In 1996, the American National Standards Institute (ANSI) adopted a standard for measuring single-family residential buildings, called the American National Standard Z765-1996. This standard was last revised in 2003. The standards were developed by consulting with several industry groups, including Realtors, builders, architects, and appraisers.

The ANSI standards are NOT LAW, only a voluntary guide.
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The ANSI Standard is the accepted method by National Association of Realtors and by the North Carolina Real Estate Commission.

The ANSI standard bases floor area calculations on the exterior dimensions of the building at each floor level, and include all interior walls and voids. "Finished area" is defined as “an enclosed area in a house suitable for year-round use, embodying walls, floors, and ceilings that are similar to the rest of the house.”

The North Carolina Real Estate Commission gives this guideline for “Heated Living Area”:

“Living area (sometimes referred to as "heated living area" or "heated square footage") is space that is intended for human occupancy and is:

  1. Heated by a conventional heating system or systems (forced air, radiant, solar, etc.) that are permanently installed in the dwelling - not a portable heater - which generates heat sufficient to make the space suitable for year-round occupancy;
  2. Finished, with walls, floors and ceilings of materials generally accepted for interior construction (e.g., painted drywall/sheet rock or paneled walls, carpeted or hardwood flooring, etc.) and with a ceiling height of at least seven feet, except under beams, ducts, etc. where the height must be at least six feet four inches [Note: In rooms with sloped ceilings (e.g., finished attics, bonus rooms, etc.) you may also include as living area the portion of the room with a ceiling height of at least five feet if at least one-half of the finished area of the room has a ceiling height of at least seven feet.]; and
  3. Directly accessible from other living area (through a door or by a heated hallway or stairway).”