Property Valuation
What is 'functional obsolescence' in property appraisal?
APhysical deterioration of the building's structure
BA loss in value due to deficiencies or super-adequacies within the property itself, such as an outdated floor plan or inadequate bathrooms✓ Correct
CEconomic decline in the surrounding neighborhood
DDepreciation due to environmental contamination
Explanation
Functional obsolescence is a form of depreciation caused by deficiencies (too few bathrooms, inadequate electrical service) or super-adequacies (overly expensive finishes for the neighborhood) within the property itself. It is distinguished from physical deterioration (wear and tear) and external obsolescence (outside factors).
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