Valuation
External (Economic) Obsolescence
A concise definition for the California Real Estate Exam study guide.
Definition
Loss in value from influences OUTSIDE the property — adverse nearby uses, neighborhood decline, economic downturns. Generally incurable because the owner can't control external factors.
Why it matters on the California real estate exam
Know the definition, recognize how the term appears in a fact pattern, and compare it with related concepts before choosing an answer.
Study this topic in context
Read the related chapter for the surrounding concepts, examples, and exam tips.
Chapter 6: Valuation & Appraisal →