Property Valuation
A property's value is most likely to be reduced by external obsolescence if it is:
ANewly renovated with modern finishes
BLocated next to a newly opened landfill✓ Correct
CSituated in a highly desirable school district
DImproved with an in-ground swimming pool
Explanation
External obsolescence is caused by factors outside the property. A landfill opening nearby creates negative external influences (odor, traffic, aesthetics) that reduce the property's value — and the owner cannot cure this deficiency.
Related Arkansas Property Valuation Questions
- Reconciliation in appraisal refers to:
- Price differs from value in real estate because price is:
- Effective age differs from chronological (actual) age in that effective age reflects:
- The cost approach to value is most reliable for:
- Effective age differs from actual (chronological) age in that effective age:
- The principle of ANTICIPATION in appraisal states that:
- A property has an NOI of $36,000 and a cap rate of 8%. What is its estimated value?
- Which type of depreciation is caused by factors OUTSIDE the property, such as a nearby highway being constructed?
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