Which situation would indicate a site is over-improved?
Correct Answer
A) The improvement cost more than the market returns
Why this is correct: An over-improvement (superadequacy) occurs when the cost of an improvement exceeds the value it adds in the market. It is a form of functional obsolescence where the property is too good for its location or market, and the extra investment is not recouped upon sale. Why the other choices are wrong: 'The site has more area than the building needs' describes surplus land, not over-improvement. 'The building is older than others in the area' describes physical deterioration or possibly external obsolescence. 'The site is smaller than the neighborhood norm' describes an under-sized site. Exam tip: Over-improvement = improvement too costly/massive for the site or neighborhood. The cost is not supported by market value.
Why This Is the Correct Answer
Why this is correct: An over-improvement (superadequacy) occurs when the cost of an improvement exceeds the value it adds in the market. It is a form of functional obsolescence where the property is too good for its location or market, and the extra investment is not recouped upon sale. Why the other choices are wrong: 'The site has more area than the building needs' describes surplus land, not over-improvement. 'The building is older than others in the area' describes physical deterioration or possibly external obsolescence. 'The site is smaller than the neighborhood norm' describes an under-sized site. Exam tip: Over-improvement = improvement too costly/massive for the site or neighborhood. The cost is not supported by market value.
More Land/Site Questions
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