Property Valuation
Which of the following best describes 'functional obsolescence' in real estate appraisal?
APhysical deterioration from wear and tear
BA loss in value due to outdated design features or inadequate layout compared to current standards✓ Correct
CLoss in value due to external neighborhood changes
DDamage caused by flooding or natural disaster
Explanation
Functional obsolescence is a loss in value attributable to deficiencies or changes in style or design that make the property less useful or desirable. Examples include a home with only one bathroom in a market that expects two, outdated kitchen layouts, or bedrooms accessible only through other bedrooms. It can be curable or incurable.
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