What might cause an appraiser to value two identical properties differently if they were built 20 years ago?

The scenario where two identical properties, built 20 years ago, are valued differently can be largely attributed to physical deterioration. Over time, all properties undergo wear and tear due to various factors, such as environmental exposure, wear from normal use, and maintenance practices. Even if two properties started off identical, variations in the level of upkeep, quality of construction, and the impact of local environmental conditions can lead to differing levels of physical deterioration.

For instance, one property may have been regularly maintained with updates and repairs, while the other may have been neglected, resulting in visible signs of damage such as peeling paint, roof issues, or outdated systems. The appraiser takes into consideration these physical aspects, assessing how they influence the property's current condition and overall marketability. This correlation directly impacts the appraised value, as properties in better physical condition typically achieve a higher appraisal.

Other factors like economic obsolescence and functional obsolescence can also lead to valuation differences, but they relate to broader external market influences or design inefficiencies rather than the physical state of the properties themselves. Market deterioration refers to shifts in the real estate market as a whole, which also wouldn’t apply if the properties are identical and only differ in their physical condition. Thus, physical deterioration stands