Question

A home is located in a neighborhood where home-owners on the block have failed to maintain their properties. This is an example of:________.

a) curable external obsolescence.
b) incurable economic obsolescence.
c) functional obsolescence.
d) physical deterioration.

Answer 1

B) incurable economic obsolescence.

Step-by-step explanation:

Real estate economic obsolescence refers to a property losing values due to external factors not related to the property itself, e.g. an industrial plant built near a residential neighborhood would decrease the value of the houses inside that neighborhood.

Usually economic obsolescence is caused by uncurable factors, since the owner of the property cannot control or eliminate them, e.g. in this case the owner of the house cannot fix all the houses in the neighborhood.