Which term describes the decline in value due to wear and tear?

• A. Functional Obsolescence
• B. Regression
• C. Progression
• D. Physical Deterioration

Answer: (D)

Wear and tear over time leads to physical deterioration, the decline in a property's value caused by the physical condition of the building declining from ordinary use. This term specifically captures how the actual state of repair—cracked walls, leaky roofs, worn flooring, aging systems—reduces market value because repairs or replacement are needed.

This is different from functional obsolescence, which happens when design or layout features are no longer desirable or useful, even if the property is physically sound. And it’s not about neighborhood effects (progression or regression), which describe how property values move due to market or location dynamics rather than the property’s own condition.

So the term describing decline in value due to wear and tear is physical deterioration.