California Real Estate Practice Exam

The prospective purchaser of real property would be most concerned with the:

1. chronological age of the improvements

2. economic life remaining in the improvements

3. effective age of the improvements

4. physical life remaining in the improvements

The correct answer is: chronological age of the improvements

The correct focus for a prospective purchaser of real property is the economic life remaining in the improvements. When evaluating a property, the economic life refers to the period during which the improvements (like a building or structure) will provide value to the owner before repairs or replacement are needed. This aspect is crucial as it directly influences the return on investment and the long-term viability of the property. Buyers want to know how long they can expect to utilize the improvements effectively without significant additional investment. Considering the chronological age of the improvements can offer some insights, but it does not provide a complete picture of the property's value or condition. Effective age, while relevant, pertains more to the perceived age of the property based on its condition and maintenance, which might overshadow other factors. Physical life remaining may reflect how long the structure can endure before it must be demolished or replaced, but it does not address the financial aspects and usability of the property in the real estate market.