The Appraisal Report Is Changing November 2: What Kansas City Buyers and Sellers Need to Know About UAD 3.6

Everyone in real estate is talking about the new appraisal report right now, and most of what's reaching buyers and sellers is either jargon or panic. So here's the plain-English version.

Starting November 2, 2026, appraisals on conventional loans have to be delivered in a brand-new format. The industry calls it UAD 3.6, and the report itself is the redesigned URAR (Uniform Residential Appraisal Report). It replaces the forms appraisers have used for decades.

The headline is simple: this changes how your home is reported, not how it's valued. An appraiser still visits, still pulls comparable sales, and still gives an opinion of value. But the report looks completely different, it's more detailed, and in Kansas City, where a huge share of our homes have finished basements and walkout lower levels, the details land differently than they do in most of the country.

What's Actually Changing

Fannie Mae and Freddie Mac, the two agencies that buy most conventional mortgages, have retired the old lineup of appraisal forms. The single-family 1004, the condo 1073, the exterior-only 2055 and the rest are being replaced by one dynamic report that grows or shrinks based on the property. A condo gets condo sections. A home with an accessory dwelling unit gets an ADU section. A standard house doesn't carry pages of blank boxes that don't apply to it.

The pieces that matter most for you:

Square footage is broken into separate buckets. The report splits a home into finished area above grade, finished area below grade, and unfinished area above and below grade. The old catch-all "gross living area" label is gone.
One national measuring standard, no exceptions. Appraisers measure to a standard called ANSI Z765. Fannie Mae started requiring it in 2022, but until recently appraisers could use an exception code to follow local custom. That exception is gone, and the new report is built around the standard.
Low-ceiling space gets its own line. A finished room has to have at least 7 feet of ceiling height over most of its floor to count as standard finished area. Space that doesn't qualify, like a bonus room with a steep sloped ceiling, gets reported separately as "nonstandard finished area."
Condition gets split into interior and exterior. The familiar condition and quality ratings (C1 through C6, Q1 through Q6) have clearer definitions. Appraisers can now rate the inside and the outside separately when they're noticeably different. A tired exterior won't necessarily drag down a beautifully updated interior, or the other way around.
More detail, more description. The report captures a lot more specific data points and written commentary alongside the photos. That means appraisers need more information from the house and from us.

The Date That Actually Matters

The November 2 cutoff is based on when the appraisal report is submitted to Fannie Mae or Freddie Mac. It isn't based on when you went under contract or when you applied for the loan. If you sign a contract in mid-October and the appraisal is delivered after November 2, it will come back in the new format.

Lenders have been allowed to use the new report since early 2026, so some of you may see one before the deadline.

Which loans does it apply to?

Conventional loans (Fannie Mae and Freddie Mac): required for reports submitted on or after November 2, 2026.
FHA loans: FHA has opened the door to the new format but hasn't set a required date. Legacy reports are still accepted.
VA and USDA loans: no timeline announced yet.
Jumbo loans: each lender or investor sets its own rules. This is worth asking about, because many Johnson County homes above the conforming loan limit are financed with jumbo loans. Some jumbo lenders will adopt the new report quickly and some won't. Ask your loan officer which one you'll get.

Why This Matters More in Kansas City Than Almost Anywhere

Here's the local part. Kansas City is walkout-basement country. Across south Overland Park, Leawood, Olathe and Lenexa, it's normal for a third to half of a home's finished living space to sit on a lower level. The reverse 1.5 story plan that dominates a lot of our new construction puts the primary suite upstairs and a full finished walkout below.

Under the measuring standard, any level that sits even partly below the ground counts as below grade, walkout or not. Appraisers have always reported basements separately from main living area. What's new is how visible it is. The new report puts the above-grade and below-grade numbers side by side for your home and for every comparable sale, and the measuring rules are the same for everyone.

That creates two situations I want every client to understand before they see their report.

The appraisal may show a smaller number than the listing. Our MLS lets agents enter above-grade, below-grade and total finished square footage, and the number that shows up on the big home search sites is usually a total. So a home marketed at 3,400 square feet might appear on the appraisal as 1,900 feet above grade plus 1,500 feet finished below. Nothing's wrong. It's the same house described two ways. But if you've never seen it split out, it can feel alarming. I wrote a whole post on why two KC listings with the same square footage can be 800 feet apart, and the new report makes that gap impossible to miss.

Below-grade feet and above-grade feet aren't valued the same. The market has always paid more per foot for above-grade space than for a finished lower level, and appraisers adjust for that. A great walkout with full-size windows, a wet bar and a bedroom with egress is worth real money. It's just valued on its own line. If a seller priced a home as if every finished foot were equal, the gap between that price and the appraisal is where deals get renegotiated. That's the appraisal gap, and the new report isn't going to make it less likely.

Will Appraisals Take Longer?

Possibly, for a while. Appraisers are learning new software and a longer report right as the deadline hits. Expect some bumps around November, especially on unusual properties: acreage, homes with ADUs or guest houses, older homes with additions, and anything with a lot of nonstandard space.

If you're buying or selling this fall, here's what I'm telling clients:

Build a little cushion into your timeline. If your contract has a tight appraisal deadline around the first half of November, talk to your lender now about realistic turn times.
Ask your lender which format you'll get. Some lenders switched early. Knowing ahead of time means nobody is surprised when the report looks nothing like the one they got on their last house.
Don't panic at a longer report. More pages and more boxes don't mean the appraiser found problems. It's just how the new report is built.

If You're Selling: Be the Appraiser's Best Source

NAR's advice to agents is to become the upfront source of information for appraisers, so they aren't making a return trip or guessing. I take that seriously, and it's where a seller can actually help their own appraisal. Before the appraiser comes out, pull together:

Your square footage, split out. Above grade, finished below grade, unfinished. If you had the home professionally measured, even better.
Permits for finished basements, additions and remodels. Finished space with a permit trail is a lot easier for an appraiser to support.
A list of updates with dates and rough costs. Roof, HVAC, windows, kitchen, baths. The new report has more room to describe condition, so give the appraiser something to write.
Details on anything unusual. Guest suites, outbuildings, a pool, solar panels, a sport court. These have their own fields now, and the appraiser has to fill them in with accurate information.
The basics in order. Working smoke and carbon monoxide detectors, safe access to every level, and nothing that makes a finished room look unfinished.

When I list a home, I put this into a short package for the appraiser. It takes an hour, and it's one of the easiest ways to protect the price you negotiated. If you're thinking about selling and want to know how your home will read on the new report, start with a home value estimate and we can talk through the details.

If You're Buying: Read the Listing With the Report in Mind

For buyers, the new report is actually good news. It makes it harder for square footage to hide.

Ask every listing for the split. How many feet above grade, how many finished below? If the answer isn't clear, the price-per-foot math isn't either.
Compare homes on the same basis. A reverse 1.5 story and a traditional two-story with the same "total" square footage are very different houses. See my guide to walkout basement homes in Kansas City for what makes a lower level worth paying for.
Plan your appraisal strategy up front. In a competitive offer, how much appraisal protection you keep is a real decision. Make it before you write, not when the report comes back.

The Short Version

The new appraisal report (UAD 3.6 / URAR) is required for conventional loans on reports submitted on or after November 2, 2026.
It changes how homes are measured and reported, not how they're valued.
In Kansas City, the biggest practical change is how clearly above-grade and below-grade space are separated. That matters here because so much of our value sits in finished walkouts.
Expect a longer report and possibly slower turn times around the switch.
Sellers who hand the appraiser accurate square footage, permits and a list of updates will have the smoothest appraisals.

If you're under contract, about to list, or just trying to figure out what your home will look like on the new report, reach out. I'm happy to walk you through it before your appraiser does.