The cost approach to value is a real estate appraisal method that is used to help determine an opinion of the value of real estate. The cost to reproduce (or rebuild) the property is calculated by estimating land value and improvements value based of reproduction or replacement of the subject property, less accumulated depreciation.
The cost approach is more typically used on special purpose, new developments, and where there are few comparable property types (churches, schools, industrial sites, etc.).
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