The Cost Depreciation Approach is also referred to as what?

The Cost Depreciation Approach is best identified as the Cost Approach because it focuses on determining the value of a property based on the cost to replace or reproduce it, minus depreciation. This method is grounded in the principle that a buyer will not pay more for a property than the cost to construct a similar one.

In this context, the Cost Approach examines factors such as the cost of labor and materials, the current condition of the property, and any depreciation that might have taken place over time due to wear and tear or external factors. This method is particularly useful for valuing properties that are unique or not easily compared to others in the marketplace, such as special-purpose buildings or new construction.

The other options mischaracterize or relate to different valuation methodologies. The Replacement Approach, while related, is more specific to replacement costs rather than accounting for depreciation. The Market Value Approach primarily focuses on comparable sales data and not strictly on cost considerations. Investment Analysis typically involves evaluating potential income generation, making it different in scope and application from the Cost Approach.