Economic Obsolescence

Economic obsolescence refers to a decrease in the value of an asset, typically real estate, due to external factors rather than the asset's physical condition. These factors can include changes in the local economy, such as a decline in demand for certain properties due to nearby industrialization, environmental issues, or shifts in demographics. Essentially, it's when something loses value not because of its own faults, but because of changes happening around it that impact its desirability or utility.