Principle Of Conformity
The Principle of conformity states that conformity is achieved when all the entities or objects comply to the same standard, rules or laws. This creates a balance and stability between entities that are subjected to the same environment.
What is the principle of conformity in real estate?
In real estate the principle of conformity has to do with all the property in a neighborhood that comply with the same architectural standard and design. A home that is not conform is a house that has a design or structure that is different from the other homes which can cause a depreciation in value. On the other hand if a house adheres to the same style and design of the houses around it it will increase in value as a result.
What is non conformity in real estate?
The real estate market in many places suffers for not having a sense of conformity. This usually occurs in areas that are underdeveloped where people buy vacant lots. People have different ideas on what the property should look like based on taste and budget. This creates a mixture of properties with different styles and design, thus hurting the value.
Examples of conformity in real estate.
For example if you have a four-story house located in a neighborhood of single-family homes, the four-story houses value would go down. An increase would only occur if the four-story house was placed in a neighborhood of similar homes.
Same principles apply in commercial real estate, in order to generate more sales. For example, the same type stores that provide similar services are strategically placed in the same area.
Most malls have a specially designated area only for food stores, and we see clothing stores placed one after another. Around the city you might see clothing stores located one near the other, and the same applies for food or other stores that provide different services.
Popular Real Estate Terms
Lender has an equity interest in the property that is the subject of the loan. The lender shares in the increase in market price of the property as well as any net income generated. ...
The metaverse definition can be described as a digital environment that is simulated through the use of augmented reality (AR), virtual reality (VR), and blockchain technology, combined ...
Range reconnaissance, or surveying, for the purpose of preparing grazing capacity estimates. There are two parts to a range survey: mapping of grazing cover varieties and associated ...
Form used to record information about a credit applicant's ability to meet his obligations in connection with a real estate purchase. ...
Rental in which the lessee obtains major property rights. Although not legally a purchase of property, theoretical substance governs over legal form and requires that the leased property be ...
(1) Mildly convex arch built into a load bearing beam, girder, or truss to counteract any load bearing stress placed on it. (2) Slight slope designed into a structure such as a drive4way or ...
A legal procedure to sell a mortgage property to the highest bidder in order to satisfy a mortgage claim from a mortgagee against the value o the property. A foreclosure sale can occur from ...
Situation in which a purchaser acquires mortgaged property and continues to pay the mortgagee for the debt outstanding. Although the new buyer continues to pay the mortgagee for the debt ...
Each payment made by the borrower is equal each period, usually monthly. Each payment is comprised of principal and interest. Interest is based on the beginning balance. The cash paid less ...
Have a question or comment?
We're here to help.