HVAC and potential negative market reaction to the way it looks could also impact the value.

  5. Hello Tom,

    We bought a home in August 2019, with the attic partially finished in terms of easy access from hallway, electrical heating and hardwood floor. It was not included previously in property value for tax purpose, but the town regards it as a living area now and added $30 K of property value this year. Whether I can argue with town that the attic has no cooling conditions and is not safe to live when the summer here is very hot; the electric heating is too expensive to use in winter. We use central AC and gas heating for home.

    Because the attic is regarded as the living space, the home assessment is 20K more than what I bought 4 months ago. Can I argue with the town that their assessment does not make sense when it is significantly higher than the marketing value.

    Thank you very much!

    • I would definitely try, Mark. You might want to find out from them what their definition of living space is. I would tell them everything you have told me and if you have a recent appraisal that reflects the current condition of the property and shows that the appraiser did not consider it then I would show that to them as well. Sometimes the county tax assessor may have incorrect information that can be corrected and lower your taxes. Good luck.

  6. Susan Denney says

    As an appraiser, I measured a home that a Realtor had also measured. We are 150sf off and I measured by ANSI. My question is in the bonus room. I know the 5″ rule but do you add to that for outside walls? Never have but maybe I am doing this wrong. Thanks

    • I assume this bonus room is the second level? Whenever I measure the second level from the inside I always add for the outside walls. This may be the difference between the two.

  7. Hi Tom,

    Great post and very useful reference diagram.

    I have a followup question to the “7 ft for more than 50% of the area above 5 ft rule.” Example: The bedroom in the finished attic has 7 ft ceiling and is ~220 square feet. The closet adjoining the room has a 7 ft tall ceiling center that dives down to 5 ft tall walls. So just 1 inch of the 6 ft wide closet is 7 ft tall. Does the area in the closet count as finished square footage?

    Thank you for your insight.

  8. Michelle Raybon says

    Hello Tom,
    Thank you for taking the time to share and give direction. This is a question of building codes vs assessed codes vs health dept codes regarding living space. I had a small old 1 story home on a crawl with a galley kitchen ajacent to a Sunporch which collapsed due to roof of home structural failure. I applied the 25k Insurance money to utilizing the existing footprint for a full size kitchen bath and utility area for washer and dryer. I decided to add a 4ft half wall and scissor trusses for an Unspecified second floor space as I have no basement or garage and lost my sunporch. I esvavated a bit of space to run new plumbing and had a new electrical service run from the pole to a new box. The twp gave me certificate of occupancy on all that I call Phase 1. I then pulled a permit to gut remaining 1st floor of original home. This exposed a 12×12 area where I had no floor joists in original plan because I thought a loft with a railing would be a nice open concept. When the inspector came for the rough inspection, my nightmare began. He reported me to the health dept for a septic field evaluation. I assured the health dept that I had no intention of adding rooms closets or bath and the only otjer variable was the assessment. If that went up 50 percent then the Septic requires evaluation via perk test. I called the assessors office and they said if the space is heated then yes my assessment would likely trigger the health dept. I negotiated with the inspector to close it in with a staircase to a door that qualifies for exterior and not heat it. He approved for me to go to finish stage by calling it unfinished attic. I was spotted adding drywall to cover attic insulation during the phase 2 finish process and ticketed for renovations not in permit. Going to court Tuesday and the inspector wants to force me to finish it as living space. This sounds crazy but he said he would take it over and finish it and charge my tax bill. Sound cazy? Im terrified of the financial burden of potential septic rework and need to prove that theres a building code similar to assessors code that allows a partially finished attic space to used as storage. Additionally I have a child that comes home from college and entertains friends up there and has also been spotted reinforcing the inspectors position. I know theres a code called Section 312 class U for Utility or unspecified use in an out bldg. Do you know if theres a code for a step up from storage in an attic that is still not the living space qualification? Can he not give me a CofO if he sees us using the space other than storage? Additionally he has Expired my permit and wont extend it. I dont even know what that means. He said the judge will decide. Im trying to give the judge codes the inspector may be unwilling to apply for permit purposes.

  9. Rich Wrede says

    Tom, I finished my attic some time ago. A friend of mine and I insulated the area, then built side walls to each side with storage. The attic stair case brings you into the space and then in the middle we built a door dividing the space into two rooms. We added electric to power the heat and air units. We recently placed the house up for sale and we told by our real estate agent and others that the space would not be counted. A buyer stepped forward and a contract has been framed. The buyer has requested that the attic space be certified/reviewed for past due assessment fees, if any, be paid.

    I called the town and they say that unless we have an opened permit they will not come and assess the work. They told me to contact the fire department for their safety check. Have you heard of a town collecting past due assessments for space not previously accounted for? Who do you suggest I contact to address this situation and allow us to move forward. Thanks Mr. R

    • I have not heard of this myself. It sounds like they want to collect past due taxes? I would find out what the policy of the lender is to see what their requirements are. I am sure the lender wants to make sure that the attic area passes all building code so that it can be insured. In order to do this you might have to get the approval of the tax assessor by paying past due taxes.

  10. I have a question… My house has considerable unfinished attic storage space that is accessible through an ordinary door with flooring. There is probably five or six hundred sq ft or more of space in total that could have been utilized as living space had I chose to make it that way during construction. I have 3925 sq ft of actual living space. The house next door has 4001 sq ft of living space but virtually no attic storage simply because they did choose to build it utilizing every sq ft of attic space. My house would have been around 4500+ sq ft had I done what they did. So, how is my attic storage valued? Clearly this space should have value, just not at the same rate per sq ft as living space. Will their overall smaller house value for more simply because they used more attic for living space? The house is currently a rental but I’m considering selling and want to use a recent appraisal of the house next door to get a rough idea what mine is worth.


    • While you have a larger attic space than the house next door I highly doubt you will get any significant value for it. Buyers do not typically place a lot of importance on how much attic space is in a house. This has been my experience in the area I live and work, however, if I were you I would talk to a real estate agent who is familiar with the local market. They talk to buyers all the time and may provide some insight into how local buyers perceive attic space. If you had two identical houses side by side for sale and the only difference was that one had more attic storage then a potential buyer may choose the one with additional attic but I don’t think they would pay more for it.

  11. Hi Tom,

    Great blog, very helpfu! I have a walkup 3rd floor finished, permitted attic with a bedroom, bath, and bonus room. It measures 450 sqft consistent with the ANSI measurement requirements. Its finished to the same standards as the rest of the house, with its own dedicated central HVAC and connected to the second level via a finished stairway (not through a bedroom). From all descriptions, it seems to meet the requirements for inclusion in GLA. I’m in the process of selling, and my realtor has told me to expect an appraisal for that 450 sqft to be less than the per sqft price of the 1st and 2nd floors, simply because it is 3rd floor space. I couldn’t find any mention of this phenomenon online, so I was interested in your opinion. Should I expect less, and if so, how much less? 20%? 50%? Thanks!

    • Dan, I’ve never heard of that before. I think the agent may be confused. If everything you say is accurate the 450 sf third level should be valued the same as the other areas. The fact that it is the third level should not hurt you.

  12. Hello Tom,
    I read your blog about attic space being included in the square footage if at least half is 7ft. high? Would it be possible to get square footage credit for the area that is 7ft. For example that attic space is 400 sq. ft. and only 180 sq. ft. of it is 7ft. high? Could the 180 sq. ft. be included in the square footage.
    The home has access to the finished attic space from the master bathroom not from a hallway or stairway. Does that make a difference as well?

    • Darlene, it sounds like it would pass the test so to speak. Since it has not access from a hallway it could probably still be included and counted as a sitting area.

  13. Hi, does anyone have guidance on the impact to accessing a finished attic through a 2nd floor bedroom? We are considering buying a house that has a very small third bedroom. The third bedroom has a closet and then another door that leads to the attic stairway. While it’s not an issue for us as we would likely use this third bedroom for storage or work out room we are concerned about resale. I know it’s not uncommon to have a pulldown ladder access to the attic from a bedroom but a stairway seems odd. But maybe this is more typical than I realize and isn’t something to be too concerned about. Most of the homes in the neighborhood were built between the 1920s and 1940s. Any thoughts or guidance would be appreciated. Thanks!

    • It confused me a little when you said that the third bedroom has a closet and then another door that leads to the attic stairway. Not sure if that particular area is finished or not, or if it is an unfinished area that leads to a finished area. If you have to pass through unfinished area to get to finished area it cannot be included in the total gross living area of the house.

  14. Hello. We are considering purchasing a home with 1200 square foot finished attic space. A contractor built this mome for himself 15 years ago. I don’t think a permit was pulled for it. The extra square footage isn’t included in taxable living space. Taxes are so high in this area that we live in. We don’t want this to count as living space when we buy it. The realtor told us that it doesn’t have to be included on taxes because there isn’t a bathroom upstairs. Could this be true? We couldn’t afford this house if we were taxed on it. We don’t want to get zinged for doing something wrong either. What are your thoughts?

    • Hey Carrie, thanks for the question. I don’t know exactly where you live so your tax assessor may do things a little differently than mine does. An area does not have to have a bathroom to be counted as living area, however the type of finish, access, and ceiling height will play a bigger role in whether it could or should be included. The appraiser will be able to make the determination as to whether it can be included as gross living area. If the area is considered living area and you bought it I don’t believe the tax assessor would know about the extra square footage because they would not see a copy of the appraisal. The only way they would know about extra living area is if a building permit was obtained or the assessor spoke with you or the owner or viewed the interior of the home. If you have any questions you may want to contact a local appraiser to ask them the question you asked me since they will know the local laws. Hope this helps.

      • I don’t think it’s fool proof to assume that since the town does not have this info, they will never get it… They sure can!. In my case, my county did a town wide home reassessment for tax purposes and an independent appraisal company was hired to reassess ALL the homes. They send out an inspector to your our home to bring all information about your home up to date. We needed to let them in, but if they couldn’t get in, they used old information to recalculate your value to bring it up to current market value. I had a neighbor who tried to slip away, but the independent company the town hired was very aggressive about it and waiting at the street for the owner!

        Part 2 of my story – Please understand the difference between a unfinished attic, finished attic, and half story. This is a HUGE difference that I learned the hard way! I have an unfinished space above my garage that I always thought was an attic. It does have a door from my daughter’s bedroom that we use as storage. My assessment was much much higher in the access of 40K compared to the same model home on my street. I was lucky enough that our town’s property assessor was patient enough to hear all my descriptions of this room and corrected this area from “unfinished half story” to “unfinished attic”. Just by correctly categorizing this space, the new assessed price was lowered by 40K. Unfortunately, the independent company the town hired did not give me the time of day to explain to me the difference and told me to go to the appeal hearing if we didn’t agree with their assessment. I was lucky that I was spared he hearing because I was very persistent on the township level. I hope that helps!

        The diagram that Tom has is greatly helpful to determine attic vs half story/floor but would be even better if we can see side by side how an attic is determined.

        Given, the county does not do this often.. the last time they did this was over a decade ago, but nevertheless it does happen.

        Information is power and if I only knew the difference, I would have had an easier time getting our PRC corrected sooner!

        • Thanks for sharing your story N.S. I agree that information is power. To make sure that our property taxes are correct, and that we are not overpaying, we need to make sure the county has the correct information. Classifying areas and making sure the square footages are correct is a good starting point. Glad to hear you had a good outcome!

  15. Hey Tom,
    question for you. I have a finished attic, stairs, walk in closet, full bath and bedroom. However the ceiling height at its highest point is only 6.6ft. (sad me). when I had the appraisal done, the appraiser noted that due to the ceiling height, the area would be valued separately and at a lower rate. Do you know what that rate might have been? Is there a standard to that type of thing? I’m trying to decide if raising the ceiling height is worth getting that extra bit of value.

    • Kelly, thanks for the question. There is no rule of thumb or formula for calculating the value but it will depend on several factors. The picture I included in the article shows the requirements for the area to be included. It will also depend on what buyers in your area are willing to pay for the attic room, and this can only be determined by doing the appraisal. I will say that the type of access will also influence the value as well as the degree of finish. You might want to ask the appraiser how much value they assigned to the finished attic since they are familiar with it.

      • Hi Tom,

        Here’s a related question – does ANSI absolutely require that the finished attic have heat? Our attic is finished but is not separately heated and we’ve never had an issue with it being cold. In fact, it’s one of the warmest rooms in the house and we live in the Northeast, where it has been bitterly cold.

        • Hey Jared, thanks for the question. I would think that as long as it is comfortable and is acceptable to the general market then it should be fine. Is this area also adequately cooled during the summer? If sufficient heating and cooling is provided by way of a hallway or stairway is should be acceptable, given that the quality of construction is similar to the rest of the home.

          • Yes, it is adequately cooled in the summer via a window air conditioner. The house does not central AC (yet) so this is the same cooling employed for the rest of the house.

          • Jared, it sounds like it should meet ANSI requirements if the quality level is similar to the rest of the house, and is adequately heated and cooled with acceptable sources.

  16. Great post, Tom. You nailed this one. I really like the image too because it helps the reader understand exactly what you wrote.

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