What is 'depreciation' in real estate appraisal?
Why A loss in value from any cause Is Correct
Answer B: A loss in value from any cause
Exam Tip: Property Valuation
Valuation questions focus on the three approaches to value: sales comparison, cost, and income. Know which approach is best for which property type. The income approach uses cap rate and NOI — memorize these formulas.
Key Property Valuation Terms in This Question
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Related California Questions
- Functional obsolescence differs from physical deterioration in that it results from:Property Valuation
- External obsolescence (economic obsolescence) differs from other depreciation types because it is:Property Valuation
- External obsolescence (economic obsolescence) is caused by:Property Valuation
- What is 'functional obsolescence' as used in real estate appraisal?Property Valuation
Key Terms to Know
A reduction in the value of an improvement (building) over time due to physical deterioration, functional obsolescence, or external factors.
AppraisalA professional estimate of a property's market value prepared by a licensed or certified appraiser.
Short SaleA sale of real property where the sale proceeds are less than the outstanding mortgage balance, requiring lender approval.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
Math Concepts
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