The difference between reproduction or replacement cost new of a property and its market value is known as ____________.

The difference between reproduction or replacement cost new of a property and its market value is known as accrued depreciation. This concept relates to the loss in value that a property experiences over time due to physical deterioration, functional obsolescence, or external factors.

Accrued depreciation is a critical component in the appraisal process because it helps appraisers determine the current value of a property based on its current condition and market dynamics. When an appraiser evaluates a property, they often calculate both reproduction and replacement costs to provide a baseline for understanding what it would cost to create a similar property today. However, the market value may differ from these costs due to various factors that impact a property's desirability and functionality, all of which contribute to the accrued depreciation.

In contrast, depreciation generally refers to the overall decrease in value over time, while replacement cost refers specifically to the cost of replacing the building at current prices. Market adjustment involves modulating values to reflect current market trends but does not specifically address the difference between cost and value directly. Thus, the term accrued depreciation accurately captures the nuanced difference required in this context.