After the housing crash, in some areas, inspectors stopped including the lower level as gross living area and called it a basement because it's partly below grade. Some people ended up with houses worth a third or half (for split entries) as much as they had been. And some were unable to sell to anyone except cash buyers because many split entries have all the bedrooms on the lower level, so the houses suddenly had no bedrooms (because only rooms in the GLA get listed like that). Banks wouldn't issue mortgages.

The language really only changed after Sandy, when so many people with lower level NYC brownstone flats got flooded. The value was discounted because they were no longer GLA-eligible spaces. I had a friend in DC with one of the half-underground condos split from s Georgetown town home who got screwed at the same time. Her condo's floor is 6" below grade.

Guess who dug out the foundation of her split level? That would be me. (Yes, in my case, it was fine.)

The language now has a clause allowing for partly below grade areas to be counted in GLA if it's customary for the area for similar structures.

The Sandy thing was covered in The NY Times.