Appraiser Update

Treatment of Location and View in UAD 3.6

UAD 2.6 requires appraisers to rate Location and View on a three‑point scale—adverse (A), neutral (N), or beneficial (B)—and then describe the Location or View factors that drive the rating. Because of space constraints in the UAD 2.6 forms, appraisers are limited to two factors for each. The number of defined factors appraisers can choose from is also limited: only eight for View and 10 for Location. Further, they must be entered using cryptic abbreviations such as “LtdSight” or “Ind”. While View is reported in both the Site section and the Sales Comparison grid, Location is only reported in the Sales Comparison grid.

This framework limits an appraiser’s ability to communicate clearly. How should the appraiser rate the location when it is affected by both adverse and beneficial influences? How should the appraiser convey when there are more than two meaningful factors? How is the reader expected to interpret the abbreviations? And how proximate is the location factor?

UAD 3.6 Replaces Location with a Broader Concept: Site Influence

Site Influence groups both View and Site Influence within the Site section (along with other site characteristics such as Size, Parcels, Zoning, Use, Access, Features, Utilities, Defects, and Site Valuation). At 30 pages, the Site section is the second largest chapter in Appendix F-1: URAR Reference Guide, trailing only the Sales Comparison Approach (67 pages). This underscores the importance of site characteristics in the valuation process—recall the old adage, “location, location, location.” Clear, concise, and accurate descriptions and analysis of site characteristics are essential to a credible appraisal report.

Rather than beginning with the Location or View rating and then applying factors, UAD 3.6 begins by asking the appraiser to select all View and all Site Influence types that apply. The lists of defined enumerations are expanded to 28 View and 20 Site Influence types, plus a catch‑all Other option for characteristics not captured in the defined lists. All enumerations are spelled out in plain English—no more abbreviations.

Where to Look for More Details 

The operational definitions and examples that support these inputs—site influence types, required detail fields, proximity rules, impact ratings, view types, range definitions, and photo expectations—are found in Appendix F‑1: URAR Reference Guide, Section 04 Site (notably 4.025–4.038 for Site Influences and 4.039–4.042 for View). These tables are concise and designed for quick reference during daily appraisal work.

Market Conditions Analysis Letters

In late 2024, we updated the Fannie Mae Selling Guide (Section B4-1.3-09, Adjustments to Comparable Sales – Market Conditions Analysis and Time Adjustments) to emphasize that we always expect appraisers to analyze whether there have been any changes in market conditions from the time a comparable goes under contract until the effective date of the appraisal, and to make time adjustments as indicated by the analysis. Failure to make time adjustments when they are clearly indicated is an unacceptable appraisal practice.

We accept a broad range of evidence in support of the appraiser’s time adjustment decisions including such things as paired sales, statistical analysis, modeling, and home price indices. The appraisal report must always contain a summary of the appraiser’s data sources, tools, and techniques used to determine the time adjustments. Recognizing that not all appraisers keep up with Selling Guide requirements, we published guidance about time adjustments in our Q4 2025 Appraiser Update.

As we continue to see appraisal reports that do not meet our time adjustment requirements, we have begun to send educational letters to appraisers whose reports exhibit patterns of noncompliance.

Recurring Issues

We hope that our educational letters will help appraisers who may not have tuned in to our Selling Guide updates or our newsletters. The best way to avoid receiving a letter is to always provide clear, fact-based commentary that explains the rationale behind the adjustment methodology.

MH Policy Changes  

The MH market continues to evolve as homebuyers seek more affordable options and as HUD Code changes enable new design and engineering capabilities. To support these developments and fulfill our mission of providing reliable liquidity to the market, we’ve introduced several MH policy updates during 2025 and 2026.

Policy Changes

Appraiser Responsibilities  

As our MH policies evolve, appraisers are still responsible for validating property characteristics and identifying appropriate MH Advantage or CHOICEHome comparable sales whenever possible.

Validation of Property Characteristics 

Appraisers must continue to verify core manufactured housing requirements, including the presence of: 

• The data plate for each dwelling unit
• HUD certification label(s) (HUD tag[s]) for each transportable section
• The MH Advantage® sticker, when applicable (it is typically found near the data plate) 

Photos of each required item must be included in the appraisal report. 

For 2–4 unit MH properties, each dwelling unit will have its own data plate, and a photo of each must be provided. Multi‑unit and multi‑story configurations may involve more transportable sections than traditional designs, so appraisers should confirm that every section’s HUD certification label is identified and photographed. 

For MHA (and CHOICEHome), the appraiser needs to confirm (and provide photos of) the required onsite improvements: 

• Permanent Foundation
  • Meet HUD’s Permanent Foundation Guide for Manufactured Housing
  • Engineered Foundation certified by a registered architect or professional engineer; and
  • Masonry or Poured Concrete Perimeter
• Elevation
  • Be a low-profile/residential set finished floor set
  • Not exceeding 30 inches from the bottom of the first-floor joist to the exterior grade for the front or entry
  • Have a covered porch (minimum 72 sq. ft.)
• For a single-section MH Advantage or CHOICEHome with a date of manufacture after June 4, 2026
  • An attached garage or carport with space to accommodate at least one car
  • Garage exterior materials and finishes equivalent to the home
• Driveway
  • Must lead to the home (or to the garage/carport if present)
  • Material must be blacktop, pavers, bricks, concrete, or cement
• Sidewalk
  • Must connect either the driveway or an attached garage/carport to the front entrance of the home
  • Material must be blacktop, pavers, flagstone, bricks, concrete, or cement
• Gutters and Downspouts
  • Verify that the property includes a gutter and downspout system to direct water away from the foundation and structure 

Certain requirements are relaxed for MHA on infill lots. The appraiser’s other MH responsibilities (such as verification that the towing hitch, wheels, and axles have been removed and that the home is attached to a permanent foundation) have not changed, but this article does not contain a comprehensive list. Appraisers should consult Selling Guide B2‑3‑02: Special Property Eligibility and Underwriting Considerations: Factory-Built Housing, for more details.

Validation Support

When appraising MH Advantage properties, appraisers must use other MH Advantage or CHOICEHome sales as comparable sales whenever possible. If fewer than three such sales are available, appraisers must supplement with the best and most appropriate comparable sales available, considering the superior features of MHA when selecting or adjusting typical MH comparables.

As multi‑story and multi‑unit MH designs enter the market, comparable sales may be limited. In these situations, appraisers may need to use a mix of property types—balancing characteristics such as number of units, construction method, and number of stories. For example, adjustment rates for site‑built versus manufactured construction may be derived from single‑unit sales and applied thoughtfully to multi‑unit analyses. In all cases, clear, concise explanations should accompany the valuation to help readers understand the appraiser’s methodology and conclusions.  

New Glossary Definitions

Accessory Dwelling Unit Policy Changes  

In Dec. 2025 we announced expanded eligibility allowances for properties with Accessory Dwelling Units (ADUs), effective Mar. 31, 2026, but only for loans with UAD 3.6 appraisals.

This expansion of our ADU criteria is designed to help meet the growing demand for flexible and affordable housing solutions. 

Earlier, we also amended our rental income policy to allow income from an ADU to be considered toward qualifying income, provided all the following requirements are met: 

• The property must be a one-unit, principal residence and is limited to purchase and limited cash-out refinance transactions.
• Rental income may be derived from only one ADU, even if multiple ADUs exist.
• The amount of ADU rental income used for qualifying may not exceed 30% of the borrower's total qualifying income. 

How this impacts appraisers 

When requested by the client, the appraiser should determine and report an estimate of market rent for the ADU.  This should be based on true ADU rentals when available. When ADU rental comparables are scarce, appropriate substitute rentals may be used, with careful consideration of differences between whole-property rents and rents of individual-units from multi-unit properties, the latter commonly being more representative of ADU functional utility and market appeal. 

Reporting requirements differ depending on whether the appraisal is reported under UAD 2.6 or UAD 3.6:

All other Selling Guide requirements for rental‑income documentation continue to apply. 

*We allow an exception in rare cases when the need to estimate the market rent arises after completion of the appraisal and the original appraiser is unavailable to amend the appraisal report; in such a case, a different appraiser may document the market rent estimate on the 1007 form. Form 1007 is not a standalone appraisal report, and the alternate appraiser completing it must take the necessary steps to be compliant with Uniform Standards of Professional Appraisal Practice (USPAP).