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Let s assume that we are about to appraise a house using the cost approach. The home was originally constructed in the early 1 9
Lets assume that we are about to appraise a house using the cost approach. The home was originally constructed in the early s and is one of the last of its kind in this area. The cost of constructing an exact replica of this residence is estimated to be $ On our trip to the actual property, we notice that this is the only residential unit located on this particular road. Based on the current usage of adjacent real estate, we estimate that the property would be worth an additional $ in its highest and best use. However, due to the dramatic shift in the perceived safety of the neighborhood, values of any remaining residential properties in the area have fallen by $ Due to the homes age, we also notice that there has been a significant amount of physical deterioration to the building, amounting to an estimate of $ in lost value. Since the home was built over years ago, the floor plan is quite obsolete relative to current preferences. This has a detrimental effect on the value of the property that is estimated to be approximately $ Given this information, determine the appraised value of the home using the cost approach.
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