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Investing | Real Estate

What Does HLA Stand for in Real Estate

In terms of real estate, HLA stands for “Heated Living Area.” However, the abbreviation is open to several other interpretations such as:

  • High-level architecture
  • Home location area
  • Housing land availability
  • Human leukocyte antigen and much more

Typically, a living area is also referred to as “heated square footage” or “heated living area,” and it’s a space intended for human occupancy. Here are some additional criteria for a space to qualify as a heated living area.

  1. It must be heated using conventional heating sources permanently installed in the dwelling like solar energy, forced air, radiant, etc. It should not be heated with fireplaces or portable heaters that generate heat based on a year-round occupancy.
  2. It should be finished with ceilings and walls using the right kind of material, for example, paints, sheet rocks, hardwood or carpeted flooring, etc. The accepted ceiling height is usually seven feet unless it’s under ducts or beams, which means the height could be up to six feet.
  3. If a certain portion of the room has a ceiling height of up to five feet, given that one-half of the finished area has a ceiling height of up to seven feet, you can include it as a living area.
  4. It should be directly accessible from other living areas through a stairway, a door or even a heated hallway.

What areas come under a “living area?”

Since qualifying a certain space for a heated living area requires meeting criteria, it can sometimes be overwhelming and confusing. To put it simply, a finished room people use for general living, such as a kitchen, a bedroom, a dining room, and a living room, can come under the category of “living area.” However, for other areas, the categorization may not be easy. For instance, the following areas can come under “living area” if they are finished, heated and directly accessible from the living area.

Attic

Given that you have applied the ceiling height criteria and kept the slope factor in mind, an attic could very well be a part of the area.

Basement

Generally, a basement is an area under the entry-level of the dwelling that you can access by stairs. It should have earth adjacent to a certain portion of preferably a single wall above the floor level. Typically, a full flight of stairs refers to stairs that connect two main floors, given that the height of the ceiling for the lower floor is seven feet. There can also be an exception to the seven feet rule if the ductwork provides clearance of at least six feet and four inches.

Bay window

This area could also come under an HLA if it has a ceiling height of up to seven feet and a floor.

Bonus room

This space can be a finished room over your garage, for example. Make sure to keep the ceiling slope factor in mind and apply the “ceiling height” criteria if it is sloped.

Breezeway

This area is enclosed and can also come under an HLA if all the criterion has been met.

Chimney

Interestingly, the chimney itself may not come under the category due to obvious reasons. However, the chimney base is technically inside a living area. If is the chimney is outside, but the hearth is inside, include the hearth in the area instead of the chimney base.

Closets

Closets could also come under the category if they are functioning as a part of the living area.

Furnace room

If the water heater or furnace is in a closet in the HLA, you can include it in the “living area” even if any other criterion has not been met.

Hallways

Hallways come under the HLA category if they happen to be a functional part of the area in question.

What is an agent’s responsibility?

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HLA is a subject every real estate agent should have sufficient knowledge about. This is because they are directly responsible for reporting accurate calculations of the square footage of all dwellings to any party interested in a property and to other agents involved. An agent is required to provide accurate information about the square footage of a living space by using reasonable skill, diligence, and care. While they are doing the calculations, they should also be mindful that the commission is not looking for absolute perfection.

Since every property is unique and there is no set of guidelines to predict every possibility, the commission is pretty laid back regarding minor discrepancies in square footage measurements. Luckily, an agent is not held responsible for such details. However, this does not mean an agent should not be sensitive to minor variations in tape readings. This is because these small differences lead to bigger errors and impact their interpretation.

For example, a minor variation in tape readings and small errors in rounding off or converting a figure from inches to decimals can cause a major discrepancy. Moreover, apart from these variations in calculation and measurement, the overall interpretation can also differ. For instance, if two agents are involved in the square footage calculation of a property, their judgment about whether an addition to a particular dwelling is finished well enough to be a part of the living area can be different.

Therefore, agents must base their decisions on reasonable judgment, keeping relevant guidelines in mind even if the commission does not decide to constitute an error on the agent’s part. If the discrepancy in calculated square footage is less than 5%, it may cause concern unless a broker intervenes and overstates it.

Generally speaking, the situation is not entirely inevitable, and an agent can obtain accurate data. They can do this by measuring the dwelling unit personally and calculating the square footage. On the other hand, if an agent is unable to take measurements personally, they can also rely on the square footage reported by other people, given that it’s reasonable to have them do it under the circumstances.

Agents who work with buyers often rely on the ’listing agent’s square footage representations unless there is an error in the footage. For instance, a buyer’s agent may not notice that a house with 2200 square feet of HLA only had about 2000 square feet in reality. However, the same agent may notice that a house advertised to have 3000 square feet only has 2000 square feet of HLA.

The agent should promptly point out these red flags to the listing agent and the buyer. This way, the listing agent will be able to verify the calculation and correct errors in the reported information. It is also acceptable for an agent to depend on calculations performed by experts in the matter. It’s also recommended for new agents to seek guidance from a professional before attempting to take measurements themselves.

When should an agent start taking measurements themselves?

New agents need a good amount of exposure and confidence before becoming less reliant on professional services. It’s even possible for experienced agents to seek professional services to confirm the accuracy of the reported square footage. For example, if an agent comes across an unusual calculation problem, their experience may not be enough to work in such a situation. Even if an agent relies on measurements given by a professional, they should still pay attention to any obvious errors in the reported figures and alert the relevant parties. They should also pay attention to unreliable sources of information.

For example, information coming in from a property owner is not entirely reliable. In the same way, the information mentioned on property tax records is also questionable. An agent should collectively deem sources of information such as a listing, a survey, or an appraisal report as unreliable.

Moreover, if the prevailing practice in an area is to advertise or market a home by using square footage information, it is possible for it to be unreliable as well. Therefore, agents who are not primarily responsible for calculating or reporting square footage details should disclose this information to the respective owners or prospective buyers before making any agreement with them. Brokers should also retain photos, calculations, and sketches relevant to square footage for at least three years.

Total vs. Gross living area

The total living area is not the same as the gross living area. While GLA and TLA are both a part of residential properties, there is a key difference between the two. TLA consists of a finished basement space, while a GLA is a finished space above ground level. The reason why it’s important to establish the difference between them is that they are usually kept separate in an appraisal assignment.

Most appraisers also like to state the difference clearly because it helps them determine the monetary value of a property. For example, the local market gives more value to finish above ground than finish below ground. Skewing them together could give misleading figures to an appraiser. Inaccurate data means inaccurate opinions regarding a property’s value.

Why is it important to have GLA calculations?

One of the main ways agents try selling properties is by putting up figures of a gross living area (GLA). The figures listed in public records may not always be accurate for many reasons. Therefore, whether you’re an agent or a buyer, make sure to read through these figures. If you suspect inaccurate information, refer to an Appraisal Partner to recheck your home’s property measure. Knowing the right details, especially about the gross living area, can save you from many troubles later when you’re selling or purchasing a property.

How to calculate gross living area

Typically, GLA is calculated by taking measurements of the property exterior. This is often the standard way to do it for single-family dwellings that are detached. On the other hand, for properties with attached dwellings(such as condominiums), GLA is calculated using interior measurements. While taking relevant measurements, appraisers often begin from a certain dwelling corner and go on to measure each wall of the exterior. Then, they round off the measurements to the nearest inch before proceeding to record them. However, it’s not always necessary to round off the figures to the nearest inch. They can also be rounded off to the nearest foot, depending on the appraiser’s preferred measurement method.

The reason most people stick to measurements in inches is because they assume it would not cause a significant discrepancy. Many markets do not consider lower than 100 square feet of size difference as a big enough figure to permit an adjustment.

Nonetheless, it is possible to come across slightly different figures from appraiser to appraiser due to a difference in their measurement method. Luckily, such differences aren’t noticeable enough to impact the final decision on a property’s value. Appraisers also use sketches and run them through software to determine the total square footage of an area. In conclusion, the gross living area is very easy to find out once an appraiser has all relevant exterior dimensions.

Human leukocyte antigen

HLA, among many other definitions, is also an abbreviation for Human Leukocyte Antigen. The HLA system is a group of genes encoding the MHC or Major Histocompatibility Complex proteins on the leukocyte cell membrane in humans. On a side note, the MHC proteins are also called antigens. The primary duty of these proteins is to regulate the immune system.

Even though the subject is completely unrelated to real estate, the HLA abbreviation is something many people come across while searching for the relevant term. This is why we have briefly touched upon it to help people differentiate a human leukocyte antigen from the housing and real estate jargon.

In simpler words, the HLA is a molecule on most cell surfaces in the human body. It plays a crucial role in the immune response of your body to any foreign elements or substances. It also plays a part in making up the human tissue type that is different for every person. The HLA tests are usually conducted before an organ or a donor stem cell transplant so that professionals can figure out if there is a match of tissues between the recipient and the donor.

Functions of HLA

HLA is the key player in dealing with a number of health-related aspects such as:

Fighting infections

When a foreign substance or pathogen enters inside the human body, the APCs or antigen-presenting cells cover it. However, the proteins present in the pathogen become a part of the HLA antigens after digesting into smaller pieces. Then, they get displayed to your white blood cells by your antigen-presenting cells. Your white blood cells then act accordingly to remove the pathogen from your body.

Autoimmunity

Most HLA types are linked to autoimmune disorders. Many people who have a certain type of HLA antigen are also at risk of developing complications such as narcolepsy, type 1 diabetes, rheumatoid arthritis, and much more. However, recently, there has been significant improvement in the diagnosis of certain diseases due to HLA typing. All in all, the molecules of HLA act as a shield to protect you from antigens your body cannot tolerate and abnormal cells that lead to the development of cancer.

Conclusion

In conclusion, the real estate definition of HLA is all about categorizing space under “living area” by using criteria such as heating, finishing, proximity to other areas, etc. However, HLA also stands for the following:

  • Human Leukocyte Antigen
  • High-Level Architecture
  • Home Loan Account
  • Home Loan Applicant
  • High-Level Assessment
  • Home Location Agent
  • Heavy Load Assessment
  • High-Loss Area
  • Home Location Area and much more

Interestingly, many interpretations of HLA listed above are also relevant to real estate, housing and properties in general which leaves us with even more to dig than what we started with.