What is the term for the loss of value due to external factors affecting property?

The term that describes the loss of value due to external factors affecting a property is economic obsolescence. This occurs when changes in the surrounding environment or economic conditions negatively impact the value of a property, even if the property itself remains intact and in good condition. Factors leading to economic obsolescence can include things like the construction of a nearby landfill, changes in zoning laws, declining local economic conditions, or an increase in crime in the area, all of which can make a property less desirable.

Functional obsolescence, on the other hand, refers to a decrease in property value due to outdated features or layout within the property itself, making it less useful or desirable compared to current standards. Physical deterioration refers specifically to the wear and tear of the structure over time. Incurable depreciation indicates a loss in value that is unlikely to be repaired or improved upon, but it does not specifically relate to external influences. Therefore, economic obsolescence is the specific term that accurately describes the loss of property value stemming from external factors.