What is curable depreciation?

Curable depreciation refers to a type of property value reduction that can be fixed or improved upon with reasonable investment. This type of depreciation occurs when there are defects or issues that can be economically repaired or corrected, leading to an increase in the property’s value.

For instance, if a property has a worn-out roof or needs cosmetic improvements, addressing these issues can enhance the aesthetic appeal and functionality, and ultimately reflect positively on the property’s market valuation. This is deemed economically feasible because the cost of such repairs is generally less than the anticipated increase in value resulting from them.

In the context of real estate appraisal, recognizing curable depreciation is crucial because it can inform investors and appraisers about which improvements might yield the best return on investment, thereby aiding them in making informed decisions about property purchases and renovations.