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Does the lower floor of a split-level home count as square footage?

Published August 27, 2026

Does the lower floor of a split-level home count as square footage?
It depends on the grade, not the layout. The lower level of a split-level or bi-level home counts as gross living area only if no part of it is below the ground on any side. Most split-levels have a lower level that is a few feet into the ground, which makes it below-grade area under ANSI Z765 even though it has full-size windows and a family room.

Why split-levels cause arguments

The lower level of a split-level looks and lives like the rest of the house: same finishes, same ceiling height, full windows. Buyers and MLS listings count it. The all-sides rule in ANSI Z765 does not care how it lives; it looks at where the ground is. A lower level that is 3 feet down on the front is below grade, and so is one that is 1 inch down. ANSI has no minimum depth; any part below ground on any side puts the whole level below grade.

Fannie Mae allows the appraiser to explain that the market treats the lower level as living area and to adjust value accordingly, while still reporting the square footage below grade.

The bi-level (raised ranch) case

A bi-level has its entry between floors and its lower level partly buried; it is treated the same way. A raised ranch is the same problem with a different floor plan.

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