After a March 2026 fire, an insurer asks Appraiser David to estimate the current cost of rebuilding a historic courthouse with the same design, layout, and materials it had before the loss. Which cost concept best fits that assignment?
Correct Answer
A) Reproduction cost of an exact or near-exact duplicate
Reproduction cost estimates the current cost to construct an exact or near-exact duplicate using the same design, layout, materials, and workmanship. That concept fits an assignment involving a historic structure where the goal is to rebuild the same building rather than a modern substitute.
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Previous Question
In May 2026, Appraiser Lena is valuing a custom home that was completed last month in Aspen Ridge, an area with very few comparable sales. Which approach is often especially useful as support in this situation?
Next Question
On a June 2026 appraisal, Emma estimates a home's replacement cost new at $320,000 and site value at $90,000. Physical deterioration is $20,000 and functional obsolescence is $10,000, with no external obsolescence. What indicated value does the cost approach produce?