Functional obsolescence
A design or feature that hurts value even when it works fine, because buyers now expect something different. A one-car garage in a three-bedroom neighborhood is a common example.
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Where this comes up: getting ready
Part 1 of 4
Why a seller cares
A layout or feature buyers no longer want lowers value even when it works: a one-car garage, a bathroom through a bedroom, a kitchen closed off from everything. Some of it can be fixed for the price of a wall; some cannot.
Part 2 of 4
A simple example
A three-bedroom home with one bathroom in a neighborhood where every comp has two. The appraiser adjusts, and buyers with families skip the showing.
| The feature | What it does, and whether it is fixable |
|---|---|
| One bath in a two-bath neighborhood | A real adjustment; fixable at a real cost |
| A closed-off kitchen | A buyer objection; sometimes one wall away from fixed |
| Low ceilings | Not fixable; priced in |
Functional obsolescence is a house working the way houses used to.
Part 3 of 4
What people get wrong
That it means something is broken. Everything works; it is what buyers expect that changed.
Part 4 of 4 · where to read next
Where it appears in the sale
What a definition is, and what it isn't
Keighbor is a software company, not a law firm, brokerage, or tax adviser. This is general information, not legal, tax, financial, or real estate advice about your sale. Your situation may differ. Before acting on a contract, disclosure, title, tax, or pricing question, ask an appropriately licensed professional in your state.
Written and researched by Keighbor Research · drawn from the reference glossary · how we research and check what we publish
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