Property Valuation
Stigmatized property in Indiana (such as a property where a crime occurred) may have reduced value due to:
APhysical deterioration from the incident
BPsychological impact on buyers reducing demand, even if no physical damage exists✓ Correct
CMandatory price reductions required by Indiana law
DInsurance surcharges
Explanation
Stigmatized properties may suffer reduced market value due to buyer reluctance — psychological stigma — even if there is no physical damage. Indiana law may or may not require disclosure of certain stigma-creating events.
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Key Terms to Know
Appraisal
A professional estimate of a property's market value prepared by a licensed or certified appraiser.
Gross Rent Multiplier (GRM)A quick valuation metric for income properties calculated by dividing the property price by gross annual rental income.
Comparable Sales (Comps)Recently sold properties similar in size, condition, and location used by appraisers and agents to estimate a property's market value.
DepreciationA reduction in the value of an improvement (building) over time due to physical deterioration, functional obsolescence, or external factors.
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