Property Valuation
What is 'functional obsolescence' in an appraisal?
ALoss of value from external market conditions
BLoss of value from defects within the property that reduce its utility or desirability, such as an outdated floor plan or inadequate plumbing✓ Correct
CPhysical deterioration from deferred maintenance
DLoss of value from environmental contamination
Explanation
Functional obsolescence is a loss in value due to features of the property itself that reduce utility or desirability, such as outdated kitchens or baths, poor floor plans, inadequate electrical systems, or ceiling heights that don't meet current market expectations.
Related California Property Valuation Questions
- When adjusting a comparable sale in the sales comparison approach, an appraiser ADDS value to the comparable when the comparable is:
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- What is a Broker Price Opinion (BPO) and how does it differ from an appraisal?
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