What does depreciated value refer to?

Depreciated value refers to the original value of a property minus depreciation. This concept is essential in real estate valuation, as it captures the decline in value of an asset over time due to factors such as wear and tear, age, and obsolescence.

By calculating the depreciated value, one can get a clearer picture of the property's worth in its current condition compared to its initial purchase price. This is particularly relevant for investors and lenders who must assess a property's potential resale value or the equity available in a property used as collateral for loans.

The other choices do not accurately define depreciated value. The listing price reflects market strategies at a given time rather than the property's actual depreciated worth. The increase in value from combining parcels speaks to the principle of assemblage, which is unrelated to the concept of depreciation. The current market value considers all market dynamics and does not specifically account for depreciation as a factor in the calculation. Thus, the option correctly identifies the formula for determining the depreciated value based on accounting for the original cost adjusted for depreciation.