What is a common reason for property value depreciation?

The common reason for property value depreciation is the deterioration of the physical structure. As a property ages and its maintenance and repairs are neglected, this physical deterioration can significantly impact its value. Factors like structural damage, outdated systems (such as plumbing or electrical), and poor overall condition can make a property less attractive to potential buyers or renters. This decline in physical appeal results in decreased market value because prospective buyers may have to invest additional resources to bring the property up to a desirable standard.

In contrast, the other scenarios listed typically suggest factors that would increase property value. Economic growth generally leads to higher property values due to increased demand and investment in the area. Increased demand for housing reflects a competitive market where properties are often valued higher due to scarcity. Finally, improvements in local amenities, such as parks or schools, tend to enhance the desirability of a location, driving up property values as more people seek to purchase homes in that area.