How is the effective age of a property defined?

The effective age of a property is defined as the age that has been adjusted for the property’s condition, maintenance, and any improvements made over time. This concept reflects not just when the property was built, but how well it has been maintained and updated. A property that has received regular upkeep, renovations, or enhancements may have an effective age that is significantly less than its actual chronological age. Therefore, in appraisal practice, considering the effective age helps provide a more accurate representation of the property's current value and market position, as it takes into account factors that directly affect desirability and functionality.

The effective age is important for appraisers as it influences how they assess depreciation and value. It may lead to a different valuation approach than simply looking at the actual year since construction, as it factors in the property's overall appeal and utility as it stands today.