Property Valuation
The 'principle of regression' in Pennsylvania appraisal theory states that:
AProperty values will eventually return to long-term trend lines
BAn over-improved property is pulled down in value by surrounding lower-value properties✓ Correct
COlder properties depreciate at accelerating rates
DSupply increases will always reduce property values
Explanation
The principle of regression holds that a high-value property surrounded by lower-value properties will be dragged down toward the value of the lesser properties. This is why over-improving a property relative to its neighborhood rarely maximizes return — the neighborhood level anchors value.
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