Valuation & AppraisalQuestion 54 of 120
An outdated floor plan that reduces a home's value is an example of:
a.Physical deterioration
b.Economic obsolescence
c.Functional obsolescence
d.Land depreciation
Explanation
Functional obsolescence is a loss in value due to outdated or undesirable features within the property itself, such as a poor floor plan or one-car garage. Physical deterioration involves wear and tear, while economic obsolescence stems from external factors. Each type is analyzed in the cost approach.
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