Certified Pennsylvania Evaluator Practice Exam

What is the term used to describe a situation where the cost to cure physical deterioration is equal to or less than the increase in value?

1. Incurable

2. Curable

3. Deferred Maintenance

4. Physical Obsolescence

The correct answer is: Curable

The term that describes a situation where the cost to cure physical deterioration is equal to or less than the increase in value is known as "Curable." In real estate appraisal, this concept refers to repair or improvement costs that are justifiable because they will ultimately enhance the property's value. When the cost to fix the deterioration aligns with or does not exceed the potential increase in value, it indicates that addressing these issues is economically feasible. This principle is essential in the valuation process because it helps appraisers determine the potential investment return from repairs. A situation classified as curable suggests that it makes financial sense to address the physical deterioration, as doing so will lead to an increase in the overall value of the property. This aligns with the broader goal in property appraisal of maximizing value through effective investment in maintenance and repairs. In contrast, other terms like "Incurable," "Deferred Maintenance," and "Physical Obsolescence" describe scenarios where repairs are either not feasible, economically unviable, or due to external factors that can't be addressed readily, thereby illuminating the significance of the curable condition within property assessments.