Which type of depreciation can often be repaired or mitigated?

Physical deterioration refers to the loss of value of a property due to its physical condition and the effects of time, wear and tear, and environmental factors. This type of depreciation is tangible and can often be repaired or mitigated through maintenance, renovation, or improvement efforts. For instance, if a property has a roof that is in disrepair, replacing or repairing the roof can effectively restore some of the property’s value.

Unlike physical deterioration, economic obsolescence typically refers to a decrease in property value due to external factors, such as changes in the economy or neighborhood, which are often beyond the owner's control and cannot easily be repaired. Functional obsolescence arises from changes in technology or consumer preferences that render certain property features outdated or less desirable, which may require significant modifications or upgrades to resolve. Depletion involves the reduction in value due to the extraction of resources, which is not something that is typically repaired or mitigated in the same way as physical deterioration.

Overall, addressing physical deterioration can directly improve a property's condition and enhance its market value, making it a more manageable form of depreciation.