Effective age is represented by the condition of a building rather than its what?

Effective age refers to the age of a property as perceived by its condition and performance, rather than its actual age. It reflects how well the property has been maintained and any renovations or upgrades that have been applied over time. This allows a property with a recent renovation to be viewed as 'younger' than its actual chronological age.

Chronological age is the literal age of the building, calculated from the date of its construction to the present time. While chronological age gives a straightforward measure of how long the building has existed, it does not account for the current state or functioning of the structure. Therefore, effective age can differ significantly from chronological age, especially if the building has received significant maintenance or improvements that enhance its condition.

Understanding the distinction between effective and chronological age is crucial for appraisers, as it influences property valuation and market perceptions. By assessing effective age, appraisers can provide a more nuanced understanding of a property's value that considers both physical state and market desirability.