What does the construction cost at current prices of a property that serves the same function as the original refer to?

The term refers to "Reproduction cost," which involves calculating the cost to construct an exact replica of a property using the same materials, design, and construction methods as the original. This measure is important for appraisers and professionals in real estate as it helps to determine the value of older structures by considering what it would take to recreate them in their original state.

This concept is particularly useful in scenarios where a property has historical significance or unique architectural features that may not be easily replicated with modern methods or materials. Understanding reproduction cost allows for a more accurate valuation of properties that are sold or assessed you may want to account for their historical context.

Replacement cost, while similar, focuses on the cost to build a property that serves the same function but uses modern materials and design. Market value pertains to what a property is expected to sell for in the current market, while comparative value typically involves looking at similar properties to gauge value but does not specifically focus on the cost of construction.