Property Valuation
An appraiser notes that a Tacoma neighborhood has experienced significant economic decline, with empty storefronts and declining rents. This type of depreciation affecting the subject property is:
APhysical deterioration — curable
BFunctional obsolescence — incurable
CExternal obsolescence (economic or locational depreciation)✓ Correct
DDeferred maintenance
Explanation
External obsolescence (also called economic or locational depreciation) arises from factors outside the property, such as neighborhood decline, economic conditions, nearby hazards, or changes in land use. It is always considered incurable by the property owner.
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