Property Valuation
Depreciation in an appraisal context refers to:
AThe IRS tax deduction for income property
BAny loss in value from any cause✓ Correct
COnly physical wear and tear on the building
DThe reduction in land value over time
Explanation
In appraisal, depreciation refers to any loss in value from any cause — physical deterioration, functional obsolescence, or external (economic) obsolescence.
Related Alabama Property Valuation Questions
- The principle of substitution states that a buyer will pay no more for a property than:
- An appraiser notes a comparable property sold for $300,000. The comparable has a pool, but the subject does not. The pool is estimated to contribute $15,000 in value. The appraiser should:
- When appraising a property using the income approach, stabilized NOI is used rather than actual current NOI because:
- Which approach to value is most commonly used to appraise single-family residences?
- An appraisal that understates value is called:
- When an appraiser concludes that the cost approach results in a significantly higher value than the sales comparison approach, this may indicate:
- In the sales comparison approach, a comparable property that sold for more than the subject property due to a superior feature would require:
- The principle of 'regression' in real estate value states that:
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