Cost approach In calculating total

depreciation.
Price, cost and value. The
terms price, cost and value
are normally applied
imprecisely in our everyday
conversation, however within
the real estate valuation field
they have a specific meaning.
method
When to use the cost approach
Special Use Properties, New
Construction, Property Insurance,
Commercial Special Considerations
Total depreciation, made
up of physical
depreciation and
functional and / or
external obsolescence,
must necessarily be based
on market evidence for its
calculation.

Physical depreciation
There are two main types of (based on age, total useful
cost focus evaluations: life, and condition) is
Reproduction method: This traditionally the only form
version considers the cost of of depreciation applied to
Bibiana Sipagauta replicating the property and the value of buildings. In
Group:212032_42 pays attention to the use of most cases, aspects
October 17, 2021 raw materials. inherent to the property
itself (functional
Replacement method. In this obsolescence) or external
case, the new structure is to it (economic
assumed to have the same obsolescence) are mostly
function but with newer recognized by the market
materials, using existing and therefore of much
construction methods and greater relevance than
updated design. the first