Actual Age
Definition of "Actual age"
There’s no mystery. The actual age of a property is the chronological age of a property. Say a house was built two decades ago. That house’s actual age is 20 years old.
The counterpart to it is the Effective Age, which refers to the state the property is currently in.
So, do you know how sometimes you see a person that looks really young – effective age - and you’re amazed that he/she is actually much older – actual age - than what you’d thought? That can happen in the real estate world as well if the homeowner has done a good job with maintenance and renovations.
Usually, this relation of one versus the other comes up in bad scenarios, where the Fair Market Value of the property is brought down because the effective age of the house is much older than the actual age. But in rare cases it can bring the fair market value up because the former is so much older than the latter that it creates a perception of value due to the fact that it stood the test of time and became almost a relic in comparison to other properties in the market.
Real Estate tips:
Learn the actual meaning of hundreds of real estate terms in our Glossary.
Search through The OFFICIAL Real Estate Agent Directory® for that perfect agent!
Popular Real Estate Terms
Legal proceeding to exercise a right in a disagreement between private individuals or businesses. One party seeks a remedy against the other. It does not involve a criminal situation. ...
Interest a person pays before it is actually incurred. An example is a one year's interest that a borrower agrees to pay in advance to a bank on a mortgage. This rarely occurs. ...
The period when a financial debt, such as a mortgage, must paid. ...
Pipes transporting water. ...
Unrealized gain in value of real property from holding it. The increase value is not recognized in the accounts. When the property is sold there will be a realized gain or loss. ...
Assets owned by an individual as part of his or her estate except for land and everything attached to the land. Personal property may be either tangible, having physical substance such as ...
Probate court approved title issued to the distribute of an individuals intestate estate. ...
Owned by one individual or sole ownership. ...
If you have been wondering what can cause a market failure, the most common answer is externalities. An externality is an indirect cost or benefit to a neutral third party that comes from ...
Have a question or comment?
We're here to help.