Actual and Effective Ages
Fannie Mae does not place a restriction on the actual age of the dwelling. Older dwellings that meet Fannie Mae’s general requirements are acceptable. Improvements for all properties must be of the quality and condition that will be acceptable to typical purchasers in the subject neighborhood.
The relationship between the actual and effective ages of the property is a good indication of its condition. A property that has been well-maintained generally will have an effective age somewhat lower than its actual age. On the other hand, a property that has an effective age higher than its actual age probably has not been well-maintained or may have a particular physical problem. In such cases, the lender should pay particular attention to the condition of the subject property in its review of any appraisal report. When the appraiser makes adjustments for the “Year Built,” he or she must explain the adjustments that were made.
For additional information, see B4-1.3-05, Improvements Section of the Appraisal Report.