Physical Obsolescence

[Terrel L. Shields]

use it to describe obsolete style, design, construction type

Incorrect. It is functional obsolescence. "Dated colors" used to be one of my favorites when you found an avacodo green or Harvest Gold appliance. Shag Carpet.
"Physical" relates to wear and tear. Check your textbooks. Don't make up terms on your own...
"Dated colors" are an inadequacy, therefore are functionally obsolete. Has nothing to do something working or not.

 

[Rich Heyn]

Does anybody use the term physical obsolescence. I use it to describe obsolete style, design, construction type or anything except functional/external obsolescence. Such as, characteristics that don't affect function, but are cosmetically obsolete (i.e. building materials, popcorn ceilings, dated fixtures, shag carpet etc.). I had an underwriter call me out on it and I'm looking for a formal definition. I did a web search and did not find anything on it. Did I just make this term up? Any feedback would be greatly appreciated.

Search the index of your edition of "The Appraisal of Real Estate" under "functional obsolescence," "functional utility" and "functional inutility." I believe a half-hour of reading will answer your questions.

 

[Functional Obs]

Since these terms can be confusing, and since your reader might not understand, you can use other words and phrases:

For your "physical obsolescence," which is depreciation or deterioration, try simply "wear and tear," or my favorite, "deferred maintenance" (as if somebody's eventually going to get around to fixing it!)...

Instead of functional obsolescence, try "dated," "committed," or "non-conforming." Also, don't be afraid to just call out the issue: "The subject would benefit from having a half bath on the main level." (for example ... if you were in a market area where all the other houses seemed to have that).

And for external obsolescence, it's best to just say what the problem is: "noise from the freeway," etc.

my .02