Property Valuation
Depreciation in real estate appraisal means:
AThe tax deduction available to investment property owners
BAny loss in value from any cause✓ Correct
CThe physical wear of a building over time only
DDeclining property values in a neighborhood
Explanation
In appraisal, depreciation means any loss in value from any cause — physical deterioration (wear and tear), functional obsolescence (outdated features), or external obsolescence (outside negative factors). This is broader than the accounting definition of depreciation.
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