In the Fannie Mae March newsletter, an appraiser’s question dealt with what constitutes a decommissioned ADU (accessory dwelling unit). Fannie responded with some specifics.

“Accessory dwelling units are a recurring topic that appraisers ask about through our appraisers’ inbox,” Fannie Mae said in the newsletter. “Recently, we received a question about decommissioning an ADU. The scenario presented was a property had a functioning ADU in the past (that would not be allowed as a separate unit per zoning), which the appraiser was told had been decommissioned. So how does the appraiser make the determination if the area is still an ADU? Is removing the stove enough? Do kitchen cabinets need to be removed, or could they be used for other purposes? Are bathrooms, OK?

“Instead of checking off each individual item, appraisers can refer to our requirements for classifying an ADU as a whole, keeping in mind that these are the minimum requirements for an ADU,” Fannie answered. “If the area in question does not meet all the items required, it is not considered an ADU.”

Fannie Mae’s policy indicates the requirement of “a stove or stove hookup (hotplates, microwaves, or toaster ovens are not acceptable stove substitutes).” If the stove has been removed, does the hookup still exist? If the answer is “yes,” it is still an ADU if all the other criteria are met. If the stove hookup (electric or gas line, etc.) has been removed, does it still qualify as an ADU? The answer is “no” because it does not meet the minimum kitchen qualification.

Similarly, Fannie goes on to say, if cabinets or bathrooms exist in an area that has previously been used as an ADU, they do not on their own classify the area as an ADU.