Which factors are relevant to the "cost approach" in property valuation?

The "cost approach" to property valuation focuses on determining the value of a property based on the cost to replace or reproduce it, taking into account any depreciation that may have occurred over time. This methodology is particularly applicable for properties that do not have a lot of comparable sales data available, such as unique or specialized properties.

In this context, the replacement cost represents the current cost to construct a similar property using modern materials and standards, while depreciation accounts for factors like wear and tear, functional obsolescence, and external economic impacts that may have diminished the value of the property since it was built.

Using this approach allows assessors to arrive at a value that reflects both the intrinsic worth of constructing a new property and the economic realities affecting the existing asset's condition and marketability. The other factors, while they may be important in other valuation methods, do not directly pertain to the cost approach, which centers specifically on cost analysis rather than market trends, comparable sales, or locational advantages.